FACTORS AFFECTING THE ADOPTION OF ENVIRONMENTAL ACCOUNTING PRACTICE BY FIRMS LISTED AT NAIROBI SECURITIES EXCHANGE

Paul Kamau Ndung’u

Jomo Kenyatta University of Agriculture and Technology, Kenya

Dr. Willy Muturi

Jomo Kenyatta University of Agriculture and Technology, Kenya

CITATION: Ndung’u, P. K., & Muturi, W. (2018). Factors Affecting The Adoption Of Environmental Accounting Practice By Firms Listed At Nairobi Securities Exchange. International Journal of Economics and Finance. Vol. 7 (5) pp 1 – 11.

ABSTRACT

The study sought to establish the factors affecting the adoption of environmental accounting practice in corporate organization listed at Nairobi Securities Exchange. This study adopted descriptive research design and the target population of the study was 65 listed firms at Nairobi Securities Exchange from which a sample of 195 respondents was selected using purposive sampling where three employees were selected from each firm. The employees were managerial staff in top management level, middle managers and supervisory employees. The study findings indicated that most Kenyan firms were embracing environmental accounting and reporting though they did not follow any guideline when reporting. Results further indicated that management commitment, non-compulsory disclosure, sustainability focus and employee competency influenced adoption of environmental accounting practices. The study concludes that there has been improvement in adoption of environment accounting reporting practices among the listed companies. This may have been attributed to by the fact that the stakeholders are more concerned with the environment issues and are going for the companies that are going green. The study recommends that NSE could consider the standardization of environmental disclosure and to develop requirements for it. This could improve the significance given to this subject by managers and the members of the public who are investors of these companies. This would be one way to benchmark outstanding stock markets in more developed countries and would have a positive contribution to the economic growth of Kenya.

Key Words: Enviromnetal Accounting Practice, Management Commitment, Sustainability Focus, Employee Competence, Non-compulsory Disclosure

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