Climate Vulnerability, Technological Innovation and Performance of Listed Agro-Based Firms in Selected Sub-Saharan African Countries

Abstract

The relationship between climate vulnerability and technological innovation in influencing the performance of agro-based firms in SSA has not been extensively studied. The objective of this study is to address this research gap by examining how climate vulnerability and technological innovation interact with each other to impact the performance of listed agro-based firms in selected countries in sub-Saharan Africa. Specifically, the study investigates the effect of climate vulnerability and technological innovation on firm performance as well as the moderating role of technological innovation in reducing the adverse impact of climate vulnerability on performance of agro-based firms. Return on equity is employed as an indicator for the dependent variable of financial performance. The study employs the system generalised method of moments to investigate the effect of climate vulnerability and technological innovation on performance of agro-based firms in seven SSA countries. The findings indicate that climate vulnerability has a negative effect on the performance of firms while technological innovation has a positive impact on firm performance and can effectively mitigate the adverse effect of climate vulnerability. It is therefore recommended that Government agencies in charge of environmental protection and sustainability should work closely with non-governmental organizations as well as the private sector to develop programs and policies that support the adoption of innovative technologies that can help firms mitigate the impact of climate vulnerability and improve their performance.