LONG RUN IMPLICATIONS OF GREEN ACCOUNTING ON SUSTAINABLE DEVELOPMENT IN NIGERIA
Keywords:
Green Accounting, Real Gross Domestic Product, Human Development index, Sustainable Development
Abstract
The objective of the study was to determine the long run effect of green accounting on sustainable development in Nigeria using data obtained from firms financial statement, CBN and world bank publication for Sustainable development data for the period 2003 to 2022. The study adopted panel cointegration tests, to evaluate the long run properties of the dataset with different integration and the Bounds test suited for autoregressive distributed lags used for testing the cointegration status for the three combination of variables that make up the model. The Pooled Mean Group (PMG) estimation technique was used in the empirical analysis to estimate the long-run and short-run relationship amongst the variables for the panel data. The study found green initiatives by companies on sustainable development in Nigeria are more long-term than short-term. Short-run effects are more negative and mostly insignificant while the long run stable effects give indication that these initiatives could help to address sustainable development problems in Nigeria. Economic cost has positive long run effects on human capital development. Only economic cost has significant effect on Human development index thus indicating that social and environmental sustainability policy by firms has failed to achieve improved human capital development. Result also show environmental expenditure has significant and negative impact on GDP growth in the short run but positive in the long run. Policy makers within the companies need to consider the sustainability policies as a long term planning strategy while also improving linkages of economic expenditures to GDP growth. Policy action by the firms and Government on sustainable development and green economic planning must consider long run implications and applicability in all economic segments. Government can energise green initiatives through manadatory payments tied to turnover or profit for environmental remediation with a deliberate policy on administration of such funds to improve sustainable growth.
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References
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Andania, N.P & Yadnya, P. (2020) The effect of sustainability report disclosure on t
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Aupperle, E. K., Carroll, B. A. & Hatfield, D. J., (1984). “An empirical examination of the relationship between corporate social responsibility and profitability. Research In Corporate Social Performance And Policy, 6(1),. 27-54.
Awan and Tahir (2015). Impact of working environment on employee’s productivity: A case study of Banks and Insurance Companies in Pakistan. European journal of Business Management 7(1)
Bachoo, K., Tan, R. & Wilson, M. (2013). Firm value and the quality of sustainability reporting in Australia. Australian Accounting Review, 23(1), 67-87
Banwarie, U. R. (2011). The relationship between ownership structure and CSR disclosure.
Benlemlih, M., & Bitar, M. (2018). Corporate social responsibility and investment efficiency. Journal of Business Ethics, 148(3), 647-671
Beredugo, S. B &Mefor, I. P. (2012). The Impact of environmental accounting and reporting on sustainable development in Nigeria. Research Journal of Finance and Accounting. 3
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Balabanis, G., Phillips, H.C. and Lyall, J. (1998) Corporate Social Responsibility and Economic Performance in the Top British Companies: Are They Linked. European Business Review, 9, 25-44.https://doi.org/10.1108/09555349810195529
Burhan, A. H., &Rahmanti, A (2012). The impact of sustainability reporting on company performance, Journal of Economics, Business, and Accountancy Ventra 15 (2), 257 -272.
Buys, P., Oberholzer, M. & Andrikopoulos, P., (2011). “An investigation of the economic performance of sustainability reporting companies versus non-reporting companies: A South African Perspective”. Journal of Social Sciences, 29(2), 151-158.
Caesaria, A.F & Basuki, B.(2017) Sustainability Report Disclosure to the Firm’s market performance.7T97/7M207<5 . DOI: 10.1051/73408001
Daly, H. E. (1996) Beyond Growth: The Economics of Sustainable Development, Boston: Beacon Press
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Ekwueme, C. M., Egbunike, C. F. &Onyali, C. I. (2013). Benefits of triple bottom line disclosures on corporate performance: An exploratory study of corporate stakeholders, Journal of Management and Sustainability, 3 (5), 79-91.
Elkington, J. (1994). Towards the sustainable corporation: Win-win-win business strategies for sustainable development. California management review, 36(2), 90-100.
