Effect of Firm Characteristics on Sustainability Reporting of Listed Industrial Goods Firms in Nigeria

Abstract

With firm size, board size, and profitability serving as proxies of firm characteristics, this study examined the effect of firm characteristics on the sustainability reporting of listed industrial goods firms in Nigeria with a sample size of 13 listed industrial goods firms in Nigeria. By applying panel regression techniques, the study shows that firm size (z-value of 2.25, p-value of 0.024) and board size (z-value of 1.98, p-value of 0.048) have a significant positive effect on the sustainability reporting of listed industrial goods firms in Nigeria. In contrast, profitability (z-value of -0.43, p-value of 0.665) has an insignificant negative impact. The study concluded that an increase in firm size and board size will increase corporate sustainability reporting disclosure for industrial goods firms in Nigeria. However, an increase in profitability will reduce the level of corporate sustainability reporting of industrial goods firms in Nigeria, which implies that the level of profitability is not a crucial factor in decisions that relate to corporate sustainability disclosure. The study recommends that listed industrial goods firms in Nigeria should improve their net assets so as to enhance their sustainability disclosure. The management of listed industrial goods firms in Nigeria is also encouraged to have large board members with diverse experience, especially in business finance, to enhance their level of sustainability reporting disclosure.