Board Attributes and Environmental Disclosure Quality of Quoted Industrial Goods Companies in Nigeria

Abstract

This study examines effect of board attributes on environmental disclosure quality of quoted industrial goods companies in Nigeria. The study measures board attributes with Board Size, Board Independence and Board Financial Expertise as Independent Variables, while Environmental Disclosure Quality, as a dependent variable is measured with the extent of the environmental disclosures of quoted industrial goods companies in annual reports and financial statements based on Global Reporting Initiative (GRI) G4 environmental disclosure criteria. The study adopts ex post facto research design relying on secondary collected from the population, industrial goods companies quoted on the Nigerian Stock Exchange for the period 2010 -2019. The study used multiple regression analysis to test the hypotheses. From Hausman test conducted which favoured random test model, the study found pooled OLS regression model appropriate. According to the results of the regression analysis, only board size has a statistically significant and positive relationship with the extent of environmental disclosure. This result implies that firms with larger boards disclose more environmental information than firms with smaller boards. On the other hand, the rest of the independent variables are found to be unrelated to the extent of environmental disclosure. The low degree of independence and financial expertise on the boards of the sampled companies for the period analyzed in the study could be one possible explanation for this result. Hence, it is recommended that industrial goods companies should have larger board size which might contain individuals with diverse competences including accounting and finance.