Does environmental reporting reflect environmental performance?

2014 ◽  
Vol 26 (1/2) ◽  
pp. 134-154 ◽  
Author(s):  
Christina He ◽  
Janice Loftus
Keyword(s):  
Environmental Performance ◽  
Developed Countries ◽  
Global Reporting Initiative ◽  
Environmental Reporting ◽  
Environmental Disclosure ◽  
Content Type ◽  
Environmental Disclosures ◽  
Environmentally Sensitive ◽  
Data Constraints ◽  
Practical Implications

Purpose – The purpose of this study is to evaluate the environmental disclosure practices of firms engaged in environmentally sensitive industries by examining their association with environmental performance. Design/methodology/approach – The study tests for associations between environmental performance and the level and nature of environmental disclosures by listed Chinese firms operating in industries that have been identified by a regulator as environmentally sensitive. The level of environmental disclosure is measured using a disclosure index based on the global reporting initiative. The nature of environmental disclosure is measured as the ratio of hard to total disclosure items. Findings – Firms with more favourable environmental performance provide a higher level of environmental disclosure and include a greater proportion of hard disclosure items. However, the overall level of disclosure is lower than that observed in developed countries. Research limitations/implications – Due to data constraints, the proxy for environmental performance is based on the receipt and maintenance of environmental titles and awards and does not capture variation in the level of environmental performance of firms with no titles or awards. Practical implications – As China continues to embrace market-based economic reform, the ability to reflect sustainable choices through market transactions is of increasing importance to the preservation of economic, natural and social capital for future generations. Originality/value – The study examines the relation between environmental reporting and environmental performance by firms operating in industries that have been identified by a regulator as environmentally sensitive.

Empirical analysis on corporate environmental performance and environmental disclosure in an emerging market context

2020 ◽  
Vol 15 (6) ◽  
pp. 1061-1082 ◽  
Author(s):  
Merve Acar ◽  
Hüseyin Temiz
Keyword(s):  
Environmental Performance ◽  
Emerging Market ◽  
Positive Association ◽  
Corporate Environmental Performance ◽  
Tobit Regression ◽  
Environmental Reporting ◽  
Environmental Disclosure ◽  
Significant Positive Association ◽  
Content Type ◽  
Environmental Disclosures

PurposeThe purpose of this study is to investigate the association between environmental performance of firms and the level of voluntary environmental disclosure in emerging markets.Design/methodology/approachWe used tobit regression OLS and t-test methods to reveal the association between environmental performance and the level of voluntary environmental disclosure.FindingsWe find a significant positive association between the level of discretionary environmental disclosures and corporate environmental performance. The result is in line with the arguments of economics disclosure theory that argues environmentally good performers disclose more.Practical implicationsMany of the environmentally good firms in Turkey are also listed in the “BIST Sustainability Index,” and this situation can be the result of the relative power of external regulations. Accordingly, it can be suggested to increase the community and governmental pressures for environmental reporting but also gives importance to increase intrinsic motivations for companies to engage in disclosure practices.Originality/valueThis study shed light on relation between environmental performance and environmental disclosure in an emerging market context. Also, it is revisited that the relation between environmental performance and the level of environmental disclosure by testing two different predictions on the level of environmental disclosures.

scholarly journals From Environmental Reporting to Environmental Performance

2019 ◽  
Vol 11 (9) ◽  
pp. 2549 ◽  
Author(s):  
Michaela Bednárová ◽  
Roman Klimko ◽  
Eva Rievajová
Keyword(s):  
Environmental Performance ◽  
Global Reporting Initiative ◽  
Empirical Testing ◽  
Environmental Reporting ◽  
Environmental Disclosure ◽  
Factors Influencing ◽  
Global Companies ◽  
Main Factors ◽  
The Relationship

This paper identifies factors influencing environmental disclosure and environmental performance of the top 100 Fortune Global companies. The analysis identifies whether they follow the Global Reporting Initiative (GRI) standards to gain and maintain legitimacy with relevant stakeholders. Other factors such as sector and region are taken into account, with empirical testing of a model for the relationship between the extent of environmental disclosure (measured by the developed index based on GRI indicators), sector membership, region, and actual environmental performance. Evidence exists that the main factors related to actual environmental performance were the region and level of environmental disclosure.

scholarly journals Impact of governance structures on environmental disclosures in the Middle East and Africa

2020 ◽  
Vol 20 (4) ◽  
pp. 739-763 ◽  
Author(s):  
Erhan Kilincarslan ◽  
Mohamed H. Elmagrhi ◽  
Zezeng Li
Keyword(s):  
Corporate Governance ◽  
Middle East ◽  
Gender Diversity ◽  
Governance Structures ◽  
Environmental Disclosure ◽  
Content Type ◽  
Environmental Disclosures ◽  
The Impact ◽  
The Relationship ◽  
Practical Implications

