Sustainability Reporting and Operational Performance of Selected Environmentally Sensitive Firms in Nigeria

This study investigated the impact of sustainability reporting on the operational performance of environmentally sensitive firms listed on the Nigerian Exchange Group (NGX). Employing an ex post facto research design, the study utilized secondary data derived from the annual and sustainability reports of eight firms between 2019 and 2024. Environmental, social, and governance (ESG) disclosure indices were developed via content analysis, utilizing a binary scoring methodology aligned with the Global Reporting Initiative (GRI) framework. Analytical procedures included descriptive statistics, correlation analysis, panel least squares regression, heteroskedasticity testing, and the Hausman specification test. The results indicate that while environmental and governance reporting have positive but statistically insignificant effects on operational performance, social reporting exerts a negative and statistically insignificant influence. Conversely, firm age exerted a significant negative impact on operational performance. The Hausman test supported the selection of the random effects model as the preferred estimator. The findings indicate that while sustainability reporting enhances transparency, accountability, and stakeholder confidence, its influence on the operational performance of environmentally sensitive firms in Nigeria remains limited. The study recommends that firms move beyond mere disclosure compliance, strengthen governance frameworks, and align social investment strategies with core operational objectives.

Environment Reporting, Social Reporting, Governance Reporting, Operating Margin Ratio, GRI, Nigeria

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