On the Obligation to Provide Environmental Information in the 21st Century - Empirical Evidence from Germany

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu Terms of use: Documents in AbstractIn this paper, we study the e ectiveness of environmental information disclosure as a regulatory instrument. In particular we analyze its impact when environmental regulation is already advanced. Using German stock market data, we are able to identify the impact of the European Pollutant Emission Register (EPER) on the market value of listed rms using a Multivariate Regression Model (MVRM). First, we show that the publication of EPER data leads to negative abnormal returns of the respective listed rms in Germany. Second, we study drivers of these abnormal returns. Here, we nd that the rms' individual level of non-carbon emissions can explain the observed changes in market valuation, while carbon dioxide emissions do not seem to be punished by the market. Moreover, we include information on voluntarily provided environmental reports and nd that these reports can serve as a substitute to the obligatory register. JEL Classi cation: G14, L51, Q52

Effects of Information-Based Regulation on Financial Outcomes: Evidence From the European Union’s Public Emission Registry

“…Other studies examine the impact of information disclosure on stock prices (Konar and Cohen, 1997;Hamilton, 1995;Bui, 2005;Canon-de-Francia et al, 2008;Hibiki and Managi, 2010;Massier and Römer, 2012), as well as on house prices (Bui and Meyer, 2003;Mastromonaco, 2015;von Graevenitz et al, 2018). 6,7…”

“…Compared to the many studies on traditional standards and market-based policies, few studies assess the impact of information-based policies on firms. The extant literature mainly focuses on the effectiveness of these policies at reducing pollution and the financial valuation of the public disclosed information as reflected in housing and stock markets (e.g., von Graevenitz et al, 2018;Massier and Römer, 2012).…”