Environmental Costs and Performance of Listed Service Companies In Nigeria

Abstract

This study examined the relationship between environmental costs and performance measuresof listed service companies in Nigeria. Research questions and hypotheses were developed in line with the specific objectives of this study. The ex-post facto research design was adopted and the theoretical framework of this study was anchored on stakeholder’s theory. Secondary data with respect to the dependent and independent variables were obtained for a period of 10 years spanning from 2009-2018. The data obtained were analyzed using descriptive and inferential statistical techniques. Based on the test of hypotheses, it was found that environmental costs have significant relationship with the performance measures of firms. Specifically, it was observed among others that the level of environmental costs was significantly affected by return on assets (ROA), return on equity (ROE) and earnings per share (EPS). On the basis of the findings, it was recommended among others that the management of firms should ensure full disclosure by reporting environmental related costs in their financial statements irrespective of the performance recorded in any given year. Additionally, as a matter of fact, the accounting regulatory framework should consider developing environmental disclosure index in order to facilitate the disclosure of environmental related costs by firms.