DEBT FINANCING AND ENVIRONMENTAL SUSTAINABILITY DISCLOSURE OF LISTED OIL AND GAS FIRMS IN NIGERIA
Keywords:
Debt to Equity Ratio, Financial Mix, Long term Debt, Short Term DebtAbstract
This study examined the effect of debt financing on environmental sustainability disclosure of listed oil and gas firms in Nigeria for a period of eleven (11) years covering from 2012-2022. Specifically, this study ascertained the effect of debt ratio, short term debt ratio and long term debt ratio on environmental remediation disclosure. Panel data were used in this study, which were obtained from the annual reports and accounts of ten (10) sampled listed oil and gas firms for the periods 2012-2022. Ex-Post Facto research design and content analysis was employed. Inferential statistics using Pearson correlation coefficient and Panel Least Square (PLS) regression analysis were applied to test the hypotheses of the study. The results revealed that debt ratio has a significant and negative effect on environmental remediation disclosure (β1 = -0.063575; p-value = 0.0000); short term debt ratio has a significant and positive effect on environmental remediation disclosure (β2 = 0.018174; p-value = 0.0000); long term debt ratio has a significant and positive effect on environmental remediation disclosure (β3 = 0.100742; p-value = 0.0000). In conclusion, the study upholds that debt finance significantly affects environmental sustainability disclosure of listed Oil and Gas firms in Nigeria at 5% level of significance. It was recommended amongst others that firms should lever on the amount of debt they undertake to finance their undertakings, as it enhances firms’ bottom line. Also, that firms should operate with a capital structure mix that would minimize the cost of capital and reducing the reputational risks associated with the company's operations
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