Title: Environmental Accounting Disclosure and Return on Assets: A Study of Listed Oil and Gas Firms in Nigeria
Authors: Adebayo Kehinde Oluwaseun & Odiba Paul Simon,
Volume: 10
Issue: 6
Pages: 134-150
Publication Date: 2026/06/28
Abstract:
Environmental accounting disclosure has become essential for firms to enhance transparency, regulatory compliance, and stakeholder accountability. In Nigeria, the oil and gas sector remains economically critical, yet the influence of environmental disclosure on financial performance is underexamined. This study, underpinned by legitimacy theory, adopted an ex-post facto design covering all eight oil and gas companies listed on the Nigerian Exchange Limited (NGX) from 2015 to 2024. Using multiple regression, the study examined the effect of environmental disclosure on Return on Assets (ROA), with effluent and waste disclosure (EFFW), compliance with environmental laws (COMP), and energy-related disclosure (ENER) as independent variables. The random effects model and Spearman correlation were employed. Findings revealed that effluent and waste disclosure had a negative and significant effect on ROA, indicating that increased reporting on waste management was associated with reduced financial performance. Compliance disclosure showed a positive and significant effect on ROA, suggesting that regulatory adherence enhanced profitability. Energy-related disclosure had a positive but statistically insignificant effect on ROA. The model was significant at the 5% level, with a substantial proportion of ROA variation explained by the disclosure variables. The study concluded that compliance-related disclosure is the main driver of financial performance in Nigeria's oil and gas sector. Recommendations include that listed firms improve the depth and quality of their environmental disclosures, and that regulators strengthen standardized reporting frameworks to enhance comparability and stakeholder confidence.