EFFECT OF ENVIRONMENTAL AND SOCIAL DISCLOSURE ON MARKET VALUE OF LISTED MANUFACTURING FIRMS IN NIGERIA
Abdulkarim Shaibu Alhassan, PhD, Doshiro Musa Umar, PhD and Imong, Nelly Raphael
Volume 5 Issue 1
Abstract
The study examined the effect of economic, social and environmental disclosure on market value of manufacturing firms in Nigeria from 2014 to 2023. Market value was measured by Tobins Q. The study adopts ex-post facto research design while panel multiple regression was used for the analysis. From the panel multiple regression, it was discovered that environmental disclosure has negative significant effect on market value while social disclosure has negative insignificant effect on market value. Thus, the study concludes that increase in environmental disclosure will decrease market value of manufacturing firms in Nigeria while social disclosure has no statistically effects on market value of manufacturing firms in Nigeria within the period under consideration. Given the negative impact of environmental disclosure on market value, it is recommended that manufacturing companies adopt a more strategic approach to social and environmental disclosure. Companies should focus on transparently communicating the long-term benefits of their environmental initiatives to investors and other stakeholders, emphasizing how these initiatives can lead to cost savings, risk management, and potential revenue generation over time. Additionally, companies should engage in active investor relations to clarify any misconceptions regarding the financial impact of environmental investments. It is also crucial for companies to integrate environmental practices that align with core business strategies, ensuring that such initiatives do not merely increase operational costs but add value to the company’s long-term growth and stability. Keywords: Environmental disclosure, Social disclosure, Market Value, Tobins Q
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