DETERMINANTS OF SOCIAL AND ENVIRONMENTAL ACCOUNTABILITY OF NIGERIAN FIRMS

Abstract

Corporate organisations are following legal and illegal means to avoid and evade payment of corporate taxes considered as corporate burdens that erode profits as the main motive of businesses. Conversely, activities of corporate organisations are associated with depletion and destruction of natural resources and negative impacts on the society and environment and there are increasing pressure on corporate organisations to render social and environmental accountability. However, rendering such accountability is capable of further eroding profits; thus, corporate organisations may render less accountability with payment of corporate taxes. Therefore, the aim of this paper is to evaluate the relationship between corporate tax, size, profitability and leverage, and social and environmental accountability by listed Nigerian construction and building materials and pharmaceutical and healthcare companies from 2009 to 2018. Data on annual social and environmental disclosure are collected from the annual reports and accounts of 5purposively selected companies each as samples from population of 9 companies in the construction and 10 companies in the pharmaceutical industries. Social and environmental accountability is evaluated by obtaining quantity of disclosure using modified words count content analysis while panel regression analysis is conducted to determine the influence of chosen variables on the disclosure. Results from the study indicated that corporate size statistically explain CSED by construction companies while leverage is significant in pharmaceutical companies. Corporate tax is negatively related with CSED in construction industry while other variables are not significant. Stakeholder theory explain the disclosure practices which have the policy implications requiring more CSED by the two industries while public policy makers may regulate CSED in the two industries.