Human Capital Development and Financial Performance: Modera ng Effect of Firm Characteristics

This study investigated human capital development and financial performance of listed oil and gas companies in Nigeria. The objectives of this study are to determine the moderating effect of firm size on the relationship between human capital development and the financial performance of listed oil and gas companies in Nigeria and to ascertain the moderating effect of firm age on the relationship between human capital development and the financial performance of listed oil and gas companies in Nigeria. The study covered a period of eleven (12) years (i.e. 2012 to 2023).

The census method was adopted due to the smallness of the entire population. Therefore, all the ten (10) listed oil and gas companies on the Nigerian Exchange Group as of 31st December 2023 constituted the sample size. A multiple regression estimation approach was employed on information extracted from a sample consisting of ten (10) oil and gas companies listed on the Nigerian Exchange Group (NGX) between the years 2012 to 2023. Panel Least Square (PLS) regression technique was employed in estimating the data and testing the formulated hypotheses.

For the ROA Model, the R-squared value of 0.58 shows that the independent variables account for around 58% of the systematic changes in the dependent variable, (ROA). For ROE Model, the R-squared value of 0.44 shows that the independent variables in the model account for around 44% of the systematic variations in the dependent variable, (ROE). In summary, findings reveals that Training and development costs, directors' salaries have a significant effect on financial performance of listed oil and gas companies in Nigeria, whereas employee benefit expense, number of staff have no significant effect on financial performance of listed oil and gas companies in Nigeria, and employee salaries and wages is statistically insignificant in explaining the variations in financial performance of listed oil and gas companies in Nigeria.

Sequel to the findings, the study recommended that the management of listed oil and gas companies in Nigeria should take the issue of training and development of their employees seriously, hence they should not consider training and development cost as a waste but an avenue to improve the financial performance of their respective oil and gas companies.