Disclosure System Research Articles

The Impact of ESG Standards and Investment : Global Trends and Practices

In recent years, ESG (Environmental, Social, and Governance) investment has significantly integrated into investment strategies worldwide. The concept of ESG investing is not merely a fleeting trend but rather an essential tool for investors looking towards sustainable and responsible investment practices. With the evolution and adoption of ESG investments in the global market, a thorough examination of ESG investment practices reveals valuable insights. Nowadays, in economic landscape, the emphasis on ESG factors in investment decisions continues to grow, underscoring the importance of responsible investing practices in fostering long-term value creation and societal impact. This study offers noteworthy recommendations regarding ESG investment standards, aiming to drive improved ESG performance within enterprises. By adhering to robust ESG criteria, organizations can access enhanced financial prospects, paving the way for them to garner increased social recognition. Besides, this paper also put forward countermeasures and suggestions for China's ESG to improve China's ESG information disclosure system and the awareness of ESG.

The Impact of Environmental Assessment of Green Innovation on Corporate Performance and an Empirical Study

Green innovation is an important part of environmental evaluation, which will promote low-carbon economy and directly or indirectly impact enterprises' development performance. The research on environmental evaluation of green innovation mainly focuses on the theoretical aspect, elaborates on waste recycling, social responsibility, etc., lacks practical research methods, and ignores the impact of green innovation. In order to further study the actual impact of green innovation on environmental assessment and the promotion of enterprise performance, this paper proposes a factor regression analysis method. First of all, as well as related literature, the content and indicators of green innovation are extracted, the indicators are standardized, and the invalid indicators are eliminated. Then, a regression analysis of enterprise performance is carried out according to the indicators to find out the main influencing aspects. Finally, the problematic indicators were analyzed, the causes of the indicators were explored, and relevant countermeasures were proposed based on the regression results. The results of the study show that social supervision (X32), government supervision (X31), environmental report disclosure (X11), profit evaluation system (X23), production competitiveness (X21), Environmental technology (X13) and investment (C) are the main influencing indicators, and the degree of enterprise performance has a significant impact. Therefore, enterprises should start from the aspects of environmental report disclosure, social supervision, and profit evaluation system, and formulate measures and countermeasures to improve the role of environmental assessment in green innovation in promoting enterprise performance.

The Distribution of Burden of Proof in Environmental Civil Public Interest Litigation

Environmental problems, in the current society, have attracted the attention and attention of the society and the public. Relevant laws are applied under the research of legislators and the reference of foreign legal experience. With the development of environmental civil public interest litigation, a series of problems have gradually emerged with judicial practice, and the allocation of the burden of proof is somewhat unreasonable. Through to our country and outside the environment of civil public interest litigation laws and regulations, understand the environment of the characteristics of the burden of proof and analysis its can perfect, points out that should distinguish the application of public welfare and private benefit, refining the causal relationship responsibility distribution, improve the system of proof obstruction, environmental damage appraisal system and environmental information disclosure system and other related measures.

The impact of environmental, social and governance disclosure on stock prices: Empirical research in Vietnam

The aims of this research is to evaluate the impact of Environmental, Social and Governance (ESG) information disclosure (using both financial and non-financial information) on stock prices of businesses in Vietnam; From there, propose recommendations to promote transparent practices and information disclosure about ESG of businesses related activities; Contribute to developing sustainable investment goals in businesses, and the financial market in general. Based on the (Ohlson, 1995) [40] valuation model, and developed by Barth and Clinch (2009) [41] the research was conducted empirically in 30 listed companies in Vietnam in the period 2019–2022. Research results based on the GLS method show that ESG positively impacts stock prices. Additionally, this paper conducted an in-depth analysis of each individual pillar and found that the environmental pillar was considered the most meaningful to market participants. However, the correlation between ESG and stock prices is weakened for environmentally sensitive businesses. This study also makes a valuable contribution to the current literature on non-financial information reporting by using manually collected data and investigating the effects of ESG reporting on market participants in the public system voluntary information disclosure system of an emerging market like Vietnam.

