Journal of Innovations

Vol. 3, Issue 1

Climate Risk Disclosure and Financial Reporting Quality of Non-Financial Firms in Nigeria

AUTHOR(S)

ADEKANMI Aderemi Daniel, APALOWOWA Olusola Daniel, ADESUYI Temitayo Yomi, JEMISEYE-DAV Regina Ayodeji, and ADEBAYO Solomon Ola

ABSTRACT

Globally, climate risk complicates investors' ability to assess whether management's decision to withhold climate risk information reflects intentional concealment or a genuine assessment of insignificance. This study investigates the relationship between the quality of financial reporting and climate risk disclosure among Nigerian-listed non-financial companies, with a focus on Dangote Cement Plc, Obajana, Nigeria. Using a survey research methodology, data were collected from 255 employees in the Administrative and Finance departments with at least seven years of tenure (source: worker time book, April 2024). From this population, 100 employees with relevant experience and awareness of climate risk were selected via purposive sampling. The findings revealed that environmental risk disclosure (t = 4.828; p < 0.05) and risk management disclosure measures (t = 0.921; p < 0.05) positively and significantly influence financial reporting quality. The study concludes that addressing climate risk is crucial for improving the disclosure quality of financial reports and ensuring the provision of relevant, industry-specific information on climate-related risks. To enhance transparency and facilitate meaningful comparisons, the study recommends establishing governance structures and oversight mechanisms for climate risk disclosure, assigning accountability to specific members or committees, conducting regular reviews of disclosure practices, and ensuring consistency and comparability across firms and over time in light of evolving risks, regulations, and best practices.

DOI

https://doi.org/10.62470/1a258217

CITE THIS ARTICLE 

Adekanmi, A. D., Apalowowa, O. D., Adesuyi, T. Y., Jemiseye-Dav, R. A. and Adebayo, S. O. (2025). Climate Risk Disclosure and Financial Reporting Quality of Non-Financial Firms in Nigeria. Journal of Innovations, 3(1), 1-15. DOI: https://doi.org/10.62470/1a258217