Electronic Theses and Dissertations (Masters/MBA)

Permanent URI for this collectionhttps://hdl.handle.net/10539/37942

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    Corporate Sustainability disclosures and perfomance of Top 40 JSE Listed companies
    (University of the Witwatersrand, Johannesburg, 2023) Moyane, Motleke Virginia
    Corporate sustainability reports are typically included as part of integrated annual reports, because they explain to stakeholders how the organisation creates value over time” (IIRC, 2013). Literature posits that being a good corporate citizen is smart business and relevant for companies to report on how they affected the lives of communities in which they operate (King & Lessidrenska, 2009). This study assessed whether corporate sustainability reporting (evidenced through ESG components) affects the financial performance (ROA, ROE, ROI and Tobin’s Q) of JSE Top 40 companies. The study was quantitative in nature and took on characteristics of an event study which saw the collection of panel data on the JSE Top 40 companies over the period from 2017 to 2021. The data comprised of individualised ESG scores as determined through the Bloomberg ESG scoring matrix, together with reported financial performance measures over the period. The dependant variable for this study are the financial performance measures whilst the ESG scores are independent. From a statistical perspective, the results of the study indicate mixed reactions. The results for environmental factors indicate a positive correlation to all performance measures and that the relationship to performance is statistically significant, suggesting that businesses might increase their financial performance by funding environmental initiatives. For social factors, results indicate a negative correlation to ROA, ROE and ROI whilst there is no correlation to Tobin’s Q. Social indicators typically represent human obligations and such negative correlations imply that spending on this area may not yield positive financial returns but may yield better outcomes when considered against other intrinsic measures. The relationship between governance disclosures indicates positive correlations to ROA, ROE and ROI but negative for Tobin’s Q whilst the relationship between governance and performance appears to be largely positive and significant, save for Tobin’s Q which was negative and not statistically significant, thus proving that issues of effective corporate governance have a positive effect on financial performance. It is hoped that this research will help focus organisational efforts on issues of sustainability activities by providing broad categories on which ESG factors to focus on in 7 order to yield more financial performance whilst also contributing to the body of work on corporate sustainability reporting and the effect this has on financial performan
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    The relationship between sustainability reporting and banks financial performance
    (University of the Witwatersrand, Johannesburg, 2023) Msimanga, Thokozani; Godspower-Akpomiemie, Euphemia
    Sustainability reporting, which involves environment, social, governance (ESG) is about reporting non-financial information regarding a company. It explains how the three sustainability components affect a company. ESG has gained significant popularity in the last ten years as new risk factors for investors are introduced by global sustainability concerns such as climate change, growing regulatory constraints, and social transformations. There is limited ESG-related research in South Africa, hence the aim of this study is to empirically evaluate whether sustainability reporting, improves financial performance and value for investors and other stakeholders. This has created a knowledge gap that may be investigated and used to start a discussion about the relationship sustainability has with financial performance from a South African banking perspective. This study’s data covered a 16-year period being, 2006 – 2021, across the six largest locally controlled banks listed on the JSE; Absa, Capitec, FirstRand, Investec, Nedbank, and Standard Bank. To examine for a statistical association, panel data regression analysis is used in this study.Multiple methods of estimation were considered, ultimately various diagnostic tests conducted concluded the fixed effects model as the most robust. A negative relationship with financial performance was found. Two models, Return on Equity and Tobin’s Q model showed a negative and significant relationship with the performance of banks. The Return on Assets model also indicated a negative relationship, but it was not statisticallysignificant. This indicates that an increase in sustainability reporting, leads to a decline in financialperformance from both an accounting and market perspective