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Paper titleENVIRONMENTAL ACCOUNTING DISCLOSURE AND SHAREHOLDERS’ VALUE MAXIMIZATION: EVIDENCE FROM NON-FINANCIAL FIRMS IN NIGERIA
Paper author
Offia, Anthonia C
Author Email
[email protected]
Abstract
This study examined the effect of environmental disclosure on shareholders’ value maximization: Evidence from non-financial firms listed in Nigeria Stock Exchange. Samples of 60 companies from different sectors were used for the period of ten years spanning 2011 to 2020. The study employed ex-post facto and cross-sectional research design. The secondary sources of data were collected from annual reports of the selected non-financial firms quoted in Nigeria stock exchange and three (3) specific objectives and hypotheses were tested and analyzed. Panel data were obtained from annual reports and accounts of the sampled non-financial firms and subjected to preliminary data tests such as descriptive analysis, correlation analysis, variance inflation factor analysis and Hausman effects tests for the period of ten years. Multiple panels least regression analysis was employed via E-Views 10. Using a sample of 600 firm-year observations, the result of the tested hypotheses revealed that environmental prevention disclosure has positive but insignificant effect on shareholders’ value maximization while environmental pollution disclosure has negative but insignificant effect on shareholders’ value maximization policy of selected non-financial firms. In the same vein, community development disclosure have negative and significant effect on shareholders’ value maximization policy of selected non-financial firms which was statistically significant at 5% level of significance The findings showed that about 59.5% of changes in total variation in the shareholders’ value maximization policy of selected nonfinancial firms can be attributed to the joint effect of all the explanatory variables while about 40.5% was unaccounted for thereby captured by the stochastic error term. The study recommends among others, that managers of non-financial firms should pay more attention towards community development in their host communities to boost their performance and hence add value to their shareholders’ wealth creation. Key words: Environmental accounting disclosure, Shareholders’ value maximization, non-financial firms
This study examined the effect of environmental disclosure on shareholders’ value maximization: Evidence from non-financial firms listed in Nigeria Stock Exchange. Samples of 60 companies from different sectors were used for the period of ten years spanning 2011 to 2020. The study employed ex-post facto and cross-sectional research design. The secondary sources of data were collected from annual reports of the selected non-financial firms quoted in Nigeria stock exchange and three (3) specific objectives and hypotheses were tested and analyzed. Panel data were obtained from annual reports and accounts of the sampled non-financial firms and subjected to preliminary data tests such as descriptive analysis, correlation analysis, variance inflation factor analysis and Hausman effects tests for the period of ten years. Multiple panels least regression analysis was employed via E-Views 10. Using a sample of 600 firm-year observations, the result of the tested hypotheses revealed that environmental prevention disclosure has positive but insignificant effect on shareholders’ value maximization while environmental pollution disclosure has negative but insignificant effect on shareholders’ value maximization policy of selected non-financial firms. In the same vein, community development disclosure have negative and significant effect on shareholders’ value maximization policy of selected non-financial firms which was statistically significant at 5% level of significance The findings showed that about 59.5% of changes in total variation in the shareholders’ value maximization policy of selected nonfinancial firms can be attributed to the joint effect of all the explanatory variables while about 40.5% was unaccounted for thereby captured by the stochastic error term. The study recommends among others, that managers of non-financial firms should pay more attention towards community development in their host communities to boost their performance and hence add value to their shareholders’ wealth creation. Key words: Environmental accounting disclosure, Shareholders’ value maximization, non-financial firms
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