Enekwe, C.,Ordu,M., Nwoha,C(2013).Effect of exchange rate fluctuations on manufacturing sector in Nigeria. European Journal of Business and Management,5(22).67-73
Erhirhie, F. E & Ekwueme C, M (2019) Corporate social sustainability reporting and financial performance of oil and gas industry in Nigeria. International Journal of Accounting, Finance and Risk Management. 4(2): 44-60
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Greyson, J. (2015) “A Glance at Waste-Free Economy.” http://www.ecomena. org/tag/linear-economy/.GRI (2011). Sustainability reporting guidelines, version 3.1.
Iliemena, R. 0. (2020) Environmental accounting practices and corporate performance: study of listed oil and gas companies in Nigeria. European Journal of Business and Management, 12(22), 2222-2839
IsaR., IsaF., OvosimohammedB., & Kabir Haruna Danja(2016). The Impact of Green Accounting on Economic Developmentof Nigeria.International Journal of Advanced Studies in Business Strategies and Management 4(2), July,
Iliemena, R. O. &Amedu, J.M.A. (2019). Effect of standard costing on profitability of manufacturing companies: study of Edo state Nigeria. Journal of Resources Development and Management, 53, 28 - 34.wvvw.researchgate.net
Juhmani (2014). Determinants of corporate social and environmental disclosure on websites, Universal Journal of Accounting and Finance 2(4)
Karlsson, J. (2015). Corporate sustainability and financial performance - The influence of board diversity in a Swedish context, (published Master’s thesis). Department of Business Studies, Uppsala University. Sweden.
Moneva. (2002).Accountability and Accounting Regulation: The Case of the Spanish Environmental Disclosure Standard.” European Accounting Review 11 (4): 723-740. https://doi.org/10.1080/096381802200000100Q.
Michael Nugent AND Huggins(2009)Developing an International Assurance Standard on Greenhouse Gas Statements Accounting Horizons 23(4) DOI:10.2308/acch.2009.23.4.347
Lins, K. V., Servaes, H., & Tamayo, A. (2017). Social capital, trust, and firm performance: The value of corporate social responsibility during the financial crisis. The Journal of Finance, 72(4), 1785-1824
Manchiraju, Hariom and Rajgopal, Shivaram (2017) Does Corporate Social Responsibility (CSR) Create Shareholder Value? Evidence from the Indian Companies Act 2013 (February 9, 2017). Journal of Accounting Research, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2602960 or http://dx.doi.org/10.2139/ssrn.2602960
Liu, Sen, Yang Yang, and Yuan Liu Qu. (2016). “The Business Value of Cloud Computing: The Partnering Agility Perspective.” Industrial Management & Data Systems 116 (6): 1160-1177. https://doi.Org/l 0.1108/02635570710734262.
Ndukwe, O.D &Nwakanma,G.N(2017).Corporate sustainability reporting and firm profitability: A survey of selected quoted companies in Nigeria. Journal of Finance, Banking and Investment. 4(2), 1-15.
Nnamani, J. N., Onyekwelu, U. L. & Ugwu, O. K. (2017).Effect of sustainability accounting and reporting on financial performance of firms in Nigeria brewery sector. European Journal of Business and Innovation Research, 5 (1), 1-15.
Ofuogbu, G.N & Asogwa, C.U(2020).The effect of sustainability reporting on profitability of quoted consumer goods manufacturing firms in nigeria. International Journal of Innovative Research and Development .9(4), 2278 - 0211 DOI10.24940/ijird/2020/v9/i4/APR20075
Ogbonna, T. E., Onuoha, J. C., Igwe, F.Ojeaburu (2020). Environmental accounting and sustainability development in Nigeria.West African Journal of Business and management sciences62-89, VOL 9(4)
Omkar D.&Amacha,B (2017). Sustainability Practices as Determinants of Financial Performance: A Case of Malaysian Corporations. Journal of Asian Finance Economics and Business 4(2):55-68. DOI:10.13106/jafeb.2017.vol4.no2.55
Onder S.(2018)Impact of sustainability performance of company on its financial performance: an empirical study on borsaistanbul(bist). DumlupinarUniversitesiSosyalBilimlerDergisi
Onyekwelu&Ekwe (2014). Does corporate social responsibility predicate good financial performance. ESUT Journal of Management Sciences, 8(1)1-10
Pearce, D. W. (1993) Economic Values and the Natural World, Cambridge, Mass.: MIT Press
Preston, L. E. &O'bannon, D. P. (1997). The corporate social-financial performance relationship: A typology and analysis. Business & Society, 36(4), 419-429.