Do Investors’ Site Visits Improve Bond Market Pricing Efficiency? —An Empirical Study from the Secondary Bond Market

ABSTRACT Taking bonds issued by A-share companies listed on the Shenzhen Stock Exchange from 2014 to 2020 as a sample, this paper explores the effect of corporate site visits on bond trading spreads. The study finds that the more investors visit a given firm, the lower the trading spreads of bonds issued by that firm, and this phenomenon is more pronounced in companies with greater information asymmetry or agency conflicts. Further research shows that investors evaluate the financial status of the company more accurately through site visits and reduce irrational decisions caused by information uncertainty. Consequently, site visits reduce the financing gap caused by macroeconomic factors. The results show that personal communication between investors and listed companies could provide effective information for bond investors and reduce their information risk. This paper expands the existing research on issues related to secondary bond market pricing and investors’ site visits and provides important empirical evidence for regulators to use to further optimize the bond market disclosure system to reduce information asymmetry.

Nationwide survey of the secondary findings in cancer genomic profiling: survey including liquid biopsy.

We surveyed the status of the secondary finding (SF) disclosure in comprehensive genome profiling (CGP) in 2020. The situation has changed: increase in the number of hospitals that provide CGP, an update to the Comprehensive Tumor Genomic Profiling: Materials for Review of Secondary Findings (CTGPMRSF), and the addition of a liquid biopsy test, FoundationOne® Liquid CDx (F1L). Moreover, the actual situation was unclear because the 2020 survey did not include all designated and cooperative hospitals. Herein, we conducted a questionnaire survey of all designated-core, designated, and cooperative hospitals to identify the current status and challenges concerning SF in the CGP in 2022. A total of 82.1% of the hospitals responded and 77.7% of the response was from cooperative hospitals. Approximately 80% of the hospitals used CTGPMRSF. SF disclosure, confirmatory test implementation, and SF confirmation rates were 12.4%, 31.6%, and 46.6% for FoundationOne® CDx (F1CDx), respectively, and 6.8%, 31.8%, and 70.7% for F1L, respectively. The implementation rate of the confirmatory test was substantially higher in hospitals with genetic experts and in hospitals that could conduct confirmatory tests on the same day. Our survey provides insight into how SF is handled in Japan. The percentage of cases leading to confirmatory tests has gradually increased, although challenges such as insurance coverage limitations and varied understanding of SF among patients and healthcare providers persist. With the increasing use of whole-genome analysis, our findings will provide valuable insights into establishing an effective SF disclosure system.

Drug company methodologies used for reporting in the UK pharmaceutical industry payment transparency database between 2015 and 2019: A content analysis

Pharmaceutical companies spend hundreds of millions of pounds on marketing/R&D-related payments annually to healthcare organisations and healthcare professionals. UK pharmaceutical industry self-regulatory bodies require member companies who sign up to their code of conduct to publish details of their payments. They are also required to publish the methodologies underlying these payments, namely methodological notes. This study aimed to analyse UK pharmaceutical companies’ methodological notes and their adherence to the Association of the British Pharmaceutical Industry code of conduct and other relevant guidance. We conducted a content analysis of methodological notes for the years 2015, 2017 and 2019 and assessed companies’ adherence to self-regulatory bodies’ requirements and recommendations for methodology disclosure. Overall, 90 companies made payment disclosures in all three years, publishing 269 methodological notes. We found gaps in adherence to self-regulatory requirements. Only 3 (3.3 %) companies provided clear information for all self-regulatory body recommendations and regulations in all of their notes. Companies also varied in their approaches to important areas. For example, of the 244 notes with clear information on VAT management, 36.1 % (N = 88) included VAT, 30.3 % (N = 74) excluded VAT, and 33.6 % (N = 82) had multiple rules for VAT. There was evidence of widespread non-adherence to self-regulatory requirements. This suggests flaws with self-regulation and a need for greater enforcement of rules or consideration of a publicly mandated disclosure system.

Does supply chain transparency affect corporate cleaner production? A study based on the risk spill-over perspective

Taking the Chinese A-share listed companies from 2010 to 2021 as the research sample, this article empirically tests the influence and mechanism of supply chain transparency on enterprise behaviour from the perspective of enterprise cleaner production. First, supply chain transparency has a significant governance effect on enterprise cleaner production. Second, compared with enterprises in high-concentration markets and eastern regions, this governance effect is more significant in low-concentration markets and central and western regions of China. Through the mechanism research, it is found that supply chain transparency can improve the level of enterprise cleaner production through the path of risk spill-over. Finally, the enterprises with weaker dialogue rights in supