Corporate venturing modes and growth of publicly traded companies in Nigeria

Abstract

Purpose: Globally, corporations employ various modes of venturing to revitalize operations, build new capabilities and achieve competitive advantage over rivals for sustainable growth. Despite this trend, many corporate firms are faced with stiff competitions which have led to many winding up and some running into bankruptcy over time. Thus, this empirical paper investigated the impact of corporate venturing on growth of publicly traded companies in Nigeria. Design/Methodology/Approach: Corporate venturing was measured via internal corporate venturing, external corporate venturing and cooperative corporate venturing and return on equity as proxy for growth. The study adopted an ex-post facto research design through a ten year (2009-2018) annual report and accounts of the fifteen (15) studied companies based on the availability of their financial statements for the periods under review. Autoregressive Distributed Lag System modeling technique was used as analytical technique. Findings: The result of the findings revealed that internal corporate venturing and external corporate venturing have significant negative and positive impact respectively on the growth of the studied companies while cooperative corporate venturing revealed an insignificant impact on growth. Implications/Originality/Value: The contribution of manufacturing sector to the Nigerian economy cannot be underscored and as such, the study recommends that the top management level of corporate firms should leverage their assets and capabilities in creating, adding and investing in new business operations in order to maximise shareholders’ rate of return on their investment for sustainable growth.