The Influence of Firms' Emissions Management Strategy Disclosures on Investors' Valuation Judgments

• 成果类型: Article
• 署名作者: Johnson, Joseph A.; Theis, Jochen; Vitalis, Adam; Young, Donald
• 署名单位: State University System of Florida; University of Central Florida; University of Duisburg Essen; University of Waterloo; Indiana University System; Indiana University Bloomington
• 刊物名称: CONTEMPORARY ACCOUNTING RESEARCH
• ISSN/ISSBN: 0823-9150
• DOI: 10.1111/1911-3846.12545
• 发表日期: 2020
• 页码: 642-664
• 关键词: corporate social-responsibility; nonfinancial disclosure; CLIMATE-CHANGE; INFORMATION; cost; performance; awareness; QUALITY

摘要

Recent accounting research indicates that capital markets price firms' greenhouse gas (GHG) emissions and that disclosed emissions levels are negatively associated with firms' market values. The departure point for this study is to investigate whether investors value firms differently based on the strategies firms use to mitigate GHG emissions. These strategies include making operational changes, which reduces emissions attributable to the firm, and purchasing offsets, which reduces emissions unattributable to the firm. Using an experiment, we hold constant a firm's financial performance, investment in emissions mitigation, and net emissions, and find evidence that nonprofessional investors perceive the firm to be more valuable when it primarily uses an operational change strategy versus an offsets strategy. However, consistent with theory, this result only occurs when the firm's prior sustainability performance is below the industry average and not when it is above the industry average. This difference in firm value is consistent with the notion that nonprofessional investors believe information about a firm's emissions management strategy is material. Supplemental exploratory analyses reveal that our results are mediated by investors' perception that an operational change strategy is more socially and environmentally responsible than an offsets strategy for below industry average firms. Implications for our findings on theory and practice are discussed.