Sectorial Analysis of Sustainability Reporting in Developing Economies: The Role of Foreign Owned Companies in Nigeria
Abstract
Sustainability reporting has evolved into a critical element of corporate governance. However, its adoption in Nigeria remains limited, hampered by weak regulatory frameworks and an emphasis on short-term financial goals. This study examines the role of foreign ownership in shaping sustainability reporting practices in Nigeria’s Banking and Oil & Gas sectors from 2012–2022. Using Ordinary Least Squares (OLS) regression, the findings reveal significant sectoral differences. In the Oil & Gas sector, foreign ownership significantly drives sustainability reporting, while in the Banking sector, foreign ownership has no significant impact; instead, firm size emerges as the primary determinant, reflecting the importance of organizational capacity and compliance requirements. The study concludes that sector-specific dynamics mediate the influence of foreign ownership on sustainability practices in Nigeria. To enhance ESG practices across industries, targeted policies are needed to align foreign investment with robust sustainability frameworks and support smaller firms in adopting comprehensive reporting practices.
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