Firms’ Financial Characteristics and Sustainability Reporting of Listed Manufacturing Companies in Nigeria

ABSTRACT
In today’s world as relates to economic perspective, the level of sustainability reports and what factors influencing business corporations to engage in sustainability report (SR) is becoming a global issue. Thus, the study empirically examined the firms’ characteristics and the level of sustainability reporting of listed manufacturing firms in Nigeria. Three hypotheses were formulated in line with the objectives of the study. Ex-post facto research design was adopted in the study. The study population was made up of 28 quoted industrial and natural resources manufacturing firms in Nigeria. Sample size of 23 was determined using Taro Yamane’s formula while purposive sampling technique was used to select the samples. Secondary sources of data were collected through content analysis method based on sustainability index with 28 items in line with International Integrated Reporting Council (IIRC, 2013) and reviewing of the firms’ annual reports from 2014-2023. The data obtained were analysed using descriptive statistics and multiple regression analysis. Findings revealed that the manufacturing firms reported sustainability issues in their annual reports at an average level of 24.3% (that is, environmental reporting – 6.8%, social and relationships – 9%, human resources reporting – 4.2% and intellectual – 5.6%) as at December 31, 2023. The results also revealed that liquidity and firm size have significant positive influence on sustainability reporting; leverage has significant negative influence on sustainability reporting. Thus, it was concluded from the study that firms’ financial characteristics are predicted to aggregately determined sustainability reporting in Nigeria. It was recommended among others that there is serious need to improve sustainability reporting by the stringent mandatory reporting, efforts of the Big 4 auditors and NSE are highly needed for sustainability reporting by firms while making a clarion call for integrated reporting (IR) adoption soonest in Nigeria.