The Impact of Corporate Governance Quality on Sustainability Accounting Disclosures: Evidence from Listed Non-Financial Companies in Nigeria

Abstract

Corporate governance quality has been extensively theorised as a critical determinant of corporate disclosure behaviour, yet its direct effect on sustainability accounting disclosure among Nigerian listed non-financial firms remains empirically contested and underexplored. This study examined the effect of corporate governance quality operationalised through board composition and audit committee effectiveness on sustainability accounting disclosure among listed non-financial firms in Nigeria. Secondary panel data were drawn from the annual reports and sustainability disclosures of 74 listed non-financial firms across ten subsectors of the Nigerian Exchange Group over the period 2015 to 2024, yielding an unbalanced panel of 696 firm-year observations. The Feasible Generalised Least Squares (FGLS) estimator was employed across two model specifications. The findings revealed that board composition did not exert a statistically significant direct effect on sustainability accounting disclosure, while audit committee effectiveness exerted a negative and highly significant direct effect. These counterintuitive findings demonstrated that corporate governance quality in Nigerian listed non-financial firms operates in a compliance-driven orientation focused on financial reporting rather than sustainability transparency. Firm size and firm age were significant positive predictors, while leverage was not significant.