The Moderating Effect of Corporate Governance Quality on the Relationship Between Green Accounting Costs and Financial Performance: Evidence from Listed Manufacturing Companies in Nigeria

Abstract

This study examines the moderating role of corporate governance quality in the relationship between green accounting costs comprising safety-related costs, environmental protection costs, and pollution control costs and financial performance, measured by Economic Value Added (EVA), in 20 listed Nigerian manufacturing firms from 2014 to 2023 (200 firm-year observations). Using random effects panel regression with robust standard errors, results reveal that environmental protection and pollution control costs exert significant positive direct effects on EVA, while safety related costs show a positive but insignificant direct impact. Corporate governance quality significantly and positively moderates all three relationships, amplifying EVA gains most notably transforming the latent benefits of safety-related costs into measurable value. Anchored in stakeholder theory, these findings highlight governance as a critical enabler for sustainability driven performance in emerging markets, where institutional challenges persist. Implications for policy and practice emphasize integrated reporting and ESG-focused governance to unlock green investments' full potential.