Purpose This study aims to investigate the impact of corporate governance structures on environmental disclosure practices in the Middle East and Africa (MEA). Design/methodology/approach The research model uses a panel data set of 121 publicly listed (non-financial and non-utility) firms from 11 MEA countries over the period 2010-2017, uses alternative dependent variables and regression techniques and is applied to various sub-groups to improve robustness. Findings The empirical results strongly indicate that MEA firms with high governance disclosures tend to have better environmental disclosure practices. The board characteristics of gender diversity, size, CEO/chairperson duality and audit committee size impact positively on MEA firms’ voluntary environmental disclosures, whereas board independence has a negative influence. Research limitations/implications This study advances research on the relationship between corporate governance structures and environmental disclosure practices in MEA countries, but is limited to firms for which data are available from Bloomberg. Practical implications The results have important practical implications for MEA policymakers and regulators. The positive impact of board gender diversity on firms’ environmental disclosures, policy reforms should aim to increase female directors. MEA corporations aiming to be more environmentally friendly should recruit women to top managerial positions. Originality/value This is thought to be the first study to provide insights from the efficiency and legitimation perspectives of neo-institutional theory to explain the relationship between MEA firms’ internal governance structures and environmental disclosures.

scholarly journals Pengaruh Good Corporate Governance Dan Kinerja Lingkungan Terhadap Pengungkapan Lingkungan

2019 ◽  
Vol 1 (1) ◽  
pp. 18-34
Author(s):  
Wiwi Hawin Sari ◽  
Henri Agustin ◽  
Erly Mulyani
Keyword(s):  
Corporate Governance ◽  
Environmental Performance ◽  
Stock Exchange ◽  
Secondary Data ◽  
Audit Committees ◽  
Manufacturing Companies ◽  
Environmental Reporting ◽  
Environmental Disclosure ◽  
Good Corporate Governance ◽  
Environmental Disclosures

This research aims to provide empirically the effect of good corporate governance and environmental performance on environmental disclosures. The population in this study are manufacturing companies listed on the Indonesia Stock Exchange in 2013-2017. Environmental disclosure variables are measured by scores using the Indonesian Environmental Reporting Index (IER) which consists of 35 disclosure items. The sample in this study was determined by purposive sampling method. The type of data used is secondary data obtained from www.idx.co.id as well as company websites and other sites related to research. The analytical method used is Multiple Regression Analysis. The results of this study indicate that environmental performance has a significant positive effect on environmental disclosure, Institutional Ownership has no effect on environmental disclosure and the proportion of independent audit committees also has no effect on environmental disclosures

Is corporate disclosure of environmental performance indicators reliable or biased information? A look at the underlying drivers

2020 ◽  
Vol 18 (4) ◽  
pp. 661-686
Author(s):  
Hani Tadros ◽  
Michel Magnan ◽  
Emilio Boulianne
Keyword(s):  
Performance Indicators ◽  
Environmental Performance ◽  
Panel Data Analysis ◽  
Corporate Disclosure ◽  
Positive Information ◽  
Ongoing Debate ◽  
Content Type ◽  
Environmental Disclosures ◽  
Practical Implications ◽  
Environmental Performance Indicators

Purpose This study aims to examine the disclosure determinants of environmental performance indicators (EPIs) for a sample of US firms to understand if these disclosures are reliable or whether they are biased towards the reporting of positive information. Design/methodology/approach The study uses a panel data analysis to examine the association between firms’ EPIs disclosures and their environmental performances, and other economic and legitimacy factors. Findings The results show that firms’ disclosures are not associated with the level of environmental performance and that firms continue to provide EPI information even if they witness a decline in their environmental performance. The evidence suggests that firms’ environmental disclosures are reliable and indicative of their environmental performance. Practical implications The findings suggest that mandating EPI disclosures may increase the level of the information reported and reduce firms’ discretion over the disclosure of such information. Originality/value Reporting of EPIs is directly linked to firms’ environmental performances. By examining the association between EPI disclosures and environmental performance, the study contributes to the ongoing debate about firms’ reporting and whether it is informative to its stakeholders or whether firms use this type of information to legitimize their operations and portray it in a positive light.

How does environmental performance map into environmental disclosure?

