Incentives for Corporate Environmental Information Disclosure in China: Public Media Pressure, Local Government Supervision and Interactive Effects

Jia Xue,Youshi He,Ming Liu,Hanyang Xu,Yin Tang

doi:10.3390/su131810016

Abstract

Disclosing environmental information is essential for listed firms to demonstrate social conscience. To fulfill government and public media supervision, Chinese listed firms are increasing the quality and quantity of disclosed environmental information. This elicits a new topic of interest: the correlation between media/government supervision and corporate environmental information disclosure (EID). The paper addresses this issue through data analysis and factor correlation study in data from some high-pollution firms in China during 2017–2019. The study first introduces a standardized definition for the quantification of media and government supervision, as well as the degree to which the corporation discloses the environmental information. Then, the correlations between the factors are isolated and refined to three sub-topics: (1) how public media and local government supervision affect the quality of corporate EID; (2) how is the interactive effect of public media and government supervision related to corporate EID; (3) how is the distinct ownership of corporate affect the government supervision on corporate EID. The concluding result from the above factor analysis could provide guidance for authorities to adjust certain laws and regulations so that the media and government supervision better motivates the corporate EID, and furthermore, better sustainable development of ecological environment.

Highlights

In the era of open information, the government’s awareness of effective public media dissemination increases [1]
This study aims to evaluate the interactive effect of public medium pressure and government supervision on corporate environmental information disclosure (EID) and the function of property ownership
This research uses the media amount and the Janis-Fadner coefficient as the measure of public media pressure, and the pollution information transparency index (PITI) index provided by the Institute of Public and Environmental Affairs (IPE) and the National Research and Development Council (NRDC) as a measure of the degree of government supervision

Summary

Introduction

In the era of open information, the government’s awareness of effective public media dissemination increases [1]. With the development of online media platforms for information disclosure [2], corporate environmental performance has been interactively regulated and supervised by local government and public media in China. In 2015, the Chinese Environmental Protection Agency promulgated the Environmental Information Disclosure Act, which further specifies the timeliness and accuracy of corporate environmental information disclosure [3,4]. Chinese enterprises have great autonomy in the manner, content and quantity of environmental information disclosure [7]. Despite all the efforts and progresses made in regulation of corporate environmental information, there is still a lack of a complete environmental information supervision system in China

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Discussion

Conclusion