Environmental Disclosure, Audit and Financial Performance of Listed Oil and Gas Companies in Nigeria.
Main Article Content
Abstract
This study investigated the effect of environmental disclosure and audit on the financial performance of listed oil and gas companies on the Nigerian Stock Exchange as of 31st December 2020, spanning from 2011-2020. The study adopted ex-post facto research design a sample of 11 companies were selected out of the 13 listed oil and gas companies on the Nigeria Stock Exchange. Panel data regression was used to analyze the effect of environmental disclosure and environmental audit on financial performance and the result of the analysis showed that environmental disclosure has a significant effect on returns on assets (ROA), Profits After Tax (PAT) and returns on equity (ROE) of listed oil and gas companies in Nigeria and environmental Audit has no significant effect on returns on assets (ROA) and Profits After Tax (PAT), but it significantly affects the returns on equity (ROE of listed oil and gas companies in Nigeria). It was then concluded that environmental disclosure and audit improves the financial performance of the selected oil and gas companies. The study implored the oil and gas companies to develop and implement environmentally friendly policies to increase their profitability.
Article Details
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
References
Alhassan, I. & Anwarul-Islam, K. M. (2019). The Impact of Environmental and Social Disclosures on the Financial Performance of Oil and Gas Companies in Nigeria. The Millennium University Journal, 4(1), 33-44.
Bassey, B.E., Effiok, S.O. and & Efon, O.E. (2013). The Impact of Environmental Accounting and Reporting on Organizational Performance of Selected Oil and Gas Companies in Niger-Delta of Nigeria, Research Journal of Finance and Accounting, 4(3), 57-73.
Beredugo, S. B. & Mefor, I. P. (2012). The impact of environmental accounting and reporting on sustainability development in Nigeria. Research Journal of Finance and Accounting, 3 (7), 55-63.
Braam, G. and Peeters, R., (2018). Corporate sustainability performance and assurance on sustainability reports: Diffusion of accounting practices in the realm of sustainable development. Corporate Social Responsibility and Environmental Management, 25(2), 164-181.
Cho, C. H., & Patten, D. M. (2007). The role of environmental disclosures as tools of legitimacy: A research note. Accounting, Organizations and Society, 32(7–8), 639–647.
Emeakponuzo, D. E., & Udih, M. (2015). Environmental accounting practices by corporate firms in emerging economies: Empirical evidence from Nigeria. Advances in Research, 3(2), 209-220.
Erhinyoja, E. F. & Marcella, E. C. (2019), corporate social sustainability reporting and financial performance of oil and gas industry in Nigeria. International Journal of Accounting, Finance and Risk Management, 4(2), 2019, 44–60.
Farrukh, I. & Faizan, N. (2016). Financial performance of firms: Evidence from Pakistan cement industry. Journal of Teaching and Education, 5(1), 81-94.
Gatimbu, K. K., & Wabwire, J. 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.
Gillet-Monjarret, C., and Riviere-Giordano, G. (2017). Sustainability assurance: A literature review. Comptabilité-Contrôle-Audit, 23(2), 11-62.
Ida, A.P. & Gerianta, W. Y. (2017). Effect of Company Size, Profitability, Industrial Type and Circle Performance on Environmental Disclosure, E-Journal Akuntansi Universitas Udayana, 20(3), 2362-2391.
Iliemena, R. O. C. & Okolocha, C. B. (2019). Effect of audit quality on financial performance: evidence from a developing capital market. International Journal of Recent Research in Commerce Economics and Management (IJRRCEM), 6(3), 191-198.
Irwansyah, I. (2017). Research-based environmental law: The debate between ecology versus development. Scimango Journal and Country Rank, 1 (1), 44-66.
Ismail, M. & Rahman, T. (2016). Environmental management accounting: an empirical investigation of manufacturing companies in Malaysia, The Academy of Management Journal, 27(1), 42-56.
Izat, R. (2019). Reflection of the Application of Environmental Auditing to Support the Process of Sustainable Development -Study in a Sample of Industrial Companies in the Kurdistan Region of Iraq. Journal of Al Anbar, 26(11),368-398.