2019 ◽  
Vol 10 (1) ◽  
pp. 62-96 ◽  
Author(s):  
Hani Tadros ◽  
Michel Magnan
Keyword(s):  
Data Analysis ◽  
Panel Data ◽  
Environmental Performance ◽  
Panel Data Analysis ◽  
Environmental Disclosure ◽  
Cross Sectional ◽  
Content Type ◽  
Period Effects ◽  
Environmental Disclosures ◽  
Sustainability Reports

Purpose Focusing on a sample of firms from environmentally sensitive industries over several years, this study aims to reexamine the association between environmental disclosure and environmental performance. Design/methodology/approach The authors use a panel data analysis to examine how the interaction between environmental performance and economic and legitimacy factors influence firms’ environmental disclosures. Findings Results suggest that environmental performance moderates the effect of economic and legitimacy incentives on firms’ propensity to provide proprietary environmental disclosure, with both sets of incentives being influential. More specifically, there appears to be a reporting bias based on the firm’s environmental performance whereas the high-performers disclose more environmental information in the three following vehicles: annual report, 10-K and sustainability reports combined. Results also show that economic and legitimacy factors influence the disclosure decisions of the low and high environmental performers differently. Practical implications Understanding the determinants of environmental disclosure for high and low environmental performers helps regulators to close the reporting gap between these firms. Social implications There is little evidence to suggest that firms with low-environmental performance attempt to use their disclosures to legitimize their environmental operations. Originality/value The study examines environmental disclosures of 78 firms over a period of 14 years in annual, 10-K and sustainability reports. The panel data analysis controls for significant cross-sectional and period effects.

Is voluntary external assurance relevant for the valuation of environmental reporting by firms in environmentally sensitive industries?

2020 ◽  
Vol 11 (1) ◽  
pp. 65-98 ◽  
Author(s):  
Ikram Radhouane ◽  
Mehdi Nekhili ◽  
Haithem Nagati ◽  
Gilles Paché
Keyword(s):  
Value Relevance ◽  
Generalized Method Of Moments ◽  
Market Value ◽  
Institutional Context ◽  
Environmental Information ◽  
Environmental Reporting ◽  
Environmental Disclosure ◽  
Content Type ◽  
Market Participants ◽  
Environmentally Sensitive

Purpose This paper aims to investigate whether providing voluntary external assurance on voluntary environmental information by firms operating in environmentally sensitive industries (ESI) is relevant in terms of market value. It also examines how various characteristics of assurance statements (i.e. level of assurance, scope of assurance and provider of assurance) affect the value-relevance of environmental disclosure by ESI firms. Design/methodology/approach To mitigate the endogeneity problem, the authors use the two-step generalized method of moments estimation approach. Findings Focusing on annual and social reports of French companies listed in the SBF120 index, results show that environmental disclosure by ESI firms and its assurance are destructive in terms of market value. Moreover, while providing a broader scope of assurance and having a professional accountant as the assurance provider enhance the value relevance of environmental reporting of the whole sample, this is unlikely to be the case for ESI firms. In particular, a higher level of environmental disclosure is financially rewarded by market participants for ESI firms that provide a higher level of assurance. Practical implications The study provides a better understanding of the circumstances under which market participants assign value to voluntary environmental information disclosed by companies operating in ESI. It also provides insights into the value added to different characteristics inherent in the quality of assurance provided with regard to environmental disclosure. Social implications The study indicates that the institutional context of the relationship between the firm and its shareholders influence the value obtained from assurance. Results provide value insights regarding cultural and legal dimensions of environmental reporting. Originality/value The study extends the prior literature on the capital market benefits of voluntary assurance practices by focusing on the French legal environment. France can be considered as a new institutional context that has been little addressed by the existing literature.

Environmental disclosures on local governments' websites: a Malaysian context

2020 ◽  
Vol 33 (6/7) ◽  
pp. 663-679
Author(s):  
Che Ku Hisam Che Ku Kassim ◽  
Suraya Ahmad ◽  
Noor Emilina Mohd Nasir ◽  
Nur Nariza Mod Arifin ◽  
Wan Mohd Nazif Wan Mohd Nori
Keyword(s):  
Local Governments ◽  
Design Methodology ◽  
Research Evidence ◽  
Developed Countries ◽  
Legitimacy Theory ◽  
Environmental Reporting ◽  
Content Type ◽  
Reporting Practices ◽  
Environmental Disclosures ◽  
Socio Economic Factors

PurposeFirst, the paper examines the extent of environmental disclosures (EDs) made by the Malaysian local governments (LGs) on their websites. Second, it examines the patterns of disclosure with the aim of investigating the underlying motive behind the EDs.Design/methodology/approachA descriptive content analysis was employed to measure the EDs. A disclosure instrument, based on the extant studies, is designed to facilitate the measurement process.FindingsThe results suggest that LGs of various levels, have taken the initiative to report EDs on their websites even in the absence of any statutory reporting regulations either by the state or federal government. Differences in the types of EDs are also apparent and consistent with the premise of legitimacy theory.Originality/valueA paucity of prior studies measuring EDs made at the LG level is observed in the literature. Research evidence focussing on the EDs reported on the websites is even more scarce. This lack of research contributes to a limited understanding on the development and challenges of the environmental reporting practices within the developing country's perspective. Moreover, generalising the findings of studies conducted in developed countries may not be possible due to a number of regulatory, political and socio-economic factors.

