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Download the complete economics project topic and material (chapter 1-5) titled THE EFFECT OF ENVIRONMENTAL ACCOUNTING AND REPORTING ON CORPORATE PERFORMANCE OF SELECTED OIL AND GAS COMPANIES IN NIGERIA here on PROJECTS.ng. See below for the abstract, table of contents, list of figures, list of tables, list of appendices, list of abbreviations and chapter one. Click the DOWNLOAD NOW button to get the complete project work instantly.

 

PROJECT TOPIC AND MATERIAL ON THE EFFECT OF ENVIRONMENTAL ACCOUNTING AND REPORTING ON CORPORATE PERFORMANCE OF SELECTED OIL AND GAS COMPANIES IN NIGERIA

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  • Name: THE EFFECT OF ENVIRONMENTAL ACCOUNTING AND REPORTING ON CORPORATE PERFORMANCE OF SELECTED OIL AND GAS COMPANIES IN NIGERIA
  • Type: PDF and MS Word (DOC)
  • Size: [82 KB]
  • Length: [77] Pages

CHAPTER ONE

CHAPTER ONE

INTRODUCTION

1.1       BACKGROUND OF STUDY

In recent years, environmental issues have become a major social focus and an issue of increased public concern (Beck et al. 2010). This concern has given rise to greater impetus for disclosure of the environmental and social impacts of modern corporate (Guthrie & Farneti, 2008), especially as these disclosures are seen by some to have commercial imperative (Spence, 2007).

Before the 1960s, environmental issues did not attract much attention from either modern big organizations or government (Dunlap, 1997). However, during the 1980s the public became increasingly interested and focused on environmental issues such as pollution and resource consumption (Dunlap, 1997). The interest was driven in part by concerns about the impact of pollution on individuals in society. This interest is reflected, for example, by the improvements made to the European community Environmental Policy (ECEP) in the 1970s. These improvements reflected the European community concerns about the quality of people’s lives and improving life expectancy. These improvements are outlined in the adoption of several principles in relation to the environment such as pollution and the action that could be implemented to prevent this and protect the environment (Hildebran, 1997).

Since the 1960s there have been several changes in the society including rapid advances in the information technology sector and the education of customers and consumers (McClosky & Smith, 1997), which have contributed to the environments becoming a more significant societal issue. The public’s concern for the environment and the impact of companies on the environment has been discussed for a number of decades, particularly in reference to countries such as Great Britain, Germany, Nertherland, North America, New Zealand and Australia (Dunlap, 1997). For example, research conducted by Simintiras et al, (1997) in the 1990s found that 73% of UK consumers were concerned about the environment. It is viewed that human activities are acknowledged as having the greatest impact on society and the environment. An example of this is that many scientists have argued that human activities are the major cause of global warming and environmental damage (Unerman et al, 2007). Environmental accounting has been defined by (Gray at al. 1987) as the process of communicating the social and environmental effects of organizations’ economic actions to particular interest group within society and to society at large. As such it involves extending the accountability of organizations (particularly companies) beyond the traditional role of providing a financial account to the owners of capital, in particular, shareholders. Such an extension is predicated upon the assumption that companies do have wider responsibilities than simply to make money for the shareholders (Gray et al 1987).

Consistently with the increase in public concern of environmental issues, environmental accounting practice has received attention from the scholars in the area of accounting research. Since the early 1970s, a number of academics researchers have studied environmental accounting in different countries from different perspectives. This increase in the number of environmental accounting studies is reflected in several academic journals providing special issues, for instance Research Journal of Accounting, 2012; Journal of Sustainable Development 2011; Research Journal of Finance and Accounting, 2013; Accounting Auditing & Accountability Journal, 1991; Accounting Forum, 1995; European Accounting Review, 2000 and Journal of corporate Citizenship, 2004.

