Effect of Environmental Accounting on Financial Performance of Quoted Oil and Gas Companies in Nigeria

Globalization has helped connect societies and their environmental fates more closely than ever before. Individuals are now stressing the importance of the natural environment. Environmentally responsible activities from operating companies to the host communities reduce hostility and disruption of operations. Therefore, this study examines the relationship between environmental accounting and financial performance of selected oil and gas companies listed on Nigerian Stock Exchange. Using simple random sampling technique, secondary data were collected from annual reports and accounts of eight (8) selected oil and gas companies spanning 2009 to 2018.Multiple regression technique was adapted to analyse data collected. The findings reveals that environmental accounting does not have significant impact on the financial performance of the listed oil and gas firms in Nigeria for the period covered as indicated by Wald X2 (4.33)and (7.60) with P-value 0.3629 and 0.1075respectively for ROE and ROA. These means that the fund committed to environmental cost by these selected firms does not reflect on their profitability for the period under reviewed. Based on this, it was recommended that Management of oil and gas firms should increase their participation in Community Development Cost (CDC) to their host communities and increase their employee health and safety cost (EHSC)in order to guarantee a conflict free operation atmosphere needed by managers, customers, employees and interested parties for maximum productivity. The government should make law that will mandate oil and gas firms in Nigeria to deploy certain percentage of their income back to the host community to enhance more participation in environmental accounting and improve organization performance.