Ownership Structure and Environmental Disclosure among Nigerian Listed Firms
DOI:
https://doi.org/10.33003/fujafr-2024.v2i3.118.23-36Keywords:
Environmental Disclosure, Managerial Ownership, Foreign Ownership, Government Ownership, Institutional OwnershipAbstract
The study investigated the effect of ownership settings on Nigerian listed firms’ environmental disclosure for the period 2012 – 2022. The predicting variables includes managerial ownership, foreign ownership, government ownership, and institutional ownership. A correlational approach was adopted to explore the variables’ natural relationships. Published annual reports of 95 Nigerian listed firms were used as a source of secondary data. The extent of environmental disclosure by the sampled firms was measured using the Global Reporting Index (GRI). Panel regression analysis revealed that foreign, government and institutional ownership have a significantly positive effect on environmental disclosure among Nigerian listed firms. Although, the findings did not yield conclusive evidence on a link between managerial ownership and environmental disclosure among the companies. The results of this study are crucial for regulatory authorities, stakeholders and policymakers, as it pinpoint the most effective strategies for firms to address environmental disclosure challenges and highlight key factors that drive and enhance environmental transparency. As a result, the study recommended that the industry regulators should work together with government in revitalizing the nation’s economy which in turn encourage more investment from foreign investors. Additionally, management should prioritize and encourage government and institutional holding in the Nigerian listed firms as there monitoring characteristics can enhance firm's environmental disclosure practices.
References
Abu Qa’dan, M. B., & Suwaidan, M. S. (2019). Board composition, ownership structure and corporate social responsibility disclosure: the case of Jordan. Social Responsibility Journal, 15(1), 28–46.
Acar, E., Çalıyurt, K.T. & Zengin-Karaibrahimoglu, Y. (2020). Does ownership type affect environmental disclosure? Does ownership type affect environmental disclosure? International Journal of Climate Change Strategies and Management, 13(2), 120-141.
Adeyemi, A. E., & Oraegbunam, I. K. E. (2021). Business corporations and effective corporate governance. International Review of Law and Jurisprudence (IRLJ), 3(2), 180–188.
Akrout, M.M, & Othman, H.B. (2016). Ownership structure and environmental disclosure inMENA emerging countries. Corporate Ownership and Control, 13(4), 381 – 388.
Al Amosh, H., & Mansor, N. (2020). The implications of ownership structure on the environmental disclosure in Jordan. International Journal of Academic Research in Business and Social Sciences, 10(3), 330–346.
Aliyu, U. S. (2019). Board characteristics and corporate environmental reporting in Nigeria. Asian Journal of Accounting Research, 4(1), 2–17.
Al-Janadi, Y. (2021). Ownership structure and firm performance in the Middle East: A meta-analysis. Journal of Risk and Financial Management, 14(12), 577.
Altawalbeh, M. A. (2020). Corporate governance mechanisms and firm’s performance: Evidence from Jordan. Accounting and Finance Research, 9, 11-25.
Arif, M., Sajjad, A., Farooq, S., Abrar, M., & Joyo, A. S. (2020). The impact of audit committee attributes on the quality and quantity of environmental, social and governance (ESG) disclosures. Corporate Governance (Bingley), 21(3), 497–514.
Augustine, A. & Francis, U. (2023). Board characteristics: An empirical study on environmental disclosure in Nigerian oil and gas firms. International Journal of Research (IJR), 10(6), 44 - 54.
Chang, K. (2013b). The effects of ownership and capital structure on environmental information disclosure: Empirical evidence from Chinese listed electric firms. TERI Information Digest on Energy and Environment, 12(3), 315–330.
Chang, K., & Le, Z. (2015). The effects of corporate ownership structure on environmental information disclosure empirical evidence from unbalanced penal data in heavy-pollution industries in China. WSEAS Transaction on System and Control, 10(1), 405–414.
Cek, K., & Eyupoglu, S. (2020). Does environmental, social and governance performance influence economic performance? Journal of Business Economics and Management, 21(4), 1165–1184.
Che-Adam, N., Lode, N. A., & Abd-Mutalib, H. (2019). The influence of board of directors’ characteristics on the environmental disclosure among Malaysian companies. Malaysian Management Journal, 23, 1-25.