Lodhia, S. (2005). Legitimacy motives for world wide web (www) environmental reporting: An exploratory study into present practices in the Australian minerals industry. Journal of Accounting and Finance, 4, 1 - 15.
Magara, R., Aming, N.N., & Momanyi, E. (2015). Effect of environmental accounting on company financial performance. British Journal of Economics, Management, and Trade, 10(1), 1-11.
Marwa, M., Salhi, B., & Jaboui, A. (2020). Environmental audit and environmental disclosure quality, scientific annals of economics and business. 67(1), 1-23.
Milto, Y. (2017). “Efficiency of Law in Innovation Environment”. Interdisciplinary Approach to Law in Modern Social Context. 4th International Conference of Ph.D. Students and Young Researchers. 21-22 April 2017, Vilnius University Faculty of Law Vilnius, Lithuania.
Nkwoji, N. (2021). Environmental accounting and profitability of selected quoted oil and gas companies in Nigeria (2012-2017). Journal of Accounting and Financial Management, 7(3), 22-39.
Norhasimah, R. E. (2016). The effects of environmental disclosure on financial performance in Malaysia. Procedia Economics and Finance, 117 – 126
Nwaimo, S. C. (2020). Effect of environmental cost on performances of quoted firms in Sub – Saharan Africa. European Journal of Accounting, Auditing and Finance Research, 8(7), 97 120.
Nwaiwu, N. J. & Oluka, N. O. (2018). Environmental cost disclosure and financial performance of oil and gas in Nigeria. International Journal of Advanced Academic Research, 4 (2), 1 – 23.
Ogoun, I. S. & Ekpulu, G. A. (2020). Environmental Reporting and Operational Performance: A Study of Listed Manufacturing Firms in Nigeria. International Journal of Intellectual Discourse, 3(1), 381-396
Okegbe A. I., & Ofurum, G., (2019). Health Challenges of Nigerian Urbanisation Paper Presented at 9th Benjamin Olukayode Osuntokun memorial. Lecture Presented at University College Hospital (UCH) Ibadan.
Olayinka, A. O. & Oluwamayowo, I. O. (2014). Corporate Environmental Disclosures and Market Value of Quoted Companies in Nigeria, The Business and Management Review, 5(3), 171-184.
Omaliko, E. L., Nweze, A. U. & Nwadialor, E. O.(2020). Effect of social and environmental disclosures on the performance of non-financial firms in Nigeria, Journal of Accounting and Financial Management, 6(1), 67-84.
Ong, T.S., Tho, H.S., Goh, H.H., Thai, S.B. & Teh, B.H. (2016). The relationship between environmental disclosure and financial performance of public listed companies in Malaysia. International Business Management, 10(4); 461-467.
Pahuja, S. (2019). Relationship between environmental disclosures and corporate characteristics: a study of large manufacturing companies in India, Social Responsibility Journal, 5 (2), 227-244.
Polycarp, S. U. (2019). Environmental Accounting and Financial Performance of Oil and Gas Companies in Nigeria, Research Journal of Finance and Accounting, 10(10), 192-200.
Solomon, P. J. (2020). Environmental Disclosure and Financial Performance of Listed Oil and Gas Companies in Nigeria: A Review on Literature, Journal of Business and Management, 22(9), 58-66.
Uniamikogbo, E. & Ifeanyichukwu, A. (2021). Environmental accounting disclosure and financial performance of manufacturing firms in Nigeria. Journal of Economics and International Business Management, 9(2), 71-81.
Van de Burgwal, D., & Vieira, R. J. O. (2014). Environmental disclosure determinants in Dutch listed companies. Revista Contabilidade & Finanças - USP, 25(64), 60–78.
Yusoff, H. N. (2013). Understanding environmental audit in the public sector: Malaysian perspective. JurnalTeknologi, 62(1), 25-30.
Zeng, S.X., Xu, X.D., Yin, H.T., & Tam, C.M. (2012). Factors that drive Chinese listed companies in voluntary disclosure of environmental information. Journal of Business Ethics, 109(3), 309-321.