Strategic Risk Integration, Risk Oversight and Operational Performance of Listed Multinational Companies in South-West Nigeria
Keywords:
Enterprise risk management, strategic risk integration, riskoversight, operational performance, multinational companies, Nigeria, PLS-SEMAbstract
Enterprise Risk Management (ERM) has emerged as a comprehensive framework that enables organisations to identify, assess, and manage risks across the entire enterprise rather than addressing them in isolation; yet the operational performance implications of its strategic and governance dimensions remain under-examined in emerging markets. This study investigated the effects of strategic risk integration and strategic risk oversight on the operational performance of listed multinational companies (MNCs) in South-West Nigeria. A cross-sectional field survey design was employed, utilising a structured questionnaire administered to senior and middle management employees in the administration, finance, human resource, and operational units of selected MNCs. From a population of 51,286 employees, a sample of 528 was determined using the Krejcie and Morgan (1970) table, of which 499 usable copies were analysed. Data were analysed using Partial Least Squares Structural Equation Modelling (PLS-SEM) with SmartPLS 3, employing 5,000 bootstrap resamples. The measurement model demonstrated sound psychometric properties (AVE ≥ 0.500; CR ≥ 0.861), and discriminant validity was confirmed via the Fornell-Larcker criterion and HTMT ratios (maximum 0.542). Strategic risk integration exerted a significant positive effect on operational performance (β = 0.459, t = 13.478, p < 0.001, R² = 0.211), as did strategic risk oversight (β = 0.421, t = 10.884, p < 0.001, R² = 0.178). Strategic risk integration emerged as the most potent individual ERM predictor, with a large effect size (f² = 0.267). The study concludes that embedding risk into strategy and institutionalising board-level oversight are foundational drivers of operational performance in volatile emerging markets, and recommends the institutionalisation of risk-informed strategic planning cycles and cascading risk communication protocols.
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