Utile, B. J ,Tarbo, D .1 & Ikya, E A(2017). Corporate environmental reporting and the financial performance of listed manufacturing firms in Nigeria. International Journal of Advanced Academic Research. 3(8) 2488-9849
Uwalomwa U., et.al (2018) Sustainability reporting and firm performance: a bi-directional approach. Academy of Strategic Management Journal 17(3)
Van Marrewijk, M. (2003). Concepts and definitions of CSR and corporate sustainability: Between agency and communion. Journal of business ethics, 44(2-3), 95-105.
Velis, C. A. (2015). Circular Economy and Global Secondary Material Supply Chains. Waste Management & Research 33 (5): 389-391.
https://doi.org/! 0.1177/0734242x15587641
Velte, P. (2017). Does ESG performance have an impact on financial performance? Evidencefrom Germany. Journal of Global Responsibility, 8(2), 169-178.
Verrecchia, R. E. (2001). Essays on disclosure. Journal of accounting and economics, 32(1 - 3), 97-180.
Waddock, S. A. & Grave, S. B., (1997). The Corporate social performance financial performance link”. Strategic Management Journal, 18(4), pp. 303-319
Wong, R &Millington,A( 2014).Corporate social disclosures: a user perspective on assurance," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 27(5), 863-887, June
Yong G.,& Brent D. (2008). Developing the circular economy in China: Challenges and opportunities for achieving ‘leapfrog development’ International Journal of Sustainable Development & World Ecology 15, 231–239 DOI 10.3843/SusDev.15.3:6
Zhao, C., Guo, Y., Yuan, J., Wu, M., Li, D., Zhou, Y., & Kang, J. (2018). ESG and Corporate Financial Performance: Empirical Evidence from China’s Listed Power Generation Companies. Sustainability, 10(8), 2607.
Amacha, E. B., & Dastane, O. (2017). Sustainability practices as determinants of financial performance: A Case of Malaysian Corporations. Journal of Asian Finance, Economics and Business, 4 (2), 55-68.
Amedu, J.M., Iliemena, R.O. &Umaigba, F.T. (2019). Value relevance of sustainability reporting in Nigerian manufacturing companies. Journal of Global Accounting, 6(2), 131-147.
Amran, A. &Haniffa, R. (2011), “Evidence in development of sustainability reporting: a case of a developing country”, Business Strategy/ and the Environment, 20(3) 141 - 156.
Andania, N.P & Yadnya, P. (2020) The effect of sustainability report disclosure on t
Anderson, M.J. 2006. Distance-Based Tests for Homogeneity of Multivariate Dispersions. Biometrics, 62:245-253.
Aupperle, E. K., Carroll, B. A. & Hatfield, D. J., (1984). “An empirical examination of the relationship between corporate social responsibility and profitability. Research In Corporate Social Performance And Policy, 6(1),. 27-54.
Awan and Tahir (2015). Impact of working environment on employee’s productivity: A case study of Banks and Insurance Companies in Pakistan. European journal of Business Management 7(1)
Bachoo, K., Tan, R. & Wilson, M. (2013). Firm value and the quality of sustainability reporting in Australia. Australian Accounting Review, 23(1), 67-87
Banwarie, U. R. (2011). The relationship between ownership structure and CSR disclosure.
Benlemlih, M., & Bitar, M. (2018). Corporate social responsibility and investment efficiency. Journal of Business Ethics, 148(3), 647-671
Beredugo, S. B &Mefor, I. P. (2012). The Impact of environmental accounting and reporting on sustainable development in Nigeria. Research Journal of Finance and Accounting. 3
Buallay, A., Hamdan, A., &Zureigat, Q. (2017). Corporate governance and firm performance: evidence from Saudi Arabia. Australasian Accounting, Business and Finance Journal, 11(1), 78-98.
Balabanis, G., Phillips, H.C. and Lyall, J. (1998) Corporate Social Responsibility and Economic Performance in the Top British Companies: Are They Linked. European Business Review, 9, 25-44.https://doi.org/10.1108/09555349810195529
Burhan, A. H., &Rahmanti, A (2012). The impact of sustainability reporting on company performance, Journal of Economics, Business, and Accountancy Ventra 15 (2), 257 -272.
