Impact of Environmental, Social and Governance Disclosure on Financial Performance of African Listed Companies

Abstract

The study examined the impacts of social, environmental and governance disclosure on financial performance of African listed firms. The study was anchored on the resource-based view theory. The quantitative design was employed utilising panel data for the period from 2020 to 2024. Data was obtained from a sample of 13 firms drawn from S&P Africa 40 firms. Data was obtained from published audited financial statements of the selected firms and S&P Global database. Panel regression was employed where the random effects model was found the most suitable estimator. The results showed significant positive effects of ESG disclosure and environmental disclosure on financial performance.  Governance disclosure, firm size and leverage were found statistically insignificant. The study recommended for mandatory ESG disclosure by governmental and regulatory authorities and increased investments in sustainability reporting by the firms.