Environmental and Social Accounting Practices, and Financial Performance of Cement Companies: Empirical Evidence from Nigeria

Engaging in environmental and social activities and disclosing same in the annual financial or sustainability report by business entities has been controversial for over three decades among stakeholders across different industries. Therefore, the objective in the research was to test the empirical nexus of social investment cost (SIC) and environmental protection cost (EPC) in relation to financial performance of quoted cement companies in Nigeria. Financial performance was further denominated into sales turnover (ST) and market value of firms (MVF) to respectively develop two hypotheses in their alternative forms. While the researchers adopted ex poste facto research design, secondary data were obtained from relevant annual financial reports and database of the Nigerian stock exchange for 2009-2017. Descriptive statistics were utilized for data presentation before estimating the test result by adopting multivariate regression model. However, the test result for H1 indicated significant P-value and F-value at 5% level of significance. In addition to accepting H1, positive Coefficients by SIC, EPC, and control variable (total assets-TA) demonstrated a strong adjusted R-square of 65.2483% association with ST, although, the coefficient for intercept was negative. Similarly, the test result for H2 also indicated significant P-value and F-value at 5% level of significance. In addition to accepting H2, positive coefficients of intercept, EPC, and the control variable, market capitalization (MCAP) of cement companies in Nigeria cumulatively contributed a weak adjusted R-square of 25.213% to MVF. However, the coefficient for SIC was negative. Besides observing low level and inconsistent environmental and social accounting practices (ESAP) among cement companies in Nigeria, the researchers concluded that such insignificant level of ESAP by such companies influenced their financial performance. Hence, the researchers recommended cement companies to adopt ethical approach towards expanding investment in ESAP. Keywords: Environmental and Social Accounting Practices, Corporate Social Responsibility Disclosures, Sustainability Reporting, Financial Performance, Accounting Measure of Financial Performance, Capital Market measure of Financial Performance DOI: 10.7176/EJBM/12-20-07 Publication date:July 31st 202

Social And Environmental Responsibility Accounting Practices and Market Value Of Quoted Oil And Gas Firms In Nigeria

Engaging in social and environmental activities as core components of CSR is rapidly growing as one of globally acceptable best practices for sustainability in business. Beyond their acclaimed societal benefits, the specific implication of social and environmental responsibility accounting practices (SERAP) on the economic performance of business entities is still a debate in many territories and industries. Therefore, the main objective in this study is to determine the nexus between SERAP and financial performance of quoted oil and gas firms in Nigeria. Whereas the measures of SERAP are environmental protection costs (EPC), community education and training costs (CETC), and community health related costs (CHRC), the proxy for financial performance is the market value of firms. Adopting ex post facto research design and modified Ohlson 1995 share price model, the general model demonstrated insignificant positive adjusted R-square. As all the P-values are not statistically significant, the unstandardised coefficients for EPC, CETC, and CHRC reveal a mix of positive and negative insignificant indices at varying extents. It was concluded that the level of SERAP by oil and gas firms in Nigeria did not significantly influence their capital market valuation. While the researcher further inferred that social and environmental public concerns rank as the primary responsibility of the government which receives taxes from business entities, oil and gas companies may cautiously engage in SERAP to avert financial losses through restiveness and agitations from some disgruntled stakeholders. More so, as ethical practices for promoting their going concern philosophy is mainly attainable within a wholesome planet and healthy people. Keywords: Social and Environmental responsibility Accounting Practices (SERAP), environmental protection costs, community education and training costs, community health related costs, Capital Market performance, Value of Oil and Gas Companies. DOI: 10.7176/EJBM/13-12-07 Publication date:June 30th 202