Anthony Ekhator OBAHIAGBON
University of Benin, Faculty of Management Sciences
Department of Finance, Benin City, PMB 1145, Edo State Nigeria
anthony.obahiagbon@uniben.edu
&
Christopher Oghionmwen IGHODARO
christopher.ighodaro@uniben.edu
Abstract
This study examined sustainable business practices and financial performance of Nigerian banks, specifically focusing on Return on Equity (ROE) as the key performance indicator. Using a dataset from 2018 to 2023, the study applied a fixed effects regression model to analyze the relationship between ESG scores and ROE. The results indicate that Environmental and Governance scores have a statistically significant positive effect on ROE, while the Social Score showed a weaker, non-significant relationship with profitability. The findings highlight the importance of strong Environmental and Governance practices in enhancing the profitability of banks in Nigeria. The study recommends that Nigerian banks focus on improving their environmental sustainability and governance structures, while continuing to
invest in social responsibility initiatives for long-term benefits.
Keywords: ESG Practices, Environmental governance, Return on Equity