Research Article
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Year 2022, , 38 - 47, 30.06.2022
https://doi.org/10.17261/Pressacademia.2022.1565

Abstract

References

  • AMPS. (2011). Community survey. In The South African all media and products survey via Eighty20. Retrieved from http://www.eighty20.co.za/databases/index.cgi
  • Afifa, M. A., Alsufy, F., & Abdallah, A. (2020). Direct and mediated associations among audit quality, earnings quality, and share price: The case of Jordan. International Journal of Economics and Business Administration, 8(3), 500–516. https://doi.org/10.35808/ijeba/540
  • Asuquo, A. I., Esther Temitayo, D., & Udonna Raphael, O. (2018). The Effect of Sustainability Reporting on Corporate Performance of Selected Quoted Brewery Firms in Nigeria. 6(3), 1–10. www.seahipaj.org
  • Bandyopadhyay, S. P., Chen, C., & Yu, Y. (2014). Mandatory audit partner rotation, audit market concentration, and audit quality: Evidence from China. Advances in Accounting, 30(1), 18–31. https://doi.org/10.1016/j.adiac.2013.12.001
  • Budiono, S., & Dura, J. (2021). The Effect Of Green Accounting Implementation On Profitability In Companies Compass Index 100. International Journal of Educational Research & Social Sciences, 1526–1534.
  • Burlea-schiopoiu, A., & Popa, I. (2013). Legitimacy theory. Encyclopedia of Corporate Social Responsibility, January 2013. https://doi.org/10.1007/978-3-642-28036-8
  • Campbell, D. (2013). ACCA technical article (Vol. 7). Technical-articles-in-students-Accountant.html
  • Chan, D. K., Li, X., & Xin, Q. (2021). Institutional investor inattention and audit quality. Journal of Accounting and Public Policy, 40(3). https://doi.org/10.1016/j.jaccpubpol.2021.106857
  • Che Ahmad, A., Osazuwa, N., & Mgbame, C. (2015). Environmental Accounting and Firm Profitability in Nigeria: Do Firm-Specific Effects Matter? IUP Journal of Accounting Research & Audit Practices, 14(1), 43.
  • Connelly, B. L., Certo, S. T., Ireland, R. D., & Reutzel, C. R. (2011). Signaling theory: A review and assessment. Journal of Management, 37(1), 39– 67. https://doi.org/10.1177/0149206310388419
  • Davidson, W. N., Xie, B., & Xu, W. (2004). Market reaction to voluntary announcements of audit committee appointments: The effect of financial expertise. Journal of Accounting and Public Policy, 23(4), 279–293. https://doi.org/10.1016/j.jaccpubpol.2004.06.001
  • Ferguson, A., Lam, P., & Ma, N. (2018). Market reactions to auditor switches under regulatory consent and market driven regimes. Journal of Contemporary Accounting and Economics, 14(2), 197–215. https://doi.org/10.1016/j.jcae.2018.05.001
  • Grossman, S. J., & Miller, M. H. (1988). Liquidity and Market Structure. The Journal of Finance, 43(3), 617–633. https://doi.org/10.1111/j.1540- 6261.1988.tb04594.x
  • Hossain, M., Mitra, S., & Rezaee, Z. (2014). Voluntary disclosure of reasons for auditor changes and the capital market reaction to information disclosure. Research in Accounting Regulation, 26(1), 40–53. https://doi.org/10.1016/j.racreg.2014.02.004
  • Hutman falih Chichan, Hussein kareem mohammed, & Tariq Tawfeeq Yousif Alabdullah. (2021). Does Environmental Management Accounting Matter in Promoting Sustainable Development? A study in Iraq. Journal of Accounting Science, 5(2), 114–126. https://doi.org/10.21070/jas.v5i2.1543
  • Jean-paul louisot, Sophie Gaultier, J. R. (2009). managing reputational risk- from theory to practice. Reputation Capital: Building and Maintaining Trust in the 21st Century, July 2009, 1–408. https://doi.org/10.1007/978-3-642-01630-1
  • Kabir, H., & Akinnusi, D. M. (2012). Corporate social and environmental accounting information reporting practices in Swaziland. Social Responsibility Journal, 8(2), 156–173. https://doi.org/10.1108/17471111211234699
  • Khalil, M., & Ozkan, A. (2016). Board Independence, Audit Quality and Earnings Management: Evidence from Egypt. Journal of Emerging Market Finance, 15(1), 84–118. https://doi.org/10.1177/0972652715623701
  • Makarenko, I., & Plastun, A. (2017). The role of accounting in sustainable development. Accounting and Financial Control, 1(2), 4–12. https://doi.org/10.21511/afc.01(2).2017.01
  • Maroun, W., & Atkins, J. (2015). The Challenges of Assuring Integrated Reports : Views from the South African Auditing Community. ACCA (Association of Chartered Certified Accountants), 1–20.
  • Maubane, P., Prinsloo, A., & Van Rooyen, N. (2014). Sustainability reporting patterns of companies listed on the Johannesburg securities exchange. Public Relations Review, 40(2), 153–160. https://doi.org/10.1016/j.pubrev.2014.02.014
  • Rachael, O. (2020). Environmental Accounting Practices and Corporate Performance: Study of Listed Oil and Gas Companies in Nigeria. European Journal of Business and Management, September. https://doi.org/10.7176/ejbm/12-22-08
  • Ramachandran, R. (2020). Theories of Stakeholder Management. SSRN Electronic Journal, January 2019. https://doi.org/10.2139/ssrn.3535087
  • Rensburg, R., & Botha, E. (2014). Is Integrated Reporting the silver bullet of financial communication? A stakeholder perspective from South Africa. Public Relations Review, 40(2), 144–152. https://doi.org/10.1016/j.pubrev.2013.11.016
  • Samy, M. (2019). The Impact of Integrated Reporting on Firm Value and Performance : Evidence from Egypt The impact of integrated reporting on firm value and performance : Evidence from Egypt Mohamed Samy El-Deeb Associate professor of accounting Faculty of Management Scie. Accounting Research Journal, 3(2), 1–33. https://scholar.archive.org/work/bd2cs6insve6zd22a4hxn5luoy/access/wayback/https://aljalexu.journals.ekb.eg/article_56831_89dec7452dbb cfaa459a32ca552d7a08.pdf
  • Şimşek, H., & Öztürk, G. (2021). Evaluation of the relationship between environmental accounting and business performance: the case of Istanbul province. Green Finance, 3(1), 46–58. https://doi.org/10.3934/gf.2021004
  • Suchman, M. C. (1995). Managing Legitimacy: Strategic and Institutional Approaches. The Academy of Management Review, 20(3), 571. https://doi.org/10.2307/258788
  • Tan OScario Archie, Frank. G. (2021). Effects of accounting tools on social and environmental accounting 1. Diponegoro Journal of Accounting, 10, 1–7.
  • Traxler, A. A., Schrack, D., & Greiling, D. (2020). Sustainability reporting and management control – A systematic exploratory literature review. Journal of Cleaner Production, 276, 122725. https://doi.org/10.1016/j.jclepro.2020.122725

