Environmental Accounting Practices of Oil Companies in Nigeria: Does Greening the Environment Matter?

Abstract

The depletion of the ozone layer of the earth’s atmosphere caused by emission of gasses through industrial activities and processes have given rise to various environmental hazards such as direct ultra-violet rays to the earth surface, global warming, pollution and loss of aquatic lives. One of the major contributors to industrial gas emissions are the oil producing companies. This study tends to explore the environmental accounting practices adopted by the oil companies in South-South Nigeria to determine if the companies have taken cognizance of the hazards caused to the environment through their business activities. The study adopted survey design. The population of the study is 73 consisting 41 accountants from the five selected oil companies and 32 Chartered Accountants from accounting firms. The study adopted purposive sampling technique. The instrument for data collection was a structured questionnaire. The instrument was face-validated by three experts. Two experts from the Department of Business education, University of Nigeria, Nsukka, and one from chartered accounting firm. The reliability of the instrument was tested using Cronbach Alpha reliability coefficient. Mean and standard deviation were used to answer the research questions, while the hypotheses were tested using t-test at 0.05 level of significance. The study found that there is no statutory demand for corporate reporting of environmental accounting of the oil companies in Nigeria. The study therefore recommended that government should through the Ministry of Environment and natural resources and accounting regulating bodies make environmental corporate disclosure a compulsory practice by oil companies in Nigeria.