THE IMPACT OF ENVIRONMENTAL COSTS ON THE FINANCIAL PERFORMANCE OF INDUSTRIAL COMPANIES IN IRAQ

. This research investigates the impact of environmental cost on the financial performance of industrial companies in Iraq. The time-series data was collected from 25 companies chosen from the annual financial report and economic review of the Iraqi stock exchange (ISX) and oil sector for the period of 2014 to 2018. The statistical tool used for data analysis is the special package for social sciences SEM- AMOS and SPSS version 23. The statistical analysis results indicate that Conventional Cost has a positive and weak correlation with Financial Performance r=0.188, sig. 0.05; likewise, no correlation was found between Image and Relationship Costs and Financial Performance r=-0.137, sig.>0.05. The managements of industrial companies are urged to establish efficient environmental costing systems so as to ensure a corporate environment that is free of conflict which would ultimately lead to better corporate financial performance. The findings of this study contribute to the existing body of knowledge concerning the effect of environmental costs on the financial performance of industrial firms particularly those in the oil sector and listed on the Iraqi Stock Exchange, as most Iraqi studies had neglected to examine the impact of environmental costs on the financial performance of companies in these sectors