Environmental Risk Management and Financial Performance in Listed Multinational Firms in Nigeria

Azeez Oyebanji Abiola, Igbekoyi Olusola Esther and Adeyemo Foluke Helen
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Azeez Oyebanji Abiola: Afe Babalola University, Ado Ekiti, Ekiti, Nigeria
Igbekoyi Olusola Esther: Department of Accounting, Adekunle Ajasin University, Akungba-Akoko, Ondo State, Nigeria
Adeyemo Foluke Helen: Afe Babalola University, Ado Ekiti, Ekiti, Nigeria

International Journal of Research and Innovation in Social Science, 2024, vol. 8, issue 12, 50-74

Abstract: The study investigated the environmental risk management and financial performance in listed multinational firms in Nigeria considering the compliance with environmental regulations and minimizing environmental liabilities to avoid financial losses and reputational damage. This study employed ex-post facto research design. The population of this study comprised 46 firms listed on the Nigerian Exchange (NGX) as at 31st December, 2023. The entire population was selected as sample size using census sampling technique. Data were collected using secondary source. Spanning twelve years, from 2012 to 2023, the research aimed to observe long term trends and performance patterns. Data analysis was descriptive and inferential. The regression analysis showed that that environmental conservative practices had an insignificant negative effect on the return on assets (ROA) for listed multinational firms in Nigeria suggesting that adopting such practices does not play a critical role in enhancing financial performance. Conversely, risk assessment disclosures had a negative but significant effect on financial performance by showing a complex relationship between transparency and profitability. Disclosing environmental compliance, the findings showed a significantly negatively effects on return on assets which suggested that adherence to environmental regulations may impose considerable financial burdens on multinational firms in Nigeria. It was recommended that multinational firms participate in disclosures on environmental management efforts to boost investor confidence.

Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:bcp:journl:v:8:y:2024:i:12:p:50-74

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