The relevance of environmental disclosures: are such disclosures incrementally informative?

Clarkson, Peter M., Fang, Xiaohua, Li, Yue and Richardson, Gordon (2013) The relevance of environmental disclosures: are such disclosures incrementally informative?. Journal of Accounting and Public Policy, 32 5: 410-431. doi:10.1016/j.jaccpubpol.2013.06.008

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Author Clarkson, Peter M.
Fang, Xiaohua
Li, Yue
Richardson, Gordon
Title The relevance of environmental disclosures: are such disclosures incrementally informative?
Journal name Journal of Accounting and Public Policy   Check publisher's open access policy
ISSN 0278-4254
Publication date 2013-09
Sub-type Article (original research)
DOI 10.1016/j.jaccpubpol.2013.06.008
Open Access Status
Volume 32
Issue 5
Start page 410
End page 431
Total pages 22
Place of publication New York, NY, United States
Publisher Elsevier
Collection year 2014
Language eng
Formatted abstract
Establishing the information content of transparent voluntary environmental disclosures and the source of this information content is of fundamental importance for corporate social responsibility (CSR) practitioners. Our results indicate that: (1) incremental to information provided by current Toxics Releases Inventory (TRI) data, voluntary environmental disclosures provide valuation relevant information; (2) the various disclosure categories are similar in value relevance, implying that each category is informative of management’s current environmental strategies; (3) current TRI is positively associated with cost of capital but there is no association between voluntary environmental disclosures and cost of capital; and (4) taken together, the above results point to a signaling role for such disclosures and financial performance prediction as the means by which voluntary environmental disclosures enhance firm value. This advances the literature by pinning down the source of firm value enhancement of such disclosures. Our results suggest that a proactive environmental strategy and the signaling of such a strategy to investors can enhance a firm’s stock price, a finding which will assist CSR practitioners in convincing top management that proactive environmental strategies combined with transparent voluntary environmental disclosures are worthwhile.
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ

Document type: Journal Article
Sub-type: Article (original research)
Collections: Official 2014 Collection
UQ Business School Publications
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Citation counts: TR Web of Science Citation Count  Cited 29 times in Thomson Reuters Web of Science Article | Citations
Scopus Citation Count Cited 32 times in Scopus Article | Citations
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Created: Tue, 17 Sep 2013, 14:00:41 EST by Karen Morgan on behalf of UQ Business School