Climate Variability and Water-Related Expenditure Behaviour: Evidence from Listed Agribusiness Firms in Nigeria

This study examined the effect of climate variability on water-related expenditure behaviour among listed agribusiness firms in Nigeria. The study was motivated by increasing climatic uncertainty and limited empirical evidence regarding how climate-related pressures influence specific corporate expenditure categories. Specifically, it investigated the effects of rainfall variability and temperature variability on water-related energy expenditure, purchased water expenditure, and water treatment expenditure, while examining the moderating roles of firm size and leverage. An ex post facto research design was adopted, using panel data from 16 listed agribusiness firms in Nigeria covering the period 2015 to 2025, resulting in 176 firmyear observations. Climate data were obtained from the Nigerian Meteorological Agency (NiMet) and matched with the dominant operational locations of the sampled firms. The data were analysed using panel-data regression techniques, supported by appropriate modelselection criteria and diagnostic tests. The findings revealed that climate variability had no statistically significant effect on water-related energy expenditure, purchased water expenditure, or water treatment expenditure. However, firm size and leverage were found to moderate the relationship between climate variability and water-related expenditure, suggesting that organisational characteristics influence how climatic pressures translate into corporate financial outcomes. Based on these findings, the study recommended that listed agribusiness firms integrate rainfall and temperature variability indicators into waterinfrastructure investment, operational planning, and resource-management decisions. Firms should also strengthen the identification, classification, and monitoring of water-related expenditure to improve climate resilience and support informed managerial decisions. The study contributes to knowledge by providing firm-level empirical evidence on the relationship between climate variability and water-related expenditure within Nigeria’s agribusiness sector. Furthermore, it demonstrates the importance of examining disaggregated water-related expenditure categories in understanding corporate responses to climatic conditions. By distinguishing water-related energy, purchased water, and water treatment expenditure, the study provides a more detailed perspective on climate-related financial responses that may remain obscured when environmental expenditure is measured using aggregate indicators. Keywords: Rain-Fall Variability, Temperature Variability, Water Related Costs, Capital Expenditure Cost, Operational Expenditure Costs, Firm size and leverage, Agribusiness.