Social and Environmental Accounting and Performance of Banking Companies Quoted in Nigeria

Abstract

Since the 2007-2008 global financial crisis, which affected many large corporations, the performance of companies has come under scrutiny, and the corporate world has been forced to restructure its relationship with its stakeholders. For many years, stakeholders have been clamoring for greater accountability, and transparency from the management of companies on social and environmental matters. This paper studied the relationship between social and environmental accounting and performance of banking companies quoted in Nigeria, using <i>ex-post-facto</i> research design, while the total enumeration sampling technique was used in the selection of the 13 banking companies for a period of 10 years from 2011 - 2020. Descriptive and inferential statistics were used to analyze the data. The study's findings demonstrated that social and environmental accounting had a considerable impact on the return on capital employed (ROCE) of Nigerian banking organizations (<i>Adj R²</i> = 0.0367, <i>F-Stat </i>= 14.34, <i>p </i>= 0.0008) While the effect of social and environmental accounting disclosure on return on capital employed (ROCE) of Nigerian banking enterprises is moderated by firm size (Δ<i>Adj R²</i> = 0.1391, <i>F-Stat </i>= 7.95, <i>p </i>= 0.0001). According to the findings, social and environmental accounting has a substantial impact on the performance of Nigerian financial organizations. The study recommended that policies be made for the mandatory disclosure of social and environmental accounting information in the financial statement of firms.