Empirical examination of sustainability reporting, return on capital employed and gross profit margin
Rachael Okwudili Iliemena 1 * , Michael Jimoh Adinoyi Amedu 2 , Rosemary Edememen Uagbale-Ekatah 3
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1 Department of Accountancy, Faculty of Management Sciences, Nnamdi Azikiwe University, Awka, Anambra State, NIGERIA2 Department of Accountancy, School of Studies, Edo State Polytechnic, Usen, Edo State, NIGERIA3 Department of Accounting, Faculty of Social and Management Sciences, Benson Idahosa University, Benin City, Edo State, NIGERIA* Corresponding Author


This study examined the effect of social and environmental disclosure respectively on gross profit margin (GPM) and return on capital employed (ROCE) of manufacturing firms in Nigeria. This was prompted by the dearth of literature on sustainability reporting (SR) and the inexistence of Nigerian based SR standards and guidelines. The study adopted ex-post facto research design while data were gathered from annual reports and sustainability reports of the 23 sampled companies from the period 2012 to 2021, which represents the International Financial Reporting Standards reporting period in Nigeria as at the time of the study. Finding from the regression analysis showed there is significant positive effect of social disclosure on GPM. However, no significant effect of environmental disclosure was observed on ROCE, which could have been due to other factors outside our scope of study. It is therefore recommended among others that business organizations incorporate SR as part of their reporting policy to reap the associated benefit on GPM with high hopes that other things being equal, constant increase in GPM will influence the ROCE to increase significantly at a point. As policy recommendation, government should put in place annual awards and recognition programs for firms with near or 100% disclosure to encourage a more sustainability-driven economy towards the achievement of the sustainable development goals agenda.


This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Article Type: Research Article

EUR J SUSTAIN DEV RES, 2023, Volume 7, Issue 1, Article No: em0204


Publication date: 01 Jan 2023

Online publication date: 15 Oct 2022

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