Darnall, N., Ji, H., Iwata, K., & Arimura, T. H. (2022). Do ESG reporting guidelines and verifications enhance firms’ information disclosure? Corporate Social Responsibility and Environmental Management, 29(5), 1214–1230.
Dewi, N.A, & Honggowati, S. (2023). Social and environmental disclosure in Indonesia: Does ownership matter? Journal of Accounting and Investment, 24(3), 877-895.
Ellili, N. O. D. (2020). Environmental, social, and governance disclosure, ownership structure and cost of capital: Evidence from the UAE. Sustainability (Switzerland), 12(18), 1–23.
Ezhilarasi, G., & Kabra, K. C. (2017). “The Impact of corporate governance attributes on environmental disclosures: Evidence from India.” Indian Journal of Corporate Governance.
Fama, E. (1980). Agency problems and the theory of the firms. Journal of Political Economy, 88(2), 288–307.
Fama, E., & Jensen, M. (1983). Separation of ownership and control. Journal of Law and Economics, 1(2), 301–325.
Fitri, E. R., Savitri, E., & L, A. A. (2019). Influence of foreign ownership, ownership concentrated, and environmental disclosure to firm value. Indonesian Journal of Economics, Social, and Humanities, 1(2), 91–96.
Fuadah, L. L., Mukhtaruddin, M., Isni, A. & Anton, A. (2022). The Ownership structure, and the environmental, social, and governance (ESG) disclosure, firm value and firm performance: The audit committee as moderating variable. Economics 10, 1-16.
Gerged, A.M. (2020). Factors affecting corporate environmental disclosure in emerging markets: The role of corporate governance structures. Business Strategy and Environment, 1 -20.
GRI. (2013). Sustainability reporting policies worldwide: today's best practice, tomorrow's trends. https://www.globalreporting.org/resourcelibrary/carrots-and-sticks.pdf
Haddad, A.E., AlShattarat, W.K., AbuGhazaleh, N.M. & Nobanee, H. (2015). The impact of ownership structure and family board domination on voluntary disclosure for jordanian listed firms”, Eurasian Business Review, 5(2), 203-234.
Hallgren, A. & Johansson, J. (2016). Determinants of disclosure quality: A study of environmental liability disclosures. http://hdl.handle.net/2077/47115
Haque, F., & Ntim, C. G. (2018). No Title. Business Strategy and the Environment, Environment, 27(3), 347–364.
Hassan, A. M., Roberts, L., & Atkins, J. (2020). Exploring factors relating to extinction disclosures: What motivates companies to report on biodiversity and species protection? Business Strategy and the Environment, 29(3), 1419–1436.
Hassan, O. A., & Romilly, P. (2018). Relations between corporate economic performance, environmental disclosure and greenhouse gas emissions: New insights. Business Strategy and the Environment, 27(7), 893–909.
Hendri, S., & Puteri, K. (2015). Impact of corporate governance on corporate environmental disclosure: Indonesian evidence, International Conference on Trends in Economics, Humanities and Management (ICTEH' 15), August 12 - 13, Pattaya (Thailand).
Ibrahim, R., Ibrahim, Y. K., & Hussain, M. S. (2023). Environmental reporting and financial performance of listed industrial and consumer goods firms in Nigeria. FUDMA Journal of Accounting and Finance Research [FUJAFR], 1(2), 123–140.
Ifada, L. M., & Indriastuti, M. (2021). Government ownership, international operations, board in-dependence and environmental disclosure: Evidence from Asia–Pacific. Jurnal Dinamika Akuntansi, 13(2), 131–147.
Ika, S. R., Nugroho, J.P., Achmad, N. & Widagdo, A. K. (2021). The impact of corporate governance on environmental reporting: Evidence from the Indonesian manufacturing industry. IOP Conf. Series: Earth and Environmental Science.
Ji, M., & Ji, Y. (2022). Environmental accounting information disclosure driving factors: The case of listed firms in China. Sustainability, 15797(14), 1–23.
Jubaedah, S. & Stiawan, D. (2023). The effect of ownership structure on social and environmental disclosure in Indonesia. Diponegoro. International Journal of Business, 6(1), 24 – 35.