Buys, P., Oberholzer, M. & Andrikopoulos, P., (2011). “An investigation of the economic performance of sustainability reporting companies versus non-reporting companies: A South African Perspective”. Journal of Social Sciences, 29(2), 151-158.
Caesaria, A.F & Basuki, B.(2017) Sustainability Report Disclosure to the Firm’s market performance.7T97/7M207<5 . DOI: 10.1051/73408001
Daly, H. E. (1996) Beyond Growth: The Economics of Sustainable Development, Boston: Beacon Press
Deegan, C. (2000). Financial Accounting Theory ‘Australia: The McGraw-Hill Companies, Inc.
Ekwueme, C. M., Egbunike, C. F. &Onyali, C. I. (2013). Benefits of triple bottom line disclosures on corporate performance: An exploratory study of corporate stakeholders, Journal of Management and Sustainability, 3 (5), 79-91.
Elkington, J. (1994). Towards the sustainable corporation: Win-win-win business strategies for sustainable development. California management review, 36(2), 90-100.
Enekwe, C.,Ordu,M., Nwoha,C(2013).Effect of exchange rate fluctuations on manufacturing sector in Nigeria. European Journal of Business and Management,5(22).67-73
Erhirhie, F. E & Ekwueme C, M (2019) Corporate social sustainability reporting and financial performance of oil and gas industry in Nigeria. International Journal of Accounting, Finance and Risk Management. 4(2): 44-60
Gray, R. (2007). Taking a long view on what we now know about social and environmental accountability and reporting. Issues in Social and Environmental Accounting, 1(2), 169-198.
Gray, R., Kouhy, R., & Lavers, S. (1995), ‘Methodological themes: Constructing a research database of social and environmental reporting in UK companies’, Accounting, Auditing and Accountability Journal, 8 (2), 78-101.
Greene, W. H (2003).Econometric analysis (5th ed.), Prentice Hall, Upper Saddle River.
Greyson, J. (2015) “A Glance at Waste-Free Economy.” http://www.ecomena. org/tag/linear-economy/.GRI (2011). Sustainability reporting guidelines, version 3.1.
Iliemena, R. 0. (2020) Environmental accounting practices and corporate performance: study of listed oil and gas companies in Nigeria. European Journal of Business and Management, 12(22), 2222-2839
IsaR., IsaF., OvosimohammedB., & Kabir Haruna Danja(2016). The Impact of Green Accounting on Economic Developmentof Nigeria.International Journal of Advanced Studies in Business Strategies and Management 4(2), July,
Iliemena, R. O. &Amedu, J.M.A. (2019). Effect of standard costing on profitability of manufacturing companies: study of Edo state Nigeria. Journal of Resources Development and Management, 53, 28 - 34.wvvw.researchgate.net
Juhmani (2014). Determinants of corporate social and environmental disclosure on websites, Universal Journal of Accounting and Finance 2(4)
Karlsson, J. (2015). Corporate sustainability and financial performance - The influence of board diversity in a Swedish context, (published Master’s thesis). Department of Business Studies, Uppsala University. Sweden.
Moneva. (2002).Accountability and Accounting Regulation: The Case of the Spanish Environmental Disclosure Standard.” European Accounting Review 11 (4): 723-740. https://doi.org/10.1080/096381802200000100Q.
Michael Nugent AND Huggins(2009)Developing an International Assurance Standard on Greenhouse Gas Statements Accounting Horizons 23(4) DOI:10.2308/acch.2009.23.4.347
Lins, K. V., Servaes, H., & Tamayo, A. (2017). Social capital, trust, and firm performance: The value of corporate social responsibility during the financial crisis. The Journal of Finance, 72(4), 1785-1824
Manchiraju, Hariom and Rajgopal, Shivaram (2017) Does Corporate Social Responsibility (CSR) Create Shareholder Value? Evidence from the Indian Companies Act 2013 (February 9, 2017). Journal of Accounting Research, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2602960 or http://dx.doi.org/10.2139/ssrn.2602960
Liu, Sen, Yang Yang, and Yuan Liu Qu. (2016). “The Business Value of Cloud Computing: The Partnering Agility Perspective.” Industrial Management & Data Systems 116 (6): 1160-1177. https://doi.Org/l 0.1108/02635570710734262.
