Sustainability Reporting and Dividend Policy of Listed Consumer Goods Manufacturing Companies in Nigeria
Author
Oyedare, Janet Omonike; Akinruwa, Temitope Emmanuel
Abstract
This study examined the empirical effect of corporate sustainability reporting on the dividend policy of listed consumer goods manufacturing companies in Nigeria. Anchored in Legitimacy Theory, the study adopted an ex-post facto longitudinal panel design analyzing 13 purposively selected firms on the Nigerian Exchange Group (NGX) across an 11-year period (2015–2025), yielding 143 firm-year observations. The Environmental Sustainability Reporting Index (ESRI), Social Sustainability Reporting Index (SSRI), and Governance Sustainability Reporting Index (GSRI) served as independent variables measuring sustainability reporting, while the Dividend Payout Ratio (DPR) represented dividend policy. Multiple regression analysis revealed that ESRI exerted a statistically significant negative effect on DPR (β = -1.1245, p = 0.008), indicating that capital-intensive environmental compliance outlays create liquidity pressures that compete with dividend distributions. Conversely, SSRI had a positive but insignificant effect (β = 0.8421, p = 0.103), and GSRI displayed an insignificant negative effect (β = -0.2114, p = 0.667). The joint estimation test confirmed that combined ESG dimensions significantly influenced DPR (F = 4.18, p = 0.0074), explaining 13.45% of variance in payouts. The study concluded that sustainability reporting drives payout policy under Pecking Order dynamics and recommended establishing green capital reserves to smooth future dividends.
Keywords
Corporate sustainability reporting, Dividend payout ratio, ESG compliance, Environmental reporting, Nigerian Exchange Group, Dividend policy.
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References
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