THE MODERATING EFFECT OF SUSTAINABILITY DISCLOSURE ON FIRMS FINANCIAL PERFORMANCE EVIDENCE FROM NIGERIA AGRICULTURAL FIRMS’

Uthman Fatimah Zahra, Yusuf Abiodun Sarafadeen and Abdulrasheed Jamiu Alabere (ACA)
Volume 4 Issue 1

Abstract

Generally, financial performance has becoming crucial in measuring sustainability of companies’ performance most importantly agricultural firms’ across developed and developing countries. As a result of declined in firms’ financial performance which have resulted from in ability of companies disclosing some non-financial information such as carbon emission, air pollution and other environmental hazardous. In the light of these issues, this study investigates the effect of environmental expenditure and social innovations investments on financial performance of listed Agricultural Firms’ in Nigeria. Ex-post facto research design was used. As at 2024, five (5) companies were consistently listed in the floor of Nigeria Exchange Group (NGX), data were obtained in the annual report from 2014 to 2023 which equivalent to 50 year annual reports, therefore, it become the population and sample size of this study, correlation technique were adopted as inferential statistics. The result indicated that there is correlation between Return on Asset (ROA) based on Environmental Expenditure (EE) and Social Innovations Investment (SII). Firstly, R which is the coefficient of correlation between the EE and actual values resulted to moderate positive correlation (0.638). Secondly, the result shows that SII explains 41.9% of the variance in Return on Asset (ROA). The SII has a moderate positive correlation with ROA (R = 0.647). Therefore, this study concludes that their positive relationship between Environmental Expenditure (EE) and Social Innovations Investment (SII) on financial performance of listed Agricultural firms’ in Nigeria. In the light of these, this study recommends that Agricultural firms should be regularly engaged with stakeholders to understand their sustainability expectations and priorities. Keyword: Sustainability disclosure, Environmental Expenditure, Social Innovation Investment, Return on Asset (ROA)

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