The effect of ultimate ownership on the disclosure of environmental information

Publication Type

Journal Article

Publication Date

6-2018

Abstract

This study empirically examines whether environmental information disclosure (EID) is influenced by the characteristics of a firm's ultimate owners. Based on the EID of publicly listed firms in China, we qualitatively measure the quality of EID of each firm and link those quality scores to firm characteristics to understand the determinants of EID. We further link the EID scores to market valuation of the firm through the Ohlson valuation model to understand whether the market appreciates EID. Our results show that EID is more likely for government-controlled firms, firms with less hierarchy in their ultimate ownership and firms with more discrepancy between voting rights and cash flow rights. Our results also indicate that the stock market appreciates environmental issues and that EID itself, as well as disclosure quality, is associated with a higher market valuation. Our results still hold with the endogeneity issue controlled.

Discipline

Asian Studies | Business Law, Public Responsibility, and Ethics | Databases and Information Systems | Environmental Sciences | Finance and Financial Management

Research Areas

Information Systems and Management

Publication

Australian Accounting Review

Volume

28

Issue

2

First Page

186

Last Page

198

ISSN

1035-6908

Identifier

10.1111/auar.12166

Publisher

Wiley: 24 months

Copyright Owner and License

Authors

Additional URL

https://doi.org/10.1111/auar.12166

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