SUSTAINABILITY REPORTING AND FINANCIAL PERFORMANCE OF LISTED OIL AND GAS FIRMS IN NIGERIA

Sustainability report is a report produced by firms which disclose their economic, environmental and social performance. These reports are normally geared toward the attainment of the United Nations sustainable development goals (SDGs). Even though compliance is voluntary in Nigeria, its effects on firm’s financial performance are enormous and as a result, it is essential for firm’s prosperity as well as better financial performance. This study examines the effect of sustainability reporting on financial performance of quoted Nigerian oil and gas firms. The population of the study comprises 12 listed oil and gas firms in Nigeria. Census sampling technique was adopted and filter was used. For firm to be selected it must be listed on or before 1st January 2009 and remain listed up to 31st December 2019. The firm must also publish their annual reports for the relevant period of the study. Based on these, five firms that failed to meet the set criteria were filtered out. This study makes use of Return on Asset to measure financial performance. Secondary source was used to collect the relevant data. Data in relation to sustainability reporting were extracted from the firm’s annual reports as well as standalone sustainability reports. However, data in relation financial performance were collected from the firm’s annual reports. Data for this study were analyse using STATA 13 statistical software. The regression result revealed that economic sustainability has a positive insignificant effect on ROA; environmental sustainability has a positive significant effect on ROA while social sustainability has a positive insignificant effect on ROA. Based on the findings, this study therefore, concludes that sustainability reporting has a significant effect on the financial performance of listed oil and gas firms in Nigeria. This study therefore, recommends among others that, listed Nigerian oil and gas firms should emphasize more on reporting their sustainability activities as it is capable of improving their financial performance. The policy makers and standard setting organisations should facilitate the issuance of a sector specific reporting guidelines to facilitate compliance