SUSTAINABILITY REPORTING AND FINANCIAL PERFORMANCE OF LISTED INDUSTRIAL GOODS FIRMS IN NIGERIA
Keywords:
Economic Sustainability Reporting, Environmental Sustainability Reporting,, Financial Performance, Social Sustainability Reporting, Sustainability ReportingAbstract
The study examined the effect of sustainability reporting on the financial performance of industrial goods firms listed in Nigeria. The study specifically determined the effect of social sustainability reporting, economic sustainability reporting, environmental sustainability reporting and governance disclosures on Economic Value Added. The study adopted the ex-post facto research design. Thirteen listed industrial goods firms made up the population of the study. Purposive sampling was used to select the sample size of nine firms. The study used secondary data which were sourced from the annual reports of the firms over a thirteen year period (2012-2024). Descriptive analysis was carried out together with multicollinearity test, heteroskedasticity test, cross-sectional dependence test and Hausman specification test. Hypotheses were tested using panel least square regression, which revealed the following findings: social sustainability reporting has a positive and significant effect on Economic Value Added of listed industrial goods firms in Nigeria (β = 0.9083, p = 0.0000); economic sustainability reporting has a positive and significant effect on Economic Value Added of listed industrial goods firms in Nigeria (β = 4.4605, p = 0.0029); environmental sustainability reporting has a negative and significant effect on Economic Value Added of listed industrial goods firms in Nigeria (β = -0.5718, p = 0.0000); governance disclosures have a negative and significant effect on Economic Value Added of listed industrial goods firms in Nigeria (β = -2.0663, p = 0.0061). In conclusion, initiatives aimed at enhancing social welfare and economic stability, such as employee development, community engagement and infrastructure investment, are well-received by stakeholders and could translate into higher productivity, brand equity, and long-term financial gains. The study recommended that Industrial goods firms need to appoint sustainability officers in order to intensify and institutionalize social sustainability initiatives such as employee engagement programs, health and safety policies, and community development projects, as these have been empirically shown to contribute positively and significantly to economic value added, enhancing both social impact and financial performance.
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