Environmental Disclosure and Financial Performance of Firms in Kenya: A Stakeholder Approach

摘要

Using panel data analysis this study examined the influence of environmental disclosure in annual reports on financial performance of companies listed on the Nairobi Securities Exchange in Kenya. Environmental disclosure information was collected using quantitative content analysis for the period 2007–2015 while financial performance data was collected for the period 2008–2016, a one-year lag behind the environmental disclosure data. Control variables were firm size, industry type and leverage. Environmental disclosure was found to be statistically significantly positively related to the firms’ return on assets but not statistically significant with return on equity and Tobin’s Q. The overall results suggest that disclosing environmental activities neither improves financial performance nor deteriorates it.