EFFECT OF COMPANIES’ ETHICAL POLICIES ON THE FINANCIAL REPORTING QUALITY OF SELECTED FOOD AND BEVERAGE MANUFACTURING FIRMS IN NIGERIA

Abstract

This research examined the impact of the ethical policies of firms on the quality of financial reporting among selected food and beverage manufacturing companies in Nigeria. Utilizing an ex-post facto design, the paper provided analysis on secondary data gathered from the accounts of 10 firms listed in the Nigeria Exchange Group for the years 2015 through 2024. Panel regression models, such as fixed and random effects, were used in analysis, and the Code of Ethics was identified as an important positive determinant in the quality of financial reporting (coefficient = 0.399417, p = 0.0000). Yet, the Compliance and Legal Standards, Whistleblower Policies, and Training Programs indicated no relevance. The model accounted for about 65% variation in the quality of financial reporting (R-squared = 0.649824), reflecting the pivotal nature of ethical policies. The research concludes that ethical frameworks with high standards raise the quality of financial reporting and suggests periodic ethical training, autonomous compliance arrangements, and powerful audit committees in order to enhance the quality of financial reporting.