MODERATING IMPACT OF THE BOARD OF DIRECTORS ON ENVIRONMENTAL ACCOUNTING AND MARKET REACTIONS IN SOUTH AFRICA

Year 2022, , 38 - 47, 30.06.2022
https://doi.org/10.17261/Pressacademia.2022.1565

Abstract

Purpose-The UN environment challenge 2030 was set to develop and enhance approaches to sustainable development. The study was carried
out to investigate the impact of environmental accounting on market reactions in Africa and more so the moderating impact of the board of
directors on the said relationship.
Methodology- The study used 119 listed firms on the Johannesburg stock exchange with the period spanning 2008-2019. We used Investment
variable regression model for the study using share price and adjusted market returns as proxy for market reactions and environment accounting
as reported in annual integrated reports as a proxy for environmental accounting
Findings- Results obtained show that environmental accounting has a positive and statistical relationship with market reactions and the board of
directors does moderate the relationship between market reactions and environmental accounting. The study shows that firms in South Africa
are taking sustainability accounting correctly by accounting for the environment. This supports the legitimacy theory and also supports the notion
that firms are taking the lead in climate change consideration. We are the first to make such a study in an African setting and thus we hope that
regulators will pay more attention to the reports and workings of firms and their contribution to the environment.
Conclusion- The study supports stakeholder and legitimacy theories as it shows that directors carry out decisions for the benefit of all stakeholders,
and firms carry out decisions to prove their legitimacy in fulfilling their societal obligations which include taking care of the environment as any
responsible citizen would. In order to achieve the UN environmental goals of 2030 of a cleaner environment, we need everyone on board including
firms, investors and the public. Investors can help push firms be more sustainable and take care of the environment in which they operate by
refusing to buy the assets of firms engaging in pollution or purchasing assets for firms that are environmentally compliant.

