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Does Hazy Weather Influence Earnings Management of Heavy-Polluting Enterprises? A Chinese Empirical Study from the Perspective of Negative Social Concerns

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  • Xiaodong Zhu

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Rongrong Gu

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Bingbing Wu

    (School of Management Science and Engineering, Nanjing University of Information Science & Technology, Nanjing 210044, China)

  • Shunsuke Managi

    (Department of Urban and Environmental Engineering, Faculty of Engineering, Kyushu University, 744, Motooka Nishi-ku, Fukuoka 819-0395, Japan)

Abstract

During the 2014 APEC Conference, there was a long presence of blue sky (APEC Blue) after a long-time occurrence of hazy weather in Beijing, China, which prompted the public’s attention to heavy-polluting enterprises to reach a new peak. Will the public’s negative concern about the incident will affect the operation of heavy-polluting enterprises? In this paper, we analyzed the influence of the haze-related exogenous events before and after the “APEC Blue” on earnings management of heavy-polluting enterprises from a new perspective of negative social attention. We carry out research from three perspectives for further research, which involve the growth in the demand for accounting information disclosure, the increase of consumers’ low-carbon consciousness and differences in the amount of attention on enterprises with different properties and scales. Results indicate that heavy-polluting enterprises have stronger preference for downward earnings management, especially in those enterprises that are large in scale, non-state owned, or have a direct relationship with consumers.

Suggested Citation

  • Xiaodong Zhu & Rongrong Gu & Bingbing Wu & Shunsuke Managi, 2017. "Does Hazy Weather Influence Earnings Management of Heavy-Polluting Enterprises? A Chinese Empirical Study from the Perspective of Negative Social Concerns," Sustainability, MDPI, vol. 9(12), pages 1-15, December.
    • Handle: RePEc:gam:jsusta:v:9:y:2017:i:12:p:2296-:d:122487
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    Cited by:

    1. Xiaobing Yu & Xianrui Yu & Yiqun Lu & Jichuan Sheng, 2018. "Economic and Emission Dispatch Using Ensemble Multi-Objective Differential Evolution Algorithm," Sustainability, MDPI, vol. 10(2), pages 1-17, February.
    2. Liu, Xinghe & Wang, Enxian & Cai, Danting, 2019. "Green credit policy, property rights and debt financing: Quasi-natural experimental evidence from China," Finance Research Letters, Elsevier, vol. 29(C), pages 129-135.
    3. Yongrok Choi, 2018. "Regional Cooperation for the Sustainable Development and Management in Northeast Asia," Sustainability, MDPI, vol. 10(2), pages 1-8, February.
    4. Lin, Boqiang & Xie, Jiawen, 2023. "Superior administration’s environmental inspections and local polluters’ rent seeking: A perspective of multilevel principal–agent relationships," Economic Analysis and Policy, Elsevier, vol. 80(C), pages 805-819.

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