Economic Sustainability and Share Price Behavior of Listed Financial Service Firms in Nigeria
Ayodele Grace OLALEYE, Olusola Esther IGBEKOYI (Ph.D.), Ayo AKINYELE & Adewale Joshua ASHIMOLOWO
The study investigated the effect of economic sustainability on share price behavior. The Nigeria stock market is highly inconsistent and unable to actually compete in the global financial market as some of the companies listed falls short of sustainable practice which is one of the indices for global acceptance. Existing studies focused on analyzing economic sustainability using links among financial factors such as capital structure and profitability using traditional financial analysis. However, the study took a shift by focusing on global best practices way of operating activities to maintain long term survival. The study employed quantitative approach using longitudinal and ex-post facto research designs. Secondary data were collected from the published annual reports of the firms for a period of seven years covering 2016 to 2022. 44 non-financial firms were purposively selected as sample size. The analysis of the research model was carried out using a panel regression method. The study found that share price has improved behavioral trend since the release of GRI guidelines for achieving economic sustainability. Furthermore, economic performance, market presence and indirect economic impact made by companies are of significant relevance in the determination of share price behavior. The study concluded that firms’ ability to create value and maintain operation over a long term without compromising future needs can influence positive trend of share price among financial firms. And also, the share price of firms and the overall health of the financial market can be improved upon through firms’ economic performance and market presence.
Keywords: Direct Economic Value, global reporting initiative (GRI), indirect impact, market presence