An Assessment of the Determinants of Environmental Costs of Listed Deposit Money Banks in Nigeria
Keywords:
Banks, Environmental Cost, Profitability, Company Size, Leverages.
Abstract
This paper assesses the determinants of environmental costs of Nigerian banking institutions. Looking at the influence of profitability, company size and leverages on environmental cost such as donation, gift and developments, the population of the study are deposit money banks in Nigeria. Using purposive sampling technique, the study selected all fifteen (15) banks listed on the Nigerian Stock Exchange websites as at June 31, 2019 in which their annual reports are available to be extracted. The study utilized archival data i.e the annual report of listed banks from 2014 – 2017 to extract the needed information. Using STATA 14 software, the study conducts diagnostic tests such as heteroskedasticity, multicollinearity and Pearson correlation for data examination. Hence, multiple regression analysis was conducted to investigate the influence of profitability, company size and leverages on environmental costs. The analysis of the study showed that profitability, company size and leverages have positive and significant association with the environmental cost reported by these banks. Therefore, the study recommended that to adapt to the changing system of doing business, accountants ought to be equipped with skills and knowledge about environmental accounting and reporting, and in order to enhance competitiveness, banks must design and apply environmentally friendly strategies.
References
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Semykina, A., & Wooldridge, J. M. (2013). Estimation of dynamic panel data models with sample selection. Journal of Applied Econometrics, 28(1), 47-61.
Skinner, D. J. (1994). Why firms voluntarily disclose bad news. Journal of accounting research, 32(1), 38-60.
Susi, S. (2005). The relationship between environmental performance and financial performance of Indonesian companies. Jurnal Akuntansi & Keuangan, 7, 89-98.
Shi, X. Y., & Ban, J. G. (2016). The Research on the Relationship Between Environmental Performance and Financial Performance. Journal of Finance and Accounting, 4(2), 81–85. https://doi.org/10.11648/j.jfa.20160402.18
Tabachnick, B. G., & Fidell, L. S. (2007). Multivariate analysis of variance and covariance. Using Multivariate Statistics, 3, 402–407.
Tilling, M. V., & Tilt, C. A. (2010). The edge of legitimacy: Voluntary social and environmental reporting in Rothman’s 1956–1999 annual reports. Accounting, Auditing, and Accountability Journal, 23(1), 55–81.
Zikmund, W. G., Carr, J. C., Griffi, M., & Fuller-jacobsen, B. (2010). Business Research Methods. South-Western, Cengage Learning, 8(1), 1–18.
Abbot, W.F., & Monsen, R.J. (1979). On the measurement of corporate social responsibility: self-reported disclosures as a method of measuring corporate socila involvement. Academy of Management Journal. 9(2), 65-71.
Ahmed, N. U., Montagno, R. V., & Naffzigger, D. W. (2003). Environmental concerns, effort and impact: an empirical stud. Mid-American Journal of Business, 18(1), 61-69.
Ayoib, C. A., Houghton, K. A., & Nor Zalina, M. Y. (2006). The Malaysian market for audit services: ethnicity, multinational companies and auditor choice. Managerial Auditing Journal, 21(7), 702–723. https://doi.org/10.1108/02656710210415703
Bassey, B. E., Effiok, S. O., & Eton, O. E. (2013). The Impact of Environmental Accounting and Reporting on Organizational Performance of Selected Oil and Gas Companies in Niger Delta Region of Nigeria, 4(3), 57–74.
Bhasin, M. L. (2016). The Challenge of Improving Corporate Governance by Creating Effective Audit Committees. International Journal of Management Sciences and Business Research, 5(8).
Bowman, E.H., & Haire, M. (1975). A strategic Posture Towards Corporate Social Responsibility. California Management Review, 18(2), 49-58.
Dowling, J., & Pfeffer, J. (1975). Organizational legitimacy: Social values and organizational behavior. Pacific Sociological Review, 18, 122–136.
Fry, F. L., & Hock, R. J. (1976). Who claims corporate social responsibility? "The biggest and the worst." Business and Society Review, 18(18), 62-65
Gujarati, D. N., & Porter, D. C. (2009). Causality in economics: The Granger causality test. Basic Econometrics (Fifth International Ed.). New York: McGraw-Hill.
Hair Jr, J. F., Black, W. C., Babin, B. J., Anderson, R. E., & Tatham, R. L. (2010). SEM: An introduction. Multivariate Data Analysis: A Global Perspective, 629–686.
Hair, J. F., Black, W. C., Babin, B. J., Anderson, R. E., & Tatham, R. L. (2010). Multivariate Data Analysis. Prentice Hall.
Henri, J. F., & Journeault, M. (2010). Eco-control: The influence of management control systems on environmental and economic performance. Accounting, Organizations and Society, 35(1), 63-80.
