A number of studies have been done to examine the factors that impact the level of foreign direct investment in African countries. However, most of them have not considered the effect corporate governance structures have on foreign direct investment (FDI) in their estimations. This research therefore pursued the investigation of the relationship between corporate governance structures at the national level and foreign direct investment concentrating mainly on West African economies for the period 2009–2018. The study constructed a panel, sampling annual data from 17 West African countries. The System generalized method of moments (GMM) was used in analyzing the panel data to attain the objective of the research. The results of the study reveal that countries characterized by greater protection of the interest of non-controlling parties are able to accumulate progressive FDIs. Economies with firms portraying high ethical values also generally generate increasing foreign direct investment, and the existence of effective boards also significantly improves the country’s FDI inflows. Finally, the findings report that the impact of regulations in securities and the stock exchange on FDI is insignificant. The study recommends that West African countries institute corporate governance structures purely independent of political influences in order to ensure effective utilization of foreign direct investment to mitigate poverty.
It has been widely argued that governance structures have roles in the predominance of foreign ownership in Sub-Saharan African countries. Our paper sought to challenge this conventional wisdom by investigating the ways in which country-level governance structures influenced the predominance of foreign holdings in Sub-Saharan African countries for the period 2010–2015. The study used panel sampling annual data from thirty countries in Sub-Saharan Africa, with Ordinary Least Squares (OLS) and Feasible Generalized Least Squares (FGLS) as our discussion estimators. Our statistical results reveal that there is a significant positive relationship between government effectiveness and the predominance of foreign ownership in Sub-Saharan African countries. Furthermore, foreign ownership predominates in Sub-Saharan African economies that have sound political stability and embrace effective and efficient regulations. Moreover, the relationship between corruption and the prevalence of foreign ownership is negative but significant. However, the rule of law, and voice and accountability, are insignificant to the predominance of foreign ownership in Sub-Saharan Africa. Our results suggest that governments in Sub-Saharan Africa should adopt robust and efficacious measures, strengthen their policies and institutions to promote the control of corruption, provide quality regulations, and minimize political violence.
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