Sustainability Reporting and Financial Performance of Upstream Oil and Gas Companies in South - South of Nigeria

The Nigerian economy heavily relies on oil and gas revenue, which significantly contributes to its 
development. However, competition for financial performance among oil and gas companies has 
raised concerns among residents in the South-South region. This study examines the impact of 
sustainability reporting on the financial performance of six upstream oil and gas companies in 
South-South Nigeria, using an ex-post facto design. A total of 54 observations were drawn from 
nine years (2015–2023) of audited financial statements and sustainability reports sourced from 
company websites and the Nigerian Stock Exchange. Environmental, economic, and social 
reporting metrics were analyzed using content analysis based on Global Reporting Initiative (GRI) 
standards. Data validity was ensured through audited reports and diagnostic tests, including 
Variance Inflation Factor (VIF) for multicollinearity and the Breusch-Pagan test for 
heteroskedasticity. Descriptive statistics summarized data trends, while multiple regression 
analysis evaluated the relationships between sustainability reporting and financial performance, 
with results presented through tables, charts, and graphs. The study evaluates the impact of 
sustainability reporting on financial performance, revealing mixed outcomes. Environmental 
reporting positively but insignificantly affects ROA (β = 0.138, p = 0.063), while economic 
reporting has a significant negative effect (β = -0.015, p < 0.01), and social reporting shows no 
significant impact (β = -0.187, p = 0.596). For ROE, environmental (β = 0.0177, p = 0.8709), 
economic (β = 0.0314, p = 0.7596), and social (β = 0.1101, p = 0.3895) reporting display positive 
but insignificant effects. Economic reporting significantly influences ROCE (β = 0.179, p = 
0.0051), whereas environmental (β = 0.198, p = 0.113) and social reporting (β = -0.149, p = 0.303) 
remain insignificant. The models, while statistically significant, exhibit weak to moderate 
explanatory power (R²: 0.011–0.379), indicating a limited overall impact of sustainability 
reporting on financial performance. Economic reporting stands out as the most influential, 
particularly for ROCE, highlighting the importance of strategic economic disclosures. Further 
research into additional determinants of financial performance is recommended to deepen 
understanding of these relationships.