ESG Disclosure and Value of Listed Industrial Goods Firms in Nigeria: The Moderating Effect of Board Gender Diversity

Abstract

In recent times, rising pressure from stakeholders, greater regulatory oversight, and increased investor interest in sustainable business practices have amplified the significance of Environmental, Social, and Governance (ESG) disclosure as a means to boost firm value. Despite the increasing focus, empirical findings on the impact of ESG disclosure on enhancing firm value are inconsistent, especially in emerging markets like Nigeria, where corporate governance frameworks and sustainability reporting practices are still developing. Moreover, limited attention has been paid to the role of board attributes, especially board gender diversity in strengthening the value relevance of ESG disclosures. Against this backdrop, this study examined the moderating effect of board gender diversity on the relationship between ESG disclosure and the value of listed industrial goods firms in Nigeria. The population of the study consists of thirteen (13) listed industrial goods firms on the Nigerian Exchange (NGX) group as at 31st December, 2024. The study employed a non-survey research design, using a sample size of eleven (11) firms from a total population of thirteen (13) listed industrial goods firms on the NGX group, with data extracted from the annual reports and accounts of the sampled companies for a period of twelve years (2013–2024). Data was analysed using descriptive statistics to provide a summary for the variables, and correlation analysis was carried out using the Pearson correlation technique. The study found that environmental and social disclosure influence value positively, while and governance disclosure has insignificant effect on the value of sampled firms. Also, BGD has a positive and significant impact on firm value. Furthermore, BGD moderates the relationship between ESG disclosure and the value of the sampled firm. On the moderating effect of board gender diversity on the relationship between ESG and firm value, it was found that R² increased from 29% to 41%. This suggests that the model now explains 14% more of the variability in the data due to the introduction of a moderator, which is the board gender diversity. Hence, board gender diversity moderates the relationship between ESG disclosure and firm value positively; it changed the direction of the relationship from negative to positive in the case of social disclosure. Consequently, the study recommends that the management of the sampled listed industrial goods firms in Nigeria should promote and sustain greater board gender diversity by ensuring adequate representation of women on corporate boards, as this enhances transparency, accountability, and overall firm value. Female directors often bring unique perspectives, ethical sensitivity, and stakeholder-oriented approaches that strengthen the quality of ESG disclosures and improve corporate reputation.