Herawaty, V. (2018). The effect of environmental performance and accounting characteristics to earnings informativeness The effect of environmental performance and accounting characteristics to earnings informativeness. In The 4th International Seminar on Sustainable Urban Development. https://doi.org/10.1088/1755-1315/106/1/012077
Hilmi. (2016). Effect of social and environmental performance financial performance of the company. European Journal of Accounting, Auditing and Finance Research, 4(9), 30–59.
Jensen, M. C., & Meckling, W. (1976). Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Finance Economics, 3.
Lako A. (2011). Deconstruction of CSR and Business Paradigm. Reform and Akuntansi.Jakarta. Erland.
Lang, M., & Lundholm, R. (1993). Cross-sectional determinants of analyst ratings of corporate disclosures. Journal of accounting research, 31(2), 246-271.
Leftwich, R. W., Watts, R. L., & Zimmerman, J. L. (1981). Voluntary corporate disclosure: The case of interim reporting. Journal of accounting research, 50-77.
McWilliams, A. & Siegel, D. (2000). Corporate social responsibility and financial performance: Correlation or misspecification? Strategic Management Journal, 21, 603–609.
Myers, S. C. (1977). Determinants of corporate borrowing. Journal of financial economics, 5(2), 147-175.
Mobus, J. L. (2005). Mandatory environmental disclosures in a legitimacy theory context. Accounting, Auditing, and Accountability Journal, 18(4), 492–517.
Owen, D. (2008). Chronicles of wasted time?: A personal reflection on the current state of, and future prospects for, social and environmental accounting research. Accounting, Auditing & Accountability Journal, 21(2), 240-267.
Pallant, J. (2011). SPSS Survival Manual 4th edition: A step by step guide to data analysis using SPSS version 18. Maidenhead, Berkshire: Open University Press. Retrieved on from http://www. allenandunwin. com/spss.
QinYing, and Wu-Chun Y. (2004). An relationship research on the theory and model between enterprise environmental performance and economic performance. Theory and Practice Research of system engineering, (8), 111-117.
Rakhiemah, A. N., & Agustia, D. (2009). Pengaruh kinerja lingkungan terhadap corporate social responsibility (CSR) disclosure dan kinerja finansial perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia. Simposium Nasional Akuntansi XII, 4-6.
Ramsey, J. B. (1974). Classical model selection through specification error tests. Frontiers in Econometrics, 13–47.
Sekaran, U., & Bougie, R. (2013). Research methods for business. In Research methods for business (p. 436).
Schiopoiu Burlea A., Popa I. (2013). Legitimacy Theory. In: Idowu S.O., Capaldi N., Zu L., Gupta A.D. (eds) Encyclopedia of Corporate Social Responsibility. Springer, Berlin, Heidelberg.
Selcuk, E. A., & Kiymaz, H. (2017). Corporate Social Responsibility and Firm Performance : Evidence from an Corporate Social Responsibility and Firm Performance : Evidence from an Emerging Market. Accounting and Finance Research, 6(4). https://doi.org/10.5430/afr.v6n4p42
Semykina, A., & Wooldridge, J. M. (2013). Estimation of dynamic panel data models with sample selection. Journal of Applied Econometrics, 28(1), 47-61.
Skinner, D. J. (1994). Why firms voluntarily disclose bad news. Journal of accounting research, 32(1), 38-60.
Susi, S. (2005). The relationship between environmental performance and financial performance of Indonesian companies. Jurnal Akuntansi & Keuangan, 7, 89-98.
Shi, X. Y., & Ban, J. G. (2016). The Research on the Relationship Between Environmental Performance and Financial Performance. Journal of Finance and Accounting, 4(2), 81–85. https://doi.org/10.11648/j.jfa.20160402.18
Tabachnick, B. G., & Fidell, L. S. (2007). Multivariate analysis of variance and covariance. Using Multivariate Statistics, 3, 402–407.
Tilling, M. V., & Tilt, C. A. (2010). The edge of legitimacy: Voluntary social and environmental reporting in Rothman’s 1956–1999 annual reports. Accounting, Auditing, and Accountability Journal, 23(1), 55–81.
Zikmund, W. G., Carr, J. C., Griffi, M., & Fuller-jacobsen, B. (2010). Business Research Methods. South-Western, Cengage Learning, 8(1), 1–18.
Published
2020-02-18
How to Cite
Lamidi, W. A., Oluwatuyi, A. O., Masunda, T., & Olagunju, A. (2020). An Assessment of the Determinants of Environmental Costs of Listed Deposit Money Banks in Nigeria. International Journal of Business and Management Future, 4(1), 12-20. https://doi.org/10.46281/ijbmf.v4i1.483
Section
Research Paper/Theoretical Paper/Review Paper/Short Communication Paper
Copyright (c) 2020 Wasiu Adebayo Lamidi , Adesola Olufunmilola Oluwatuyi, Tariro Masunda, Adebayo Olagunju
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