Submit your papersSubmit Now
For Enquiries: [email protected]
IIARD LogoIIARD

Effect of Firm Demographics on Environmental Disclosure of Listed Consumer Goods Firms in Nigeria and Ghana

Okeke Onyekachi Nath, Akwuobi Bridget U, Onyeogubalu, Ogochukwu N

Abstract

This study empirically investigated the effect of firm demographics on environmental disclosures of listed consumer goods firms in Nigeria and Ghana. In order to determine the effect of firm demographics on environmental disclosures, firm demographics key proxy variables were used in the study, namely; firm leverage (FLEV), ownership structure (OWS) and foreign directors (FDR) while environmental disclosure on the other hand was measured using Kinder Lydenberg Domini (KLD) environmental performance rating system. Three hypotheses were formulated to guide the investigation and the statistical test of parameter estimates was conducted using panel regression model operated with E-Views.12. Ex Post Facto design was adopted and data for the study were obtained from the Nigerian Exchange Group Factbook, Ghana Stock Exchange Factbook and audited annual reports and accounts of the firms under review in both Nigeria and Ghana spanning from 2015-2023. The findings generally indicate that firm leverage, ownership structure and foreign directors have positive and significant influence on environmental disclosures (EVD) at 5% significant level in both Nigeria and Ghana. Based on this, the study concludes that firm demographics determine corporate environmental disclosures in Nigeria and Ghana. In lieu of this, the study suggests above all that optimal financing mix is require by every corporate organization as the extent to which a firm is being funded by debt determines the level of environmental information disclosures in corporate financial reporting in Nigeria and Ghana. Also, more block shareholding by the shareholders (i.e shares ownership concentration of ?5% shareholding) is recommended by the study in corporate organizations as this ensures the level of environmental information disclosures in corporate financial reporting in Nigeria and Ghana. Finally, foreign directorship presence should also be encouraged by the shareholder

