Environmental Conservation Cost and the Financial Stability of Business Organizations in a Competitive Market

Many manufacturing companies operating in Nigeria have struggled to achieve financial stability but this has become a difficult task due to complex circumstances including low capacity production, undercapitalization, lack of stakeholder legitimacy, and a complacent attitude towards the importance of environmental conservation costs. A debate in the literature has argued that adequate corporate investment towards environmental conservation and protection has been found to influence a significant level of financial stability in Nigeria. In contributing to this debate and contributing knowledge, we examined how the expenditures associated with environmental protection affected the financial stability of industrial businesses listed in Nigeria. Since secondary data for the study were taken from the yearly financial statements of the firms that were specifically chosen, it used an ex-post facto design. A total of 14 businesses were chosen from the 66 manufacturing enterprises in the population for a 16-year period beginning in 2007 and ending in 2022. For the data analysis, inferential statistics were utilised, and the external auditors' certification of the data's validity and reliability served as the basis. The study discovered that the expense of environmental protection had a considerably favourable impact on the financial stability of commercial organisations in a market that was competitive. (Adj R2=0.05,W(4,219)=23.32,p < 0.05). The study concluded that environmental conservation cost affects financial stability of business organization in a competitive market. The study recommended that Managers of manufacturing companies should prioritize investment in environmental conservation costs to enhance the financial stability of stakeholders’ value.