Integrated Reporting and Financial Performance of Selected Manufacturing Firms in Nigeria: An Empirical Analysis of the Moderating Effect of Corporate Governance
Abstract
As business landscape continues to grapple globally with the challenges of accountability, transparency, and sustainability the need for a more detailed and integrated reporting approach to financial reporting has never been more tenacious. This study hereby examines the relationship between IR and financial performance, and also consider the moderating role of corporate governance in this relationship. This study adopted quantitative research design, and a sample of five (5) listed companies were selected based on their commitment to IR. Secondary data were collected from the annual reports of the companies, and from the Nigerian Stock Group. The data was analyzed using descriptive statistics, correlation and hierarchical multiple regression. The results of the study show that IR is significantly positively related to financial performance, measured by return on assets (ROA). This finding supports the notion that IR is associated with improved financial performance. The study reveals that corporate governance moderates the relationship between IR and financial performance, such that the relationship is stronger for companies with stronger corporate governance practice. Findings from this study has practical implications for businesses, investors, and regulators. For businesses, the findings suggest that adopting IR practices can lead to improved financial performance. For investors, the findings suggest that IR can be used as a tool to evaluate organisation's financial performance and potential for long-term sustainability. Finally, IR practices to regulators, can promote formulation of policy for stability in the capital market.
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