References

  • AMPS. (2011). Community survey. In The South African all media and products survey via Eighty20. Retrieved from http://www.eighty20.co.za/databases/index.cgi
  • Afifa, M. A., Alsufy, F., & Abdallah, A. (2020). Direct and mediated associations among audit quality, earnings quality, and share price: The case of Jordan. International Journal of Economics and Business Administration, 8(3), 500–516. https://doi.org/10.35808/ijeba/540
  • Asuquo, A. I., Esther Temitayo, D., & Udonna Raphael, O. (2018). The Effect of Sustainability Reporting on Corporate Performance of Selected Quoted Brewery Firms in Nigeria. 6(3), 1–10. www.seahipaj.org
  • Bandyopadhyay, S. P., Chen, C., & Yu, Y. (2014). Mandatory audit partner rotation, audit market concentration, and audit quality: Evidence from China. Advances in Accounting, 30(1), 18–31. https://doi.org/10.1016/j.adiac.2013.12.001
  • Budiono, S., & Dura, J. (2021). The Effect Of Green Accounting Implementation On Profitability In Companies Compass Index 100. International Journal of Educational Research & Social Sciences, 1526–1534.
  • Burlea-schiopoiu, A., & Popa, I. (2013). Legitimacy theory. Encyclopedia of Corporate Social Responsibility, January 2013. https://doi.org/10.1007/978-3-642-28036-8
  • Campbell, D. (2013). ACCA technical article (Vol. 7). Technical-articles-in-students-Accountant.html
  • Chan, D. K., Li, X., & Xin, Q. (2021). Institutional investor inattention and audit quality. Journal of Accounting and Public Policy, 40(3). https://doi.org/10.1016/j.jaccpubpol.2021.106857
  • Che Ahmad, A., Osazuwa, N., & Mgbame, C. (2015). Environmental Accounting and Firm Profitability in Nigeria: Do Firm-Specific Effects Matter? IUP Journal of Accounting Research & Audit Practices, 14(1), 43.
  • Connelly, B. L., Certo, S. T., Ireland, R. D., & Reutzel, C. R. (2011). Signaling theory: A review and assessment. Journal of Management, 37(1), 39– 67. https://doi.org/10.1177/0149206310388419
  • Davidson, W. N., Xie, B., & Xu, W. (2004). Market reaction to voluntary announcements of audit committee appointments: The effect of financial expertise. Journal of Accounting and Public Policy, 23(4), 279–293. https://doi.org/10.1016/j.jaccpubpol.2004.06.001
  • Ferguson, A., Lam, P., & Ma, N. (2018). Market reactions to auditor switches under regulatory consent and market driven regimes. Journal of Contemporary Accounting and Economics, 14(2), 197–215. https://doi.org/10.1016/j.jcae.2018.05.001
  • Grossman, S. J., & Miller, M. H. (1988). Liquidity and Market Structure. The Journal of Finance, 43(3), 617–633. https://doi.org/10.1111/j.1540- 6261.1988.tb04594.x
  • Hossain, M., Mitra, S., & Rezaee, Z. (2014). Voluntary disclosure of reasons for auditor changes and the capital market reaction to information disclosure. Research in Accounting Regulation, 26(1), 40–53. https://doi.org/10.1016/j.racreg.2014.02.004
  • Hutman falih Chichan, Hussein kareem mohammed, & Tariq Tawfeeq Yousif Alabdullah. (2021). Does Environmental Management Accounting Matter in Promoting Sustainable Development? A study in Iraq. Journal of Accounting Science, 5(2), 114–126. https://doi.org/10.21070/jas.v5i2.1543
  • Jean-paul louisot, Sophie Gaultier, J. R. (2009). managing reputational risk- from theory to practice. Reputation Capital: Building and Maintaining Trust in the 21st Century, July 2009, 1–408. https://doi.org/10.1007/978-3-642-01630-1
