Effect of Ownership Structure on Environmental Disclosure of Listed Consumer Goods Companies in Nigeria

Abstract

The insufficiency of financial statements to meet both financial and non-financial needs of various stakeholders has created the vacuum of information asymmetry, thereby raising agency costs of connected interest groups in firms. Ownership structure, to some extent, has narrowed the gap of information asymmetry, posing a new challenge that owners might comprise their environmental disclosure responsibility.This study examines effect of ownership structure on environmental disclosureof listed consumer goods companies in Nigeria. The study measures ownership structures with institutional, managerial, foreign and ownership concentrationas independent variables, while environmental disclosure, as a dependent variable is measured with the extent of the environmental disclosures in annual reports and financial statements of listed consumer goods companies based on GRI environmental disclosure criteria. The study adopts ex post facto research design relying on secondary collected from the population, consumer goods companies listed on the Nigerian Stock Exchange for the period 2011-2020. The study used multiple regression analysis to test the hypotheses with the aid of E-views 9.The results of the regression analysis show thatinstitutional investment has a positive and statistically significant effecton environmental disclosures. On the other hand, managerial ownership has a negative and statistically significant effecton environmental disclosures of listedconsumer goods companies in Nigeria. However, other independent variables are found to be insignificant to the extent of environmental disclosure. The study concluded that the ownershipstructure is an important corporate attribute for predicting the level of environmental disclosures of firms.Hence, it is recommended that Government and relevant regulatory agencies should consider a review of ownership structureof listed firms in Nigeriato be robustly composed to cater for diverse interests of various stakeholder groups.