Driving Market Performance through Sustainability: The Role of Board Committees and Climate Change Initiatives in Nigerian Firms

Abstract

This research assessed board sustainability committee, climate change initiatives and market performance of listed firms in Nigeria. The study was anchored on resource dependency theory and adopted the panel methodology. Using a panel ordinary least square regression, the findings revealed that engagement in climate change initiatives (CCI) was negatively associated with market performance, implying that firms involved in such initiatives may experience reduced performance, likely due to increased operating costs. Interestingly, the presence of a board sustainability committee (BSC) showed a negative coefficient, although not statistically significant. This suggests that firms with dedicated sustainability committees may experience slightly lower market performance. The study recommended that Government policies should incentivize firms to adopt sustainable practices by offering tax breaks or subsidies for investments in renewable energy, waste reduction, and eco-friendly technologies. Given the potential impact of board sustainability committees on market performance, regulatory bodies such as the federal reporting council of Nigeria should mandate the establishment of such committees in listed firms.