Environmental Disclosures and Profitability of Non-Financial Services Firms In Nigeria: Moderating Role of Female Board Membership

Abstract

With female board membership serving as the moderator, this study investigated the moderating role of female board membership on the nexus between environmental disclosures and profitability of non-financial services firms in Nigeria using a panel dataset from 2011 to 2021. The population and sample size of the study comprises of 74 and 41 listed non-financial services firms respectively using the judgmental sampling technique. By applying a panel regression techniques, the study revealed that the employee relations disclosure positively and insignificantly affects return on assets, quality assurance disclosure positively and significantly affect return on assets, while local community disclosure have insignificant negative effect on return on assets. From the perspective of moderation effect, this study also found out that only female board membership-quality assurance disclosures negatively and significantly moderated the relationship between environmental disclosure and return on assets of the sampled firms. This study concluded that there is no moderating effect of female board membership on the relationship between female board membership-employee relations, female board membership-local community disclosure and return on assets of non-financial services firms in Nigeria. Therefore, it was recommended that the management of non-financial services firms in Nigeria should exercise care over the expenditure to be incurred on quality of products. In the same vein, Female Board Membership could be considered for other purposes and not as moderator so, as to prevent further adverse effect on profitability of sampled firms. It underscores the urgent need for employing competent female members into board based on their technical and professional expertise instead of political affiliations.