Corporate Social Responsibility Disclosures and Cost of Equity Capital Evidence from Listed Interest Taking Banks in Nigeria (Published)
Disclosure of corporate social responsibility is strategic to the sustainability of any firm especially banks that have contributed to the economic development of Nigeria. When firms fail to adequately disclose their corporate social responsibility practices, providers of funds may be unaware of the risk and opportunities they are exposed to by investing in sech banks. The main objective of this study therefore was to examine the effect of corporate social responsibility disclosures on cost of equity of interest taking banks listed on the floor of the Nigerian Exchange Group from 2014-2023. The research design adopted for this study was ex post facto and secondary data were used. The population of this study consisted of 13 interest taking banks and 11 of these banks were purposively selected as the sample size. The panel regression analysis was employed in analyzing the data set and the statistical package employed was STATA version 16. The findings of this study revealed that community relations disclosures have a significant negative effect on the cost of equity capital; social donations disclosures have a positive but not statistically significant effect on the cost of equity capital while employee relations disclosures have a significant positive effect on the cost of equity capital of listed interest-taking banks in Nigeria. Based on the above findings, it was concluded that corporate social responsibility disclosures help reduce cost of equity of listed interest-taking banks in Nigeria. It was therefore recommended among others that management of these banks should be actively involved in community development and ensure transparent disclosure of these practices to stakeholders as this promote their sustainability and inclusiveness.
Keywords: CSR disclosures, community relation, cost of equity, employee relations, social donations.
The Effect of Non Financial Measures, Independent Board of Commissioners, and Audit Quality against Firm Value, With Cost of Equity as a Moderating Variable (Published)
This study aims to analyze the effect of non-financial measures, independent board of commissioners, and audit quality on firm value, with the cost of equity as a moderating variable. The method used in this research is descriptive and verification methods. The data source is secondary data from the annual reports of manufacturing companies in the 2013-2016 period which are listed on the Indonesia Stock Exchange as many as 97 companies with 388 companies. The results showed that there are non-financial measures of customer perspective and internal process perspective, independent board of commissioner, and audit quality significantly influence firm value. Cost of equity as a moderating variable makes the influence of the independent board of commissioner weak against firm value. While the growth and learning perspective variables do not really affect the firm value. Cost of equity strengthens the influence of non-financial measures customer perspective on firm value, while in the internal process perspective, growth and learning of non-financial measures and audit quality are weak. The cost of equity will strengthen variables that can support the wishes of shareholders and will weaken variables that are independent of board of commissioner and audit quality. Other results require large costs to increase firm value. Firm value can be increased by increasing non-financial activities, the number of independent board of commissioner shares and conducting audit quality by reducing the amount of cost of equity that can weaken the value of firm value.
Keywords: Audit Quality, Firm Value, Non-financial measures, cost of equity, independent board of commissioner