SUSTAINABILITY AND FINANCIAL PERFORMANCE

ABSTRACT

The study examined the effect of sustainability on firm performance in Nigerian Exchange Group. Sustainability is increasingly becoming a key driver of competitive advantage. It specifically took an empirical look into the effect of ecological factors, environmental factors, community development and legal requirements in Nigerian firms. A longitudinal research design was adopted with extensive reliance on secondary data sourced from the annual reports of 40 companies quoted on the Nigerian Stock Exchange for 2018-2022. Both statistical and econometric tools were employed in the analysis using data obtained from the Nigerian Exchange Group for the period of 2018 to 2022. The Ordinary Least Square (OLS) estimate was employed in the estimation of the models The study found that Community Development (CD) had a positive and statistically significant relationship with firm performance proxied by return on asset (ROA) for the sampled period. It was also found that Environmental factor (ENVFAC) had a significant positive relationship with firm performance proxied by return on asset (ROA) in Nigeria. It was also discovered that ecological factor (ECOFAC) had an insignificant negative relationship with firm performance proxied by return on asset (ROA) in Nigeria Hence, the study recommends that corporate firms should spend reasonable amounts of their income on community development as this will in turn lead to increase in their earnings as proposed by triple bottom-line accounting.