SUSTAINABILITY REPORTING AND FINANCIAL PERFORMANCE OF MULTINATIONAL OIL AND GAS FIRMS IN NIGERIA: THE PARADOX OF ENVIRONMENTAL COST.
The paper aims to examine the effect of environmental cost on the profitability of multinational oil and gas companies in Nigeria. The paper used panel data which were sourced from the annual reports and accounts of the selected quoted oil and gas companies, consisting of 6 (major multinational) Oil and Gas firms over 15 years (2004-2018). Panel regression models were employed in determining the effects of the variables under study. The findings of the study suggested that a percent (1%) increase in environmental activities resulted in 0.013 (1.3%) increase in Return on Asset (ROA). Indicating that environmental activities have a Positive and significant effect on ROA at 5% level of significance. The implication of this finding is that organizations that invest in sustainability activities would have significant competitive advantages. This is consistent with the existing of literature on sustainability reporting and financial performance. The study, therefore, recommends that since sustainability is profitable, oil and gas firms should invest more in environmental activities to enhanced growth and success. Keywords: Environmental Cost, Oil and gas, Return on Asset, Profitability, Sustainability Reporting.