Does the level of assurance statement on environmental disclosure affect investor assessment?

2018 ◽  
Vol 9 (3) ◽  
pp. 336-360 ◽  
Author(s):  
Géraldine Rivière-Giordano ◽  
Sophie Giordano-Spring ◽  
Charles H. Cho
Keyword(s):  
Positive Impact ◽  
Financial Analysts ◽  
Environmental Disclosure ◽  
Content Type ◽  
Study Results ◽  
Environmental Disclosures ◽  
Investment Choices ◽  
A Company ◽  
Level 2 ◽  
Practical Implications

Purpose The purpose of this study is to examine whether different levels of assurance statements of environmental disclosures affect investment choices in the French context where environmental assurance was voluntary until 2012 and became regulated and mandatory since then. Design/methodology/approach The authors conducted an experiment during the voluntary context – which represents the vast majority of countries – on a sample of 108 financial analysts. Findings Environmental disclosure has a positive impact on investment recommendations. More surprisingly, financial analysts are less likely to give recommendations in favor of a company that displays environmental disclosure with low-level assurance than for a company with no assurance statement at all. Research limitations/implications When assurance is voluntary and there are at least two levels, this study results suggest that firms should avoid selecting the lowest level of assurance because it negatively affects investor decisions. From this perspective, firms should devote sufficient effort and resources to obtain at least Level 2 environmental disclosure assurance. Practical implications Given the recommendations made by financial analysts, the authors could expect that firms may prefer to engage in a higher level of assurance or to provide no assurance rather than minimize their financial efforts and resources to select a lower level of voluntary assurance regarding environmental disclosure. Social implications This study has implications for the voluntary assurance practices of environmental disclosure and can provide support to regulators to promote higher standards in environmental assurance. It documents the relevance to increase the level of requested assurance for environmental disclosure. Originality/value To the best of the authors’ knowledge, very few studies have examined the additional effect of assurance on environmental disclosure in investors’ decisions. The experiment is conducted with financial analysts in the context of voluntary assurance.

Environmental disclosure quality: examining the impact of the stock exchange of Malaysia’s listing requirements

2015 ◽  
Vol 11 (4) ◽  
pp. 904-922 ◽  
Author(s):  
A.H. Fatima ◽  
Norhayati Abdullah ◽  
Maliah Sulaiman
Keyword(s):  
Stock Exchange ◽  
Listed Companies ◽  
Mandatory Reporting ◽  
Annual Reports ◽  
Disclosure Quality ◽  
Environmental Reporting ◽  
Environmental Disclosure ◽  
Content Type ◽  
Environmentally Sensitive

Purpose – The purpose of this study is to investigate the environmental disclosure (ED) quality of public-listed companies (PLCs) in environmentally sensitive industries (ESI) in Malaysia in 2005 and 2009 (two years before and two years after the mandatory corporate social responsibility (CSR) requirement of Bursa Malaysia (BM)). BM (The Stock Exchange of Malaysia) has made CSR, including ED in annual reports mandatory since 2007. This study compares environmental reporting (ER) before and after the 2007 mandatory reporting requirement to determine if this command and control mechanism has had any effect on the quality of ED. Design/methodology/approach – The quality of ED was measured using a disclosure quality index adapted from various prior studies. The index consists of a total of 46 disclosure items grouped into 9 categories. Content analysis was utilized to extract data from the annual reports of 164 PLCs in ESI. Findings – Overall, the quality of ED improved in 2009 from that of 2005. More importantly, companies disclosed more quantitative environmental information in 2009 than in 2005. However, the average quality of ED was still low in 2009 compared to the overall potential score. Results provide some support for legitimacy as well as institutional theories. Research limitations/implications – The sample of the study consisted of listed companies in ESI only; the results cannot be generalized to other companies in non-environmentally sensitive sectors. Practical implications – Prior studies that used data before the mandatory CSR requirement by BM found ED in annual reports mainly declarative in nature, generally low on quality and with little quantifiable data. The results of the present study provide evidence of the positive impact of mandatory environmental reporting on ED quality. Originality/value – The use of a multi-theoretical perspective may offer a more meaningful explanation of ER behavior in Malaysia. The results of the study would provide the impetus for regulatory agencies in developing countries to perhaps consider legislating ER. The findings provide some evidence to support the influence of legitimacy and institutional factors behind improved ED of Malaysian PLCs. This outcome exhibits a positive influence on the government efforts in promoting sustainability. Finally, the study contributes to present a more up-to-date account of environmental commitment undertaken by Malaysian corporations through their environmental reporting, after the CSR mandatory listing requirement took effect in 2007.

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