Promote or Crowd Out? The Impact of Environmental Information Disclosure Methods on Enterprise Value

Abstract

Environmental information disclosure is a concrete practice for enterprises to actively implement the concept of green and sustainable development, which has great significance for enterprises to gain long-term competitive advantages. The academic world has widely discussed the relationship between environmental information disclosure and the economic performance of enterprises, but how the heterogeneity of environmental information disclosure methods affects the enterprise value has not been explored. This paper aims to answer two questions: (1) what is the impact of Ecomark and ESG on enterprise value? and (2) how does the interaction between Ecomark and ESG influence enterprise value? Utilizing the listed Japanese electrical equipment manufacturing enterprises dataset from 2008 to 2021, we employed the fixed panel linear regression model to confirm the relationship between Ecomark and ESG in enterprise value, and further used a moderating effect model to verify the existence of the crowd-out effect of ESG performance on Ecomark through enterprise value. In addition, a robustness check scheme was designed and performed to test the model settings, outliers and endogeneity issues. The main findings show that the obtaining of Ecomark certification and good ESG performance can help to improve enterprise value, but they may be altered regarding the heterogeneity of environmental information disclosure methods, further causing differences in enterprises’ time and economic cost burdens. Such differences increase the attractiveness of ESGs to investors, thereby crowding out the impact of Ecomark on enterprise value. Our conclusion reveals the mechanism of the heterogeneity of environmental information disclosure methods towards enterprise value, which offers a valuable reference for investors to evaluate enterprise value and paves the way for enterprise decision-makers and authorities to optimize their environmental information disclosure.