Corporate Performance and Environmental Reporting by Local and Foreign Firms in Nigeria’s Petroleum Industry

Alhassan Haladu, Usman Sani Kofar Wambai and Mohammed Sani Abubakar

The study is primarily aimed at determining whether any significant relationship exists between environmental reporting and the economic performance of local and foreign companies in the petroleum industry. Pollution with regards to oil spillage, gas flaring and other ecological damages like toxic release by the petroleum industry have attained a level of devastating proportion leading to insecurity and human sufferings of epidemic proportion. True accountability in the sector will go a long way in alleviating these sufferings. All oil and gas firms quoted in the NSE were used in this research with four independent variables representing profitability, company size, financial leverage and market-to-book value. Data obtained was analysed with the use of robust regression tool of analysis. Results showed among other things, a significant relationship between environmental reporting and the economic performance of companies in the petroleum industry in general. Also local firms have a stronger environmental disclosure rate than foreign firms even though the rate of influence of foreign firms is more significant. Moreover, the research applied the latest version of GRI (G4) to examine a developing economy. In the light of this it is highly advisable that the current level of environmental disclosure be maintained and improved and mandatory environmental disclosure policies be embarked upon. The major limitation of this study however, lies in the fact that only registered firms in the NSE were considered.

DOI : https://doi.org/10.21102/graf.2016.09.72.08