Khaireddine, H., Salhi, B., Aljabr, J., & Jarboui, A. (2020). Impact of board characteristics on governance, environmental and ethical disclosure. Society and Business Review, 15(3), 273-295.
Khlif, H., Ahmed, K. & Souissi, M. (2017), “Ownership structure and voluntary disclosure: a synthesis of empirical studies”, Australian Journal of Management, 42(3), 376-403.
Kim, J. B., & Yi, C. H. (2015). Foreign versus domestic institutional investors in emerging markets: Who contributes more to firm-specific information flow? China Journal of Accounting Research, 8(1), 1–23.
Kolk, A., Hong, P., & Dolen, W. Van. (2018). Corporate social responsibility in China: An Analysis of Domestic and Foreign Retailers’. Business Strategy and the Environment, 5(12), 289–303.
Mamman, B. M. (2021). Audit committee: Size, independence and environmental disclosure of Non-finance service companies in Nigeria: The moderating role of audit committee share ownership. Journal of Finance and Accounting, 12(8), 14–46.
Masud, M. A. K., Nurunnabi, M., & Bae, S. M. (2018). The effects of corporate governance on environmental sustainability reporting: empirical evidence from South Asian countries. Asian Journal of Sustainability and Social Responsibility, 3(1), 1–26.
Matta, R. (2017). Ownership structure and corporate environmental disclosure: Evidence from India. International Journal of Science Technology and Management, 6(6), 106–119.
Musa, H.M. (2023). The moderating effect of institutional shareholders on the relationship between board attributes and auditor selection among listed financial service firms’ in Nigeria. FUDMA Journal of Accounting and Finance Research (FUJAFR), 1(2), 16 – 32.
Morck, R., Shleifer, A. & Vishny, R.W. (1988). Management ownership and market valuation: An empirical analysis. Journal of Financial Economics, 20. 293 -315.
Nigerian Code of Corporate Governance, 1 (2018).
Nurleli. (2016). “Effect of environmental information disclosure on financial performance”. Journal of Accounting Studies, 16(1), 31–54.
Oh, W. Y., Chang, Y. K., & Cheng, Z. (2016). When CEO career horizon problems matter for corporate social responsibility: The moderating roles of industry-level discretion and block holder ownership. Journal of Business Ethics, 133(2), 279–291.
Ong, T. T., Tho, H. S., Goh, H. H., Thai, S. B., & Teh, B. (2019). The Relationship between environmental disclosure and financial performance of public listed companies in Malaysia. International Business Management, 10(4), 461–467.
Pasaribu, M.Y. & Sulasmiyati, S., (2016). Effect of Profitability on firm values with managerial ownership as a variable control. Jurnal Administrasibisnis, 35(1), 154-164.
Rabi, M. (2019). Board Characteristics and Environmental Disclosure: Evidence from Jordan. International Journal of Business and Management, 14(2), 57–65.
Razaq, A. G., Alhassan, A., & Ame, J. (2023). Effect of Corporate Attributes on Sustainability Reporting of Listed Non-Financial Firms in Nigeria. FUDMA Journal of Accounting and Finance Research [FUJAFR], 1(2), 156–170.
Salehi, M., Tarighi, H., & Rezanezhad, M. (2017). The relationship between board of directors’ structure and company ownership with corporate social responsibility disclosure: Iranian angle. Humanomics, 33(4), 398-418.
Samaha, K., Khlif, H., & Hussainey, K. (2015). The impact of board and audit committee characteristics on voluntary disclosure: A meta-analysis. Journal of International Accounting, Auditing and Taxation, 24, 13–28.
Shahab, Y., Ntim, C. G., Chengang, Y., Ullah, F., & Fosu, S. (2018). Environmental policy, environmental performance, and financial distress in China: Do top management team characteristics matter? Business Strategy and the Environment, 27(8), 1635–1652.
Shin, I., & Park, S. (2020). Role of foreign and domestic institutional investors in corporate sustainability: Focusing on r&d investment. Sustainability (Switzerland), 12(20), 1–13.
Singal, P. A., & Putra, I. N. W. A. (2019). Pengaruh kepemilikan institusional, kepemilikan manajerial, dan kepemilikan asing pada pengungkapan corporate social responsibility. E-Jurnal Akuntansi, 29(1), 468-484.
