Sustainability Reporting and Firm Performance: Evidence from Nigeria’s Listed Oil and Gas Sector

Abstract

This study examines impact of sustainability reporting on investor’s behavior in listed oil and gas firms in Nigeria for a period of (10) years ranging from 2014 to 2023. The study utilizes four dimensions of sustainability reporting, (Environmental, Social, Governance and Economic) sustainability reporting while Firm Performance been the dependent variable was proxied by Tobin Q and measured by Return on Asset. The study adopted ex-post facto research design while the population of the study comprised of all the (10) listed oil and gas firms as at 31 December, 2023. Census sampling was adopted while data was obtained from secondary sources due to the fact that it is a quantitative study based on positivism paradigm. Panel multiple regression was used for the analysis and the study conducted a test of descriptive statistics, correlation matrix as well as some post estimation econometrics test such as, normality test, heteroskedasticity, autocorrelation, and random effect model test. From the regression result, evidence indicates that a low significant positive relationship between environmental, social and governance sustainability reporting and Return on Asset, though the relationship was insignificantly low for social disclosure but a positive relationship with economic sustainability. Based on the above findings the study concluded that sustainability disclosure influences the return on Asset in the Nigeria capital market. The policy implication of the study is that firms that disclose sustainability reporting in their annual reports are likely to attract more investors. Therefore, in line with the conclusion the study recommends amongst others that firms should deliberately increase their disclosure of sustainability performance reporting in order to attract investors to their shares and therefore increase their market value.