The Effect of Water Disclosure on Firm Value in Vietnamese Listed Companies

Abstract

This paper analyzes the impact of country disclosure on the firm value of listed companies in Viet Nam. As the sharp increase in population and urbanization has led to the depletion of water resources, the issue of water management is having an impact on the sustainable development of businesses. These days stakeholders and investors are taking this issue more and more seriously, which leads to a business disclosing country information that has a positive effect on their firm value. We use the quantitative method through instrumental variables for a sample of 170 companies listed on the Ho Chi Minh Stock Exchange and conducted from 2015-2019. The results of our study have shown that there is a positive influence of information disclosure on corporate governance. Our research aims to provide additional information for the current literature by providing further evidence for the field and suggesting solutions for governments, stakeholders and companies.

“Artificial” gender diversity and public visibility: The case of corporate water disclosure in Indonesia

“…This is also consistent with Shrader et al (1997) that women tend to be given tasks that have a less instrumental impact on the company, especially CSR. Khuong, Anh, et al (2022) and Khuong, Nguyen, et al (2022) also found that the percentage of women has a positive relationship with agency costs, which can lead to a negative impact on firm performance. The existence of agency conflicts in companies can also reduce the positive impact of gender diversity on firm performance, including on the nonfinancial performance reflected in the disclosure of water management as part of green performance.…”

“…Several studies mostly look at the extent of its influence on financial performance, both in terms of firm value and risk. Khuong, Anh, et al (2022) and Khuong, Nguyen, et al (2022) found that 170 companies listed on the Ho Chi Minh Stock Exchange responded to water management issues and had a positive impact on their company value. This also applies to companies that are included in the top 50 global market capitalization in increasing earnings per share (EPS) (Ali et al, 2022).…”

“…Disclosure of company water resources and use is one of the most important business ethics (Zeng et al, 2020), reflecting the company's water resources implementation strategy and the impact on operations and society (Khuong, Anh, et al, 2022; Khuong, Nguyen, et al, 2022; Zhou et al, 2018). This includes information on the company's water intake practices, recycling or disposal, use, policies, risks or opportunities, and other water‐related issues (Liu et al, 2021).…”

“…However, the current literature shows that corporate water disclosures still receive little academic attention. Currently, the literature related to water disclosure has focused on the association with the cost of capital (Zhou et al, 2018), the credibility of the information disclosed (Talbot & Barbat, 2020), company risk (Zeng et al, 2020), linkage with CSR (Zhang et al, 2021), financial performance (Ali et al, 2022), firm value (Khuong, Anh, et al, 2022; Khuong, Nguyen, et al, 2022), board diversity (Peng et al, 2022), stakeholder information (Gilsbach et al, 2022; Yu, 2022), and ownership structure (Wicaksono & Setiawan, 2022). In the context of Indonesia, Adhariani (2021) used content analysis to examine water reporting and disclosure requirements, their relationship with political connections and corporate culture (Bambang et al, 2020), as well as the perspective of agenda‐setting theory (Wicaksono et al, 2020).…”

Confession and greenwashing: the impact of water information disclosure on firm value

“…Weber and Saunders-Hogberg (2018) found that better water management performance in the food and beverage industry addresses corporate social responsibility and helps improve financial performance. Khuong et al (2021) used a sample of Vietnamese firms in their study to demonstrate that water disclosure has a beneficial influence on corporate value and helps companies establish their brands, reputations, and positive attitudes among stakeholders. Cheng and Feng (2023) and Yang et al (2023) separately explored the role of environmental information disclosure in the risk management of cash flow and stock price synchronicity.…”