Ndukwe, O.D &Nwakanma,G.N(2017).Corporate sustainability reporting and firm profitability: A survey of selected quoted companies in Nigeria. Journal of Finance, Banking and Investment. 4(2), 1-15.
Nnamani, J. N., Onyekwelu, U. L. & Ugwu, O. K. (2017).Effect of sustainability accounting and reporting on financial performance of firms in Nigeria brewery sector. European Journal of Business and Innovation Research, 5 (1), 1-15.
Ofuogbu, G.N & Asogwa, C.U(2020).The effect of sustainability reporting on profitability of quoted consumer goods manufacturing firms in nigeria. International Journal of Innovative Research and Development .9(4), 2278 - 0211 DOI10.24940/ijird/2020/v9/i4/APR20075
Ogbonna, T. E., Onuoha, J. C., Igwe, F.Ojeaburu (2020). Environmental accounting and sustainability development in Nigeria.West African Journal of Business and management sciences62-89, VOL 9(4)
Omkar D.&Amacha,B (2017). Sustainability Practices as Determinants of Financial Performance: A Case of Malaysian Corporations. Journal of Asian Finance Economics and Business 4(2):55-68. DOI:10.13106/jafeb.2017.vol4.no2.55
Onder S.(2018)Impact of sustainability performance of company on its financial performance: an empirical study on borsaistanbul(bist). DumlupinarUniversitesiSosyalBilimlerDergisi
Onyekwelu&Ekwe (2014). Does corporate social responsibility predicate good financial performance. ESUT Journal of Management Sciences, 8(1)1-10
Pearce, D. W. (1993) Economic Values and the Natural World, Cambridge, Mass.: MIT Press
Preston, L. E. &O'bannon, D. P. (1997). The corporate social-financial performance relationship: A typology and analysis. Business & Society, 36(4), 419-429.
Utile, B. J ,Tarbo, D .1 & Ikya, E A(2017). Corporate environmental reporting and the financial performance of listed manufacturing firms in Nigeria. International Journal of Advanced Academic Research. 3(8) 2488-9849
Uwalomwa U., et.al (2018) Sustainability reporting and firm performance: a bi-directional approach. Academy of Strategic Management Journal 17(3)
Van Marrewijk, M. (2003). Concepts and definitions of CSR and corporate sustainability: Between agency and communion. Journal of business ethics, 44(2-3), 95-105.
Velis, C. A. (2015). Circular Economy and Global Secondary Material Supply Chains. Waste Management & Research 33 (5): 389-391.
https://doi.org/! 0.1177/0734242x15587641
Velte, P. (2017). Does ESG performance have an impact on financial performance? Evidencefrom Germany. Journal of Global Responsibility, 8(2), 169-178.
Verrecchia, R. E. (2001). Essays on disclosure. Journal of accounting and economics, 32(1 - 3), 97-180.
Waddock, S. A. & Grave, S. B., (1997). The Corporate social performance financial performance link”. Strategic Management Journal, 18(4), pp. 303-319
Wong, R &Millington,A( 2014).Corporate social disclosures: a user perspective on assurance," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 27(5), 863-887, June
Yong G.,& Brent D. (2008). Developing the circular economy in China: Challenges and opportunities for achieving ‘leapfrog development’ International Journal of Sustainable Development & World Ecology 15, 231–239 DOI 10.3843/SusDev.15.3:6
Zhao, C., Guo, Y., Yuan, J., Wu, M., Li, D., Zhou, Y., & Kang, J. (2018). ESG and Corporate Financial Performance: Empirical Evidence from China’s Listed Power Generation Companies. Sustainability, 10(8), 2607.
Published
2024-07-17
How to Cite
Henry Inokon, I., & A Umobong, A. (2024). LONG RUN IMPLICATIONS OF GREEN ACCOUNTING ON SUSTAINABLE DEVELOPMENT IN NIGERIA. GPH-International Journal of Social Science and Humanities Research, 7(06), 49-73. https://doi.org/10.5281/zenodo.12759677
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Firozpur Jhirka, Haryana, India
