Abstract

This study examines the financial performance of listed industrial goods firms in Nigeria from 2014 to 2024, a period during which return on investment, proxied by earnings per share (EPS) and profit after tax, declined significantly. Against this backdrop, responsibility accounting an emerging concept in accounting and finance is examined as a potential driver of improved financial performance, premised on the notion that socially responsible firms gain stakeholder respect and loyalty, which may translate into higher sales and performance. Sustainability reporting, proxied by social and environmental disclosures, is linked to firm value, with return on assets (ROA) serving as the proxy for financial performance. Using a correlational research design, data were collected from ten industrial goods firms listed on the Nigerian Exchange Group (NXG) over the 11‑year period and analysed via panel‑corrected standard error (PCSE) regression. The results show that sustainability reporting related to social disclosures has a negative effect (−0.381) on financial performance, whereas environmental disclosure has a positive effect (0.249). The study concludes that social‑sustainability reporting may hurt financial performance, while environmental‑sustainability reporting enhances it. The findings suggest that the Securities and Exchange Commission (SEC) should develop a comprehensive sustainability reporting framework aligned with the Global Reporting Initiative (GRI) and make sustainability reporting a statutory requirement in annual reports to strengthen accountability and reduce agency conflict between managers and shareholders.

Keywords

Financial Performance, environmental disclosure, sustainability reporting disclosure,

File: 1778339842_Vol_10_2__008.pdf

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