Keywords

Firm Demographics; Environmental Disclosures; Firm Leverage; Ownership

References

Abubakar, A. A. (2017). Influence of firms attributes on environmental disclosure in listed brewery companies in Nigeria. Research Journal of Finance and Accounting, 8 (21), 31-35. Abubakar, A. A., Moses, S., & Inuwa, M. B. (2017). Influence of Firms Attributes on Environmental Disclosure in Listed Brewery Companies in Nigeria. Civil and Environmental Research, 8(21), 31–35. Adeeko, B. (2019). Welcome Speech at the NSE Sustainability Reporting Implementation Workshop. Retrieved May 16, 2019, from;https://www.proshareng.com/news/CapitalMarket/Welcome-Speech-By-Bola- Adeeko-At-The-NSE-Sustainability-Reporting-Implementation-Workshop/44468 Adeniyi, S., & Adebayo, H. O. (2018). Effect of Financial Leverage on Voluntary Corporate Social Disclosure among Listed Firms on Nigerian Stock Exchange : A Study of Selected Manufacturing Firms. Academic Journal of Economic Studies, 4(3), 18–24. Adenugba, A. A., Ige, A. A., & Kesinro, O. R. (2016). Financial leverage and firms’ value : a study of selected firms in Nigeria. European Journal of Research and Reflection in Management Sciences, 4(1), 14–32. Ahmadi, A. & Bouri, A. (2017). The relationship between financial attributes, environmental performance and environmental disclosure: Empirical investigation on French firms listed on CAC 40. Management of Environmental Quality: An International Journal, 28 (4), 490-506. Akbas, H. E. (2014). Company Characteristics and Environmental Disclosure: An Empirical Investigation on Companies Listed on Borsa Istanbul. Journal of Accounting and Financial, 6(4), 145–164. Retrieved from http://www.journal.mufad.org/attachments/article/734/9.pdf Andrikopoulos, A., Samitas, A. & Bekiaris, M. (2014). Corporate social responsibility reporting in financial institutions: evidence from Euronext. Research in International Business and Finance, 32 (C), 27-35. Awe, T. T. (2017). Corporate Governance, Growth & Sustainability. The Nigerian Stock Exchange, pp. 1–26. Retrieved from http://www.nse.com.ng/NSEPresentation/170316 Corporate Governance Growth and Sustainability Presentation TTA.pdf Ayoola, T. J. (2017). Environmental Reporting and Accounting Research in Nigeria : Current Practices, Prospect and Future Direction. Nigerian Journal of Environment and Health, 1(1), 72–94. Barnali, C., & Puja, A. G. (2015). A Study of Corporate Environmental Disclosure Practices of Companies doing Business in India. Global Business Review, 2(2), 1–12. https://doi.org/https://doi.org/10.1177/0972150914564430 Bowrin, A.R. (2013). Corporate social and environmental reporting in the Caribbean. Social Responsibility Journal, 9 (2), 259-280. Chandok, R. & Singh, S. (2017). Empirical study on determinants of environmental disclosure: Approach of selected conglomerates. Managerial Auditing Journal. 32 (4/5), 332-355. Christensen, L.J. Mackey, A. and Whetten, D. (2014). Taking responsibility for corporate social responsibility: The role of leaders in creating, implementing, sustaining, or avoiding socially responsible firm behaviors. Acad. Manag. Perspect. 2014, 28, 164– Christopher, T. & Filipovic, M. (2008). The extent and determinants of disclosure of global reporting initiative guidelines: Australian evidence. The Journal of Contemporary Issues in Business and Government, 14 (2), 17-40. Clarkson, P.M., Li, Y., Richardson, G. D., & Vasvari, F. P. (2008). Revisiting the relation between environmental performance and environmental disclosure: An empirical analysis. Accounting, Organisations and Society, 33(4-5), 303-327. https://doi.org/10.1016/j.aos.2007.05.003 Dawar, N., & Frost, T. (1999). Competing with Survival Strategies for. Harvard Business Review, 77(2), 119–129. Dibia, N.O. & Onwuchekwu, J. O. (2015). Determinant of environmental disclosure in Nigeria: A case study of oil and gas companies. International Journal of Finance and Accounting, 4(2), 115-135. Dienes, D., Sassen, R. & Fischer, J. (2016). What are the drivers of sustainability reporting? A systematic review. Sustainability Accounting, Management and Policy Journal, 7 (2), 154-189. Dilling, P. (2010). Sustainability reporting in a global context: what are the characteristics of corporations that provide high quality sustainability reports – an empirical analysis? International Business and Economic Research Journal, 9 (1), 19-30 Drobetz, W., Merikas, A. & Merika, A. (2014). Corporate social responsibility disclosure: the case of international shipping. Transportation Research: An International Journal, 71 (C), 18-44. Edem, E., Owusu, M., Bekoe, R., & Kusi, J. (2017). Determinants of environmental disclosures of listed firms in Ghana. International Journal of Corporate Social Responsibility, 2(11), 1-12 Egbunike, A. P., & Tarilaye, N. (2017). Firm’s specific attributes and voluntary environmental disclosure in Nigeria: Evidence from listed manufacturing companies. Academy of Accounting and Financial Studies Journal, 21(3), 1–9. Ghani, E. K., Jamal, J., Puspitasari, E., & Gunardi, A. (2018). Factors Influencing Integrated Reporting Practices Among Malaysian Public Listed Real Property Companies: A Sustainable Development Effort. International Journal of Managerial and Financial Accounting, 10(2), 144–162. http://doi.org/10.1504/IJMFA.2018.10012811 Ironkwe, U. I., & Success, G. O. (2017). Environmental Accounting and Sustainable Development : A Study of Niger Delta Area of Nigeria. 6(5), 1–12. Issa, S. O., Yunusa, N. & Hamman, A. M. (2021). Board mechanisms and environmental disclosure quality of listed Oil and Gas firms in Nigeria. Gusau Journal of Accounting and Finance, 2(2), 2 – 17. Jang, H. and Kim, J.(2001). Korea Country Paper: The Role of Boards and Stakeholders in Corporate Governance. The Third OECD Asian Roundtable on Corporate Governance. Available online: http://www.oecd.org/ corporate/ca/corporategovernanceprinciples/1873050.pdf (accessed on 6 April 2001) Jones, P., Wynn, M., Hillier, D., & Comfort, D. (2017). The Sustainable Development Goals and Information and Communication Technologies. Indonesian Journal of Sustainability Accounting and Management, 1(1), 1–15. http://doi.org/10.28992/ijsam.v1i1.22 Kabiru, S. (2020). Firm Characteristics and Environmental Disclosure Quality of Listed Cement Companies in Nigeria. African Scholar Journal of Mgt. Science and Entrepreneurship (JMSE-7) 18(7). ISSN: 2276-0732. SEPTEMBER, 2020 Kang, J. (2016). Labor market evaluation versus legacy conservation: What factors determine retiring CEOs’ decisions about long-term investment? Strateg. Manag. J. 37, 389–405 Karaman, A., Kilic, M. & Uyar, A. (2018). Sustainability reporting in the aviation industry: worldwide evidence. Sustainability Accounting, Management and Policy Journal, 9 (4), 362-391. Kiende, G., & Karambu, W. M. (2016). Effect of Corporate Environmental Disclosure on Financial Performance of Firms Listed at Nairobi Securities Exchange. Kenya. International Journal of Sustainability Management and Information Technologies, 2(1), 1–6. https://doi.org/10.11648/j.ijsmit.20160201.11 Kolsi, C. K. (2017). The determinants of corporate voluntary disclosure policy: Evidence from the Abu Dhabi Securities Exchange (ADX). Journal of Accounting in Emerging Economies, 7 (2), 249-265. Li, X., Su, S., Shi, J., & Zhang, Z. (2015). An Environmental Impact Assessment Framework and Index Systemfor the Pre-Use Phase of Buildings Based on Distance-to-Target Approach. Building and Environment, 85, 173–181. http://doi.org/10.1016/j.buildenv.2014.11.035 Mohammed, A., Alhassan, I. & Mohammed, Y. (2022). Effect of environmental disclosure on financial performance of listed manufacturing firms in Nigeria. International Academic Journal of Economics and Sustainable Development, 8(5), 56-

More Articles from JOURNAL OF ACCOUNTING AND FINANCIAL MANAGEMENT

Cashflow Management and the Performance of Commercial Banks in Nigeria

Author: Jeffrey Ayas Iyakonbogha, Clement E. Ozele

The Nigerian Code of Corporate Governance and Financial Performance of Deposit Money Banks in Nigeria

Author: i, Eneaniofu Daniel Mmaduakonam, ii, Azolike Nkiru Nkechi, iii, Emeter Patrick Okechukwu, iv, Okwor Emmanuel Ejimnkonye