Environmental, social, and governance and corporate value of listed companies in Nigeria

Purpose of the Research: This study evaluates the influence of environmental, social, and governance (ESG) disclosures on the corporate value of listed firms in Nigeria. The study analyses the disaggregated influence of environmental, social and governance practices on market-based performance metric. Design/methodology: A sample of 27 listed firms on the Nigerian Stock Exchange (NGX) cutting across several subsectors and with audited annual reports from 2018 to 2023 was selected. Results/findings: The findings demonstrated a strong negative influence of the three dimensions of ESG on the corporate value (TQ). The coefficients of each ESG dimension demonstrated a significant positive effect on the alternative measure of company value. Practical implications and conclusions: These findings may show that the impact of ESG on corporate value differs depending on the metric used to assess corporate value. Thus, while ESG disclosures may increase firm-based measures of value, they may negatively influence market-based performance. Our results are well situated in the agency, stakeholders’ and signaling theories. The R2 for each facet of the ESG is above 50%, showing that regulatory attention must be focused on effective ESG-related regulations to relieve probable future effects on firm value.