Sustainability Reporting and Financial Performance of Quoted Oil and Gas Companies in Nigeria

  • Isokpehi, Lucky Ohikhuare Department of Accounting, University of Port Harcourt, Choba
  • Ebere, Chukwuma Christopher Department of Accounting, University of Port Harcourt, Choba
DOI: https://doi.org/10.17605/OSF.IO/5JTY9
Keywords: Nigeria, Oil, Gas

Abstract

This research was conducted to investigate the relationship between sustainability reporting and financial performance of quoted oil and gas companies in Nigeria. Data was collected from a sample of 10 companies for period of 10 years from 2010 to 2019. Financial performance was measured using return on assets (ROA) and return on equity (ROE). Sustainability reporting was measured using environmental performance indicator (ENVPI); social performance indicator (SOCPI); and economic performance indicator (ECOPI). The panel least square (PLS) regression estimation technique was adopted for data analysis. In addition, common sample descriptive and Pearson correlation were also used to enhance data analysis. Findings of the research revealed that there was a positive and significant relationship between environmental, social and economic performance indicators and return on assets. Environmental and social performance indicators had a positive non-significant relationship with return on equity while economic performance indicators had a significantly positive relationship with return on equity. Based on the findings, it was concluded that sustainability reporting activities are important factors in enhancing financial performance. It is was recommended that oil and gas companies should properly articulate the environmental issues they intend to respond to on the basis of those that will have the most direct and largest effect on their financial performance. It is further suggested that companies conduct critical review of their corporate social activities and whittle down on those that do not make commensurate contribution to financial performance while at the same time channeling more resources to the more financial value enhancing activities. Finally, industry leaders and policy makers liaise to develop an industry standard and template for sustainability reporting that will be legally binding on all companies in the industry.

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Published
2023-04-30
How to Cite
Ohikhuare , I. L., & Christopher, E. C. (2023). Sustainability Reporting and Financial Performance of Quoted Oil and Gas Companies in Nigeria. Central Asian Journal of Innovations on Tourism Management and Finance, 4(4), 94-106. https://doi.org/10.17605/OSF.IO/5JTY9
Issue
Vol 4 No 4 (2023): April 2023
Section
Articles

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