Creating environmental sustainability: determining factors of water resources information disclosure among Chinese enterprises

Abstract

Purpose

This paper aims to use stakeholder theory and the guanxi perspective to examine the determining factors of water resources information disclosure among Chinese enterprises in the context of authoritarian and normative pressures.

Design/methodology/approach

Content analysis is first applied to analyze the environmental sustainability reports of the sample enterprises from 2010 to 2017. Afterward, logistic regression analysis is used to analyze the coded data and examine the proposed hypotheses.

Findings

The empirical evidence shows that having the state as the largest shareholder is positively, but not significantly, related to disclosure of water resources information. Water-sensitive industries are positively and significantly related to the disclosure of water resources information. Guanxi is negatively related to disclosure of water resources information, but not to the level of significance. The effect of the interaction term (Guanxi × Large) on disclosure is negative and also significant.

Practical implications

It is necessary for enterprises to build environmental awareness, increase information transparency for better communication with stakeholders and also establish accountability mechanisms. For effective disclosure and higher information transparency, the Chinese Government should take measures to avoid the disruption of guanxi and ensure effective enforcement of laws.

Social implications

Industrial organizations or supervisory institutions are advised to encourage firms to build awareness of water-related risks and environmental sustainability and to improve how they disclose water resources information to stakeholders.

Originality/value

This study offers evidence of the determining factors of water resources information disclosure, a topic that has been rarely studied before. The evidence sheds light on how firms, especially those in China, have dealt with disclosure of water resources information in the context of authoritarian and normative pressures.

Citation

Yu, H.-C. (2022), "Creating environmental sustainability: determining factors of water resources information disclosure among Chinese enterprises", Sustainability Accounting, Management and Policy Journal, Vol. 13 No. 2, pp. 438-458. https://doi.org/10.1108/SAMPJ-11-2019-0385