The Impact of Artificial Intelligence on Sustainability Accounting Practices in Nigeria's Manufacturing Sector: A stakeholder perspective.

Artificial Intelligence on Sustainability Accounting Practices

Abstract

Sustainability accounting has grown in importance and influence, helping corporations tackle germane operational issues relating to the environmental and social impacts of their productive activities. The execution of sustainability accounting as a performance management system can be complicated, thus cutting-edge methods like artificial intelligence (AI) are being explored to improve its ease pf use. While AI is being used in more financial reporting workloads in reporting entities, its impact on sustainability accounting has not been properly investigated, especially in developing countries like Nigeria. This study addresses this gap by examining the impact of AI in Nigerian manufacturing companies, analysing stakeholders' views on AI's impact on sustainability accounting. A cross-sectional study was conducted on ninety-one (91) finance professionals (managers and individual contributors). The study's hypothesis was: the proportion of stakeholders that perceive that AI improves sustainability accounting practices is less than or equal to 50% (α = 0.05).  A one-sample z-test of proportions was conducted to validate the study’s hypothesis and data analysis (p < 0.05) revealed that a significant proportion of respondents agree that sustainability accounting can be improved by artificial intelligence in Nigeria. The study also revealed that the primary workloads for which AI was utilized in sustainability accounting in Nigeria were: advanced analytics and natural language processing However, the study acknowledges certain limitations, notable of which is the small sample size and its focus on manufacturing industries. The study concludes that AI is very effective in sustainability accounting, hence its adoption in Nigerian reporting entities is encouraged. This study is the first attempt by any study to assess the mechanisms through which AI impacts sustainability accounting in Nigeria, and its findings have implications for both academics and practitioners, highlighting the potential benefits of adopting AI in sustainability accounting practices to enhance the accuracy and efficiency of reporting.