1.2       STATEMENT OF THE PROBLEM

Environmental accounting involves the process of communicating the social and environmental effects of organizations’ economic actions to particular interest group within society and to society at large. As such it involves extending the accountability of organizations (particularly companies) beyond the traditional role of providing a financial account to the owners of capital, in particular, shareholders. Such an extension is predicated upon the assumption that companies do have wider responsibilities than simply to make money for the shareholders (Gray et al, 1987). In this case it is a comprehensive approach to ensure good corporate governance that includes transparency in its social activities. The unserious attitudes of several firms not to take environmental accounting into consideration make performance below expectation. This is because environmental accounting helps the firm to record all environmental costs incurred by the business, thereby finding a way of reducing the cost (environmental expenses), so that business can increase profit. Also environmental accounting helps companies to disclose to the outside world their ability to be environmental friendly. Some of the specific issues (problems) regarding the environmental accounting and disclosure include:

Identification of environmental cost and expenses

Capitalization of cost

Identification of environmental liabilities

Measurement of liabilities

At present, no accounting standard has been issued for accounting treatment of these specific problems (Bassey, 2013). Some guidelines regarding these issues have been issues by many organizations such as international chamber of commerce, the Japanese Industry Association, and Chemical Manufacturing Association. As regard environmental disclosure, different organizations have also issued guidelines, but these guidelines are only advisory in nature and not mandatory. Consequently, the researcher interest is therefore to investigate the effect of environmental accounting and reporting on corporate performance of selected Nigerian oil and gas companies.

1.3       OBJECTIVES OF THE STUDY

 

The main objective is to examine the effect of environmental accounting and reporting on corporate performance of selected oil and gas companies in Nigeria. The specific objectives are:

  1. To ascertain how environmental costs influence firms profitability.
  2. To ascertain if employees’ satisfaction influences corporate performance?
  • To determine the extent a firm’s size affects its voluntary disclosure of environmental information.
  1. To identify the effect of environmental disclosures on corporate
    • RESEARCH QUESTIONS

The questions arising which are addressed in this study are:

  • To what extent do employees’ satisfactions affect corporate performance?
  • To what extent do environmental costs influence the profitability of firms in Nigeria?
  • To what extent do environmental disclosures affect firm’s profitability?
  • To what extent does a firm’s size affects its voluntary disclosure of environmental information?

1.5       RESEARCH HYPOTHESES

The following hypotheses were formulated for the study:

Hoi:     There is no significant relationship between Environmental costs and firms’ profitability.

Hoii:    There is no significant relationship between employees’ satisfaction and      corporate performance.

Hoiii:   There is no significant relationship between Environmental disclosures and corporate performance.

Hoiv:   A firm’s size does not affect its voluntary disclosure of environmental information.

1.6       SIGNIFICANCE OF THE STUDY

The research work will be of benefits to Nigeria growing economy, in both the oil producing communities, the stakeholders in oil sector, and Nigerian state at large. The current oil spillage and gas flare in Niger-delta region, which is on the high side, will be reduced drastically, if companies and communities are exposed to the effect of environmental accounting and reporting.

1.7       SCOPE AND LIMITATIONS OF THE STUDY

This study carried out investigations spanning through mainly the Oil & Gas sector. The study investigated the Oil and Gas companies among listed in the Nigeria Stock Exchange and non- listed companies on joint venture account. The Oil & Gas sector comprised of companies in the upstream as well as marketing and distributions. There are (20) twenty companies in the sector from which samples are selected. The modality of this selection is reported in the section on research Methodology.

A critical limiting factor for this study was that Annual Reports and Financial

Statements for estimated sample size included only the companies which are listed in the Nigeria Stock Exchange market (NSE) whose annual reports are statutorily published and made available to the general public. There were limited or no information about companies which are not public quoted companies since they are not required statutorily to make available to the public their annual reports. Besides, even when quoted in the Stock Exchange, quite a number of companies still do not have environmental data or information reported in financial statements.

 

 

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