European Journal of Accounting, Auditing and Finance Research (EJAAFR)

EA Journals

Environmental Disclosure and Price-earnings Ratio of Manufacturing Companies Listed in Nigeria


A good price-earnings ratio is a result of excellent corporate performance; nevertheless, reaching a desirable price-earnings ratio in typical Nigerian manufacturing enterprises is complex and difficult. Meeting price-earnings ratio expectation of shareholder as companies were faced with complexities and unethical non-compliances issues. Studies have suggested that effective environmental disclosure has the capacity to enhance the price-earnings ratios in manufacturing companies. This study was to examine the effect of environmental disclosure on the price-earnings ratio of listed manufacturing companies listed in Nigeria. The study employed an ex-post facto research design. The population of the study was the 66 listed manufacturing companies listed on the Nigerian Exchange Group as of 31st December 2021. Using purposive sampling technique 29 manufacturing companies were selected. Validated data, covering a period of 16 years (2006 -2021) were extracted from published financial statements of the selected manufacturing companies. The reliability of the data was premised on the statutory audit of the financial statements. Descriptive and inferential (multiple regression) statistics were used to analyze the data at a 5% significant level. The findings revealed that environmental disclosure affected the price-earnings ratio of manufacturing companies in Nigeria (Adj.R2 = 0.218, F(5, 458) = 22.87, p < 0.05) . The study recommended that the management of companies should embrace sustainable environmental disclosure to ensure an effective price-earnings ratio for manufacturing companies in Nigeria.

Keywords: Price/ earnings ratio, emission reduction, energy conservation, environmental management., environmental policies, pollution control

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