1 / 14

To disclose or not to disclose:

To disclose or not to disclose: What determines a firm’s decision to voluntarily report carbon information? Aoife Brophy Haney Judge Business School, University of Cambridge IAEE International Conference, Stockholm, 21 June 2011. Motivation. Problem:

lamond
Download Presentation

To disclose or not to disclose:

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. To disclose or not to disclose: What determines a firm’s decision to voluntarily report carbon information? Aoife Brophy Haney Judge Business School, University of Cambridge IAEE International Conference, Stockholm, 21 June 2011.

  2. Motivation • Problem: • Carbon reduction in large organisations • Potential solutions: • Information and reputation as regulation • Questions: • Non-financial incentives? • Voluntary vs. mandatory?

  3. Information • Information problem • Lemons (Akerlof 1970) • Price vs. quality (Tirole 1988, Stiglitz 2000) • Information disclosure • Strategic behaviour(Jin 2005) • Herding and learning (Bikhchandani 1998)

  4. Incentives to disclose • Costs of disclosure (-) • Consumers (+) • Investors (+) • Competition (?) (Grossman 1981; Jin 2005; Jovanovic 1982; Healy and Palepu 2001; Verrecchia 2001; Mathios 2000; Jin and Leslie 2003)

  5. Environmental disclosure Determinants of voluntary disclosure/participation? • Size (+) • Environmental impact (+) • Consumers (+) • Competition? (Arora and Cason 1995, 1996; Khanna and Damon 1999; Khanna and Anton 2002)

  6. Research Question • What determines a firm’s decision to voluntarily disclose (carbon) information? • In particular, how does competition affect the decision to disclose?

  7. Hypotheses H1: Consumer-facing firms are more likely to disclose carbon information voluntarily H2: Firms in more competitive industries are less likely to disclose carbon information voluntarily H3: Firms that are more dependent on capital markets are more likely to disclose carbon information

  8. Data collection • Carbon Disclosure Project (CDP) • 2007 to 2010 • Unbalanced panel • Financial databases • Bloomberg and CapitalIQ • Additional sources • Census data US and UK (industry concentration)

  9. Size effect

  10. Competition UK US

  11. Investors US UK

  12. Preliminary results Standard errors in parentheses *** p<0.01, ** p<0.05, * p<0.1

  13. Conclusions and next steps • Competition • Different measures • Dynamics – diffusion of practices • Investors • Demand for information • Response of stock market? • Regulation • Voluntary and mandatory

  14. Thank you! Questions and suggestions? Email: ab748@cam.ac.uk

More Related