The Impact of Sustainability Accounting and Reporting on Firm Value-A case of Listed Companies on Lusaka Stock Exchange

Management Journal for Advanced Research, Volume-4 Issue-1 || February 2024 || PP. 1-11

11 Pages Posted: 1 Mar 2024

See all articles by hilton Chinyonga

hilton Chinyonga

University of Zambia (UNZA)

Bupe Getrude Mwanza

University of Zambia (UNZA)

Date Written: February 5, 2024

Abstract

There is a growing interest among stakeholders on the subject of Sustainability Accounting and Reporting (SAR). Literature based on SAR has reviewed that there exists a relationship between SAR practices and firm value. However, this has not been confirmed on the listed companies at Lusaka Stock Exchange (LuSE). The aim of this research was to investigate the impact of SAR on firm value, focusing on companies listed on the LuSE. The Overall objective of this research was to drive positive change, improve company performance, and ensure that companies operate in a socially, environmentally and economically responsible manner. This objective was achieved by three specific objectives firstly by examining the SAR practices among LuSE listed companies in Zambia, secondly by analyzing the relationship between SAR and firm value and lastly by identification of the key drivers to implementing SAR practices among LuSE listed companies. In doing so, the study adopted a quantitative approach to collect and analyze data. The results revealed that the level of sustainability practices has been increasing over time. However there has been gaps with regards to smaller firms which are still struggling with financial stamina. It was also found that SAR has impacted firm value and overall firm performance. A weak correlation was observed which was also significantly tested at 5% confidence level. The findings indicate that a weak association between the dependent variable Return on Assets (ROA) and the independent variables that is environmental and social sustainability indicators with overall mean of 0.164 and SD= 0.169. Based on the model, it was revealed that environmental and social sustainability indicators played a pivotal role in firm value. These results show that corporate sustainability reporting index has positive and significant impact on firm performance for the listed companies on LuSE. The main drivers of SAR practices were firm size, media visibility and ownership structure and these have been important with regards to disclosure of sustainability reports, while corporate governance only seems to have an influence on the existence of audit or sustainability committees. Therefore, it was recommended that there is need to educate and improve SAR awareness among LUSE listed companies and beyond in order to achieve sustainable development for all stakeholders.

Note:

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Keywords: sustainability, sustainability accounting and reporting, firm value, Lusaka security exchange, environmental sustainability, social sustainability

Suggested Citation

Chinyonga, hilton and Mwanza, Bupe Getrude, The Impact of Sustainability Accounting and Reporting on Firm Value-A case of Listed Companies on Lusaka Stock Exchange (February 5, 2024). Management Journal for Advanced Research, Volume-4 Issue-1 || February 2024 || PP. 1-11, Available at SSRN: https://ssrn.com/abstract=4716835

Hilton Chinyonga (Contact Author)

University of Zambia (UNZA) ( email )

Bupe Getrude Mwanza

University of Zambia (UNZA) ( email )

Dept. of Plant Science
Box 32379, Lusaka
Lusaka, Lusaka 10101
Zambia

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