Carbon Disclosure, Financial Transparency, and Agency Cost: Evidence from Chinese Manufacturing Listed Companies

Zhou, Zhifang; Zhou, Hong; Peng, Dongliang; Chen, Xiaohong; Li, Shihui

doi:10.1080/1540496x.2018.1428796

Cited by 32 publications

(21 citation statements)

References 39 publications

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“…According to agency theory, effective internal control indicates a strong internal environment with reliable environmental reporting [39][40][41]. The internal control regulations state that the objective of internal control is to ensure the reliability of financial reporting, improve the effectiveness of business operations, and comply with laws and regulations [42].…”

Section: Internal Control and Quality Of Carbon Emission Disclosuresmentioning

confidence: 99%

Impact of Carbon Emission Trading System Participation and Level of Internal Control on Quality of Carbon Emission Disclosures: Insights from Chinese State-Owned Electricity Companies

et al. 2020

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In recent years, the quality of carbon emission disclosures has become a central area of concern for different stakeholders of companies. Specifically, stakeholders of state-owned enterprises (SOEs) want these companies to legitimize their actions regarding carbon emissions reductions reporting. The current study aims to explore the impact of carbon emission trading system participation and the level of internal control on the quality of carbon emission disclosures. Using a sample of Chinese state-owned electricity companies from 2012 to 2018 and employing the difference-in-differences (DID) method, we find a positive impact of the carbon emission trading system participation on the quality of carbon emission disclosures, which suggests that the state-owned electricity companies' participation in the carbon emission trading system leads to the higher quality of carbon emission disclosures. Likewise, we find a positive relationship between the level of internal control and the quality of carbon emission disclosures, which suggests that the state-owned electricity companies with stronger internal control provide the higher quality of carbon emission disclosures. In addition, we find that the findings are only significant in the case of central SOEs as compared to local SOEs. Our findings contribute to the practical, policy, and research implications as the quality of carbon disclosures is the primary concern from a variety of stakeholders.

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Section: Internal Control and Quality Of Carbon Emission Disclosuresmentioning

confidence: 99%

Impact of Carbon Emission Trading System Participation and Level of Internal Control on Quality of Carbon Emission Disclosures: Insights from Chinese State-Owned Electricity Companies

et al. 2020

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“…According to prior studies (Zhou et al, b; Zeng, Zhang, Zhou, Zhao, & Chen, ), the criteria for continuous screening processes includes the following steps. (a) Subtract the companies with at least 1 year of reports missing between 2012 and 2016, because employing panel data from multiple data sources include time series information and avoid the common method variance problem that usually exists in survey data.…”

Section: Methodsmentioning

confidence: 99%

“…Foreign (non‐Chinese) scholars tend to use the KLD or CDP databases for research (Delmas, Etzion, & Nairn‐Birch, ; Tauringana & Chithambo, ). Therefore, drawing on the practices of Boettcher and Mueller (), Haque (), Zhou et al (b), and Dobler, Lajili, and Zéghal (), we used the Carbon Risk Management Index based on the CDP, Climate Change Questionnaire to measure carbon risk management. We considered a total of 12 items to manage the carbon risk before the event, during the event and after the event, and the scale is shown in Table .…”

Section: Methodsmentioning

confidence: 99%

“…Administrative hierarchical distance indicates the level of the government that has an direct impact on the company, which reflects the level of supervision and control over the established company that the government may hold (Wang et al, ). This paper does not use the inherent paradigm of corporate property rights as a moderating variable (Zhou et al, b) but subdivides the case study listed companies into five types according to the ultimate controller data of the company according to the “ultimate property rights theory” and uses the values 1 to 5 to calculate the distance (Li, Xia, & Zajac, ; Wang et al, ). If the company is controlled by the central government, the value is 5; if the company is controlled by the provincial government, the value is 4; if the company is controlled by the municipal government, the value is 3; if the company is controlled by the county government, the value is 2; if the company is not controlled by any level of government, the value is 1.…”

Section: Methodsmentioning

confidence: 99%

“…Carbon risk causes great uncertainty in the process of enterprise development, and this uncertainty will become increasingly prominent as climate problems intensify (Zhou et al, b). Therefore, carbon risk management, as an effective strategy for promoting CSR and enhancing competitive advantages, is an important manifestation of how enterprises have been responding to the low‐carbon era.…”

Section: Literature Review and Research Hypothesesmentioning

confidence: 99%

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Carbon risk management and corporate competitive advantages: “Differential promotion” or “cost hindrance”?

et al. 2020

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Given the strengthening of carbon regulations and the launch of emission trading scheme in China, companies are facing tremendous pressure to reduce carbon emissions, suggesting the necessity of understanding whether carbon risk management may affect corporate financial benefits. Therefore, this paper empirically demonstrates the influence of carbon risk management on corporate competitive advantages. We find that the relationship between carbon risk management and corporate competitive advantages is a "kuznets curve" that exists only among firms with weak product competition. And this relationship tends to be weakened in firms with a distant administrative hierarchy. We conclude that the influence of low carbon management on corporate competitive advantages is complicated and subject to the firm's political relevance. K E Y W O R D S administrative hierarchical distance, carbon risk management, competitive advantages, resource-based view, sustainable development

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Business strategy and environmental information disclosure from a Confucian cultural perspective: Evidence from China

Zhao,

Wang,

Zhang

et al. 2023

Bus Strat Env

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Based on social contract theory, this study investigates the impact of business strategy on environmental information disclosure from an informal institutional perspective. Using empirical data from a panel of Chinese listed A‐share firms in Shanghai and Shenzhen from 2010 to 2020, we demonstrate that firms following prospector strategies have higher levels of environmental information disclosure compared to those following defender strategies. Our findings also reveal that Confucian culture positively moderates the relationship between business strategy and environmental information disclosure. Specifically, we find that when environmental uncertainty increases, the moderating effect of Confucian culture weakens, while effective legal supervision strengthens the positive moderating effect of Confucian culture. Additionally, our results show that business strategy affects environmental information disclosure through the dual channels of economic benefits contract and social recognition contract. Overall, this research provides valuable insights for corporate sustainable development and effective government environmental governance.

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Carbon Disclosure, Financial Transparency, and Agency Cost: Evidence from Chinese Manufacturing Listed Companies

Cited by 32 publications

References 39 publications

Impact of Carbon Emission Trading System Participation and Level of Internal Control on Quality of Carbon Emission Disclosures: Insights from Chinese State-Owned Electricity Companies

Impact of Carbon Emission Trading System Participation and Level of Internal Control on Quality of Carbon Emission Disclosures: Insights from Chinese State-Owned Electricity Companies

Carbon risk management and corporate competitive advantages: “Differential promotion” or “cost hindrance”?

Business strategy and environmental information disclosure from a Confucian cultural perspective: Evidence from China

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