Cultural Origin, Green Reporting and Firm Performance of Listed Manufacturing Firms in Sub-Saharan Africa

Abstract

This thesis has four empirical papers. The first two papers examine the impact of CEO and holding company cultural origins, respectively, on green reporting of listed manufacturing firms in Sub-Sahara Africa. The third and fourth papers analyze the role of cultural origins of CEOs and holding companies in the relationship between green reporting and firm performance of listed manufacturing firms in Sub-Sahara Africa. The period of the study spans from 2015 to 2021 and the study includes a total of 115 listed manufacturing firms, selected from 8 Anglophone countries in sub-Saharan Africa. The study employs fixed-effect panel quantile regression to achieve objectives 1&2. However, to analyze the green reporting-firm performance nexus, the study employs the Instrumental Variable-Generalized Method of Moments (IV-GMM) technique to address potential endogeneity issues. The results show that CEOs from power distance and uncertainty avoidance cultural origin have a negative impact on green reporting at the higher quantiles. In contrast, those from masculine, individualistic, and indulgent cultural backgrounds show a positive relationship. In addition, holding companies from power distance, indulgence, and uncertainty avoidance cultures exhibit a positive association with green reporting of their subsidiary companies at the higher quantiles. However, those with individualistic and Long-term orientation cultural backgrounds show a negative relationship. Furthermore, the results show that green reporting positively affects ROA and ROE. In the same vein, the relationship between green reporting and firm performance is influenced by the cultural traits of the CEO and holding company, with differing effects across different cultural dimensions. The study therefore implies that CEO and Holding company cultural origins induce green reporting in SSA. The results also imply that in SSA, manufacturing firms' green reporting induces firm performance, but its impacts vary across cultural origins. The study therefore recommends that cultural origin should be taken into consideration during CEO appointments because it influences the CEO‘s corporate decisions and affects overall firm performance. The results also highlight the need for regulators to consider the importance of the cultural disposition of people when seeking to develop a single global standard for ESGD.