The International Institute for Science, Technology and Education (IISTE)
Abstract
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
