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Can Environmental Information Disclosure Enhance Firm Value?—An Analysis Based on Textual Characteristics of Annual Reports

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  • Rongjiang Cai

    (School of Economics and Management, Ningbo University of Technology, Ningbo 315211, China
    School of Management, China University of Mining and Technology, Xuzhou 221116, China)

  • Tao Lv

    (School of Management, China University of Mining and Technology, Xuzhou 221116, China)

  • Cheng Wang

    (School of Management, China University of Mining and Technology, Xuzhou 221116, China)

  • Nana Liu

    (School of Economics and Management, Nanjing Institute of Technology, Nanjing 210000, China)

Abstract

This study examines the impact of environmental information disclosure quality on firm value for Chinese listed companies in heavily polluting industries from 2010 to 2021. By controlling for the level of leverage, growth, and corporate governance, a fixed effects model is constructed to test this relationship. Furthermore, this study analyzes the moderating effects of annual report text features, such as length, similarity, and readability, on the relationship between environmental information disclosure and firm value and the heterogeneous impact of firm ownership on this relationship. The main findings of this study are as follows: There is a positive correlation between the level of environmental information disclosure and firm value for Chinese listed companies in heavily polluting industries. Annual report text length and readability positively moderate the relationship between environmental information disclosure and firm value. Annual report text similarity negatively moderates the relationship between environmental information disclosure and firm value performance. Compared with state-owned enterprises, the impact of environmental information disclosure quality on the firm value of no-state-owned enterprises is more significant.

Suggested Citation

  • Rongjiang Cai & Tao Lv & Cheng Wang & Nana Liu, 2023. "Can Environmental Information Disclosure Enhance Firm Value?—An Analysis Based on Textual Characteristics of Annual Reports," IJERPH, MDPI, vol. 20(5), pages 1-21, February.
    • Handle: RePEc:gam:jijerp:v:20:y:2023:i:5:p:4229-:d:1081937
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    References listed on IDEAS

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