Sintyawati, N. L. A., & Dewi, M. R. (2018). The effect of GCG on company value with financial performance as an intervening variable. E-Jurnal Manajemen Universitas Udayana, 7(2),
Song T, Xiong A (2023) Environmental disclosure practices in mixed ownership models: A study of Chinese private enterprises. Environmental economy and private enterprises. 18(11), 1 - 20.
Sufian, M.A, & Zahan, M. (2013). Ownership structure and corporate social responsibility disclosure in Bangladesh. International Journal of Economics and Financial, 3(4), 901-909
Tsang, A., Frost, T., & Cao, H. (2023). Environmental, social, and governance (ESG) disclosure: a literature review. The British Accounting Review, 55(1), 1–23.
Ullah, I., Fang, H., & Jebran, K. (2020). Do gender diversity and CEO gender enhance firm’s value? Evidence from an emerging economy. Corporate Governance (Bingley), 20(1), 44–66.
Umukoro, O. E., Uwuigbe, O. R., Uwuigbe, U., Adegboye, A., Ajetunmobi, O., & Nwaze, C. (2019). Board expertise and sustainability reporting in listed banks in Nigeria. Journal of Energy and Sustainable Environment, 3(1), 1–10.
Watanabel, N., Yamauchi, S., & Sakawa, H. (2022). The board structure and performance in IPO firms: Evidence from Stakeholder-Oriented. Corporate Governance. Sustainability (Switzerland), 14(13), 1–15.
Wei, M., Wang, Y. & Giamporcaro, S. (2024). The impact of ownership structure on environmental information disclosure: Evidence from China. Journal of Environmental Management, 1-14.
Xu, X., Abbas, H. S. M., Sun, C., Gillani, S., Ullah, A., & Raza, M. A. A. (2021). Impact of globalization and governance determinants on economic growth: An empirical analysis of Asian economies. Growth and Change, 52(2), 1137–1154.
Yadav, S. (2020). Institutional ownership and corporate social performance in emerging economies multinationals: Evidence from India. Indian Journal of Corporate Governance, 13(2), 227–252.
Yardimci, B., & Durak, M. G. (2022). Analysis of sustainability disclosures using a GRI based evaluation methodology. International Journal of Contemporary Economics and Administrative Sciences, 12(2), 799–828.
Zhang, J. Wu, W. (2024). The impact of foreign ownership on corporate ESG performance. Finance Research Letters, 66.
Downloads
Published
Issue
Section
License
Copyright (c) 2024 Haruna Muhammed Musa
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
The FUDMA Journal of Accounting and Finance Research (FUJAFR) operates a copyright policy that ensures a balance between author rights and wide dissemination of scholarly work.
1. Author Copyright Retention
Authors retain full copyright of their published work without restriction. Submission to FUJAFR does not transfer ownership of copyright to the journal.
2. License to Publish
By submitting a manuscript and upon acceptance, authors grant FUJAFR:
- The right to publish, reproduce, and distribute the article
- The right to identify itself as the original publisher of the work
This grant is non-exclusive, meaning authors are free to reuse their work in other contexts, provided proper acknowledgment of the original publication in FUJAFR is made.
3. Licensing of Published Content
All articles are published under the:
Creative Commons Attribution-NonCommercial License (CC BY-NC 4.0)
Under this license:
- Users may share and adapt the work for non-commercial purposes only
- Proper attribution to the author(s) and the journal is required
- Any commercial use requires explicit permission from the copyright holder
4. Author Reuse Rights
Authors are permitted to:
- Archive their published articles in institutional repositories or personal websites
- Share their work for educational and research purposes
- Reuse portions of their work in future publications (e.g., books or other articles), provided proper citation of the original publication is included
5. Third-Party Content
Authors are responsible for obtaining permission to use any third-party copyrighted material (e.g., images, tables, datasets) included in their manuscripts. Proper acknowledgment must be provided where required.
6. Attribution Requirement
All users of FUJAFR content must provide appropriate credit, including:
- Author name(s)
- Article title
- Journal name (FUJAFR)
- Year of publication