  • Kabir, H., & Akinnusi, D. M. (2012). Corporate social and environmental accounting information reporting practices in Swaziland. Social Responsibility Journal, 8(2), 156–173. https://doi.org/10.1108/17471111211234699
  • Khalil, M., & Ozkan, A. (2016). Board Independence, Audit Quality and Earnings Management: Evidence from Egypt. Journal of Emerging Market Finance, 15(1), 84–118. https://doi.org/10.1177/0972652715623701
  • Makarenko, I., & Plastun, A. (2017). The role of accounting in sustainable development. Accounting and Financial Control, 1(2), 4–12. https://doi.org/10.21511/afc.01(2).2017.01
  • Maroun, W., & Atkins, J. (2015). The Challenges of Assuring Integrated Reports : Views from the South African Auditing Community. ACCA (Association of Chartered Certified Accountants), 1–20.
  • Maubane, P., Prinsloo, A., & Van Rooyen, N. (2014). Sustainability reporting patterns of companies listed on the Johannesburg securities exchange. Public Relations Review, 40(2), 153–160. https://doi.org/10.1016/j.pubrev.2014.02.014
  • Rachael, O. (2020). Environmental Accounting Practices and Corporate Performance: Study of Listed Oil and Gas Companies in Nigeria. European Journal of Business and Management, September. https://doi.org/10.7176/ejbm/12-22-08
  • Ramachandran, R. (2020). Theories of Stakeholder Management. SSRN Electronic Journal, January 2019. https://doi.org/10.2139/ssrn.3535087
  • Rensburg, R., & Botha, E. (2014). Is Integrated Reporting the silver bullet of financial communication? A stakeholder perspective from South Africa. Public Relations Review, 40(2), 144–152. https://doi.org/10.1016/j.pubrev.2013.11.016
  • Samy, M. (2019). The Impact of Integrated Reporting on Firm Value and Performance : Evidence from Egypt The impact of integrated reporting on firm value and performance : Evidence from Egypt Mohamed Samy El-Deeb Associate professor of accounting Faculty of Management Scie. Accounting Research Journal, 3(2), 1–33. https://scholar.archive.org/work/bd2cs6insve6zd22a4hxn5luoy/access/wayback/https://aljalexu.journals.ekb.eg/article_56831_89dec7452dbb cfaa459a32ca552d7a08.pdf
  • Şimşek, H., & Öztürk, G. (2021). Evaluation of the relationship between environmental accounting and business performance: the case of Istanbul province. Green Finance, 3(1), 46–58. https://doi.org/10.3934/gf.2021004
  • Suchman, M. C. (1995). Managing Legitimacy: Strategic and Institutional Approaches. The Academy of Management Review, 20(3), 571. https://doi.org/10.2307/258788
  • Tan OScario Archie, Frank. G. (2021). Effects of accounting tools on social and environmental accounting 1. Diponegoro Journal of Accounting, 10, 1–7.
  • Traxler, A. A., Schrack, D., & Greiling, D. (2020). Sustainability reporting and management control – A systematic exploratory literature review. Journal of Cleaner Production, 276, 122725. https://doi.org/10.1016/j.jclepro.2020.122725
There are 29 citations in total.

Details

Primary Language English
Subjects Finance, Business Administration
Journal Section Articles
Authors

Bagonza Amon This is me 0000-0003-2525-9943

Yan Chen This is me 0000-0002-1811-8774

Frederik Rech This is me 0000-0002-6392-4951

Abdurahman Alıyı This is me 0000-0001-6239-826X

Publication Date June 30, 2022
Published in Issue Year 2022

Cite

APA Amon, B., Chen, Y., Rech, F., Alıyı, A. (2022). MODERATING IMPACT OF THE BOARD OF DIRECTORS ON ENVIRONMENTAL ACCOUNTING AND MARKET REACTIONS IN SOUTH AFRICA. Journal of Economics Finance and Accounting, 9(2), 38-47. https://doi.org/10.17261/Pressacademia.2022.1565

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