Purpose This study aims to examine the effect of sustainability reporting on market value growth (MVG) of quoted companies in Nigeria. The corporate reporting system has evolved, and this study examined how it influences the perception of investors. Design/methodology/approach This study adopted an ex post facto research design with 167 listed firms as the population. A total of 28 quoted firms were chosen with the use of purposive sampling. Data from 2009 to 2018 were obtained from secondary sources. Content analysis was used as a tool to analyse the disclosures in sustainability reports. The model was estimated using pooled ordinary least square (multivariate regression). Company age and financial leverage were used as control variables. Findings This study found that the compliance level of the sampled firms with sustainability reporting requirements for the four dimensions are below average, and sustainability reporting does not have a significant effect on MVG with Prob. (F-stat) of 0.7212 > 0.05. Therefore, this study recommends that management should intensify efforts in ensuring maximum compliance with the sustainability reporting guideline of Global Reporting Initiative to reflect in their market value and ensure its growth. Originality/value To the best of the authors’ knowledge, this study is the original idea of the authors, although references were made to previous related study but it is a unique research work of its own. The work contained in this paper (in full and part) has not been previously submitted to any other journal for publication.
1. Introduction With the increase in globalization, there has been an enhanced discussion on cross-border flows of capital between nations around the world. Multinational firms' serves as the channel through which these funds find their way around the globe-these multinationals sources for an efficient economy with working institution and system to invest and operate. System is crucial in every human organization regardless of its objectives, structure, size, and endowment or complexity. This provides the platform for the exceptional discharge of duties, professional competencies and efficiency to perform, flourish and prosper. Economies with an efficient system, though not necessarily endowed with abundant natural resources are creative and innovative because of their efficient use and management of most intangible resources-human and quality institution supporting the human endeavour. Modern theories of globalization from the perspective of economics postulate that institutional conditions can facilitate or hinder the chance of an economy to function well and drive investors. (Acs et al., 2008, 2009, 2013). Consequently, variations in the nature and structure of host institution can be detrimental or provide an opportunity for prosperity in attracting foreign capital (Acs et al., 2008; Stenholm et al., 2013). Despite a large number of studies investigating the relationship between institutions and foreign investments, large dispersion still exists among empirical findings, especially in developing economies (Herrera-Echeverri et al., 2014). Although the literature on foreign investment pointed out a range of potential benefits to economies, these benefits include its role in facilitating technology transfer and skill (human capital) upgrading, its spillover effect on domestic investment, and improvements in institutions. However, the successful reaping of these benefits depends on the prevailing conditions of the host economy regulatory quality. These conditions include the rule of law, control of corruption and quality of policies to translate to economic prosperity. SSA is faced with enormous challenges, and these challenges make foreign capital very crucial to Africa as a continent due to the need for revenue to meet with the challenges as governments are saddled with the responsibility of
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