The purpose of this study is to investigate whether and how policy uncertainty affect corporate environmental information disclosure.
This study conducts a difference-in-difference estimation and systematically investigates the relationship between policy uncertainty and corporate environmental information disclosure. The baseline regression results are robust to a series of robustness and endogeneity tests.
The authors show that firms located in cities with stronger policy uncertainty disclose less information on environmental issues. Furthermore, this negative relationship is stronger in the Midwest and in pre-industrial regions and for stated-owned firms and firms in highly polluting industries.
This study argues that policy uncertainty reduce the corporate disclosure of environmental information. Therefore, the results provide evidence on how to better emphasize the importance of green gross domestic product in the performance appraisal system for officials.
This study confirms that corporate environmental disclosure is a response to public pressure. The results encourage the government and the public to increase corporate awareness of environmental protection.
This study contributes to the literature in the following ways. First, the authors provide a new perspective to study the relationship between policy uncertainty and corporate finance. Second, it contributes to the literature on corporate environmental information disclosure by linking policy uncertainty with firms’ disclosure of environmental information. Third, this study is a serious attempt to solve the problem of endogeneity between policy uncertainty and corporate environmental information disclosure.
Pan, Y., Chen, Q. and Zhang, P. (2020), "Does policy uncertainty affect corporate environmental information disclosure: evidence from China", Sustainability Accounting, Management and Policy Journal, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/SAMPJ-10-2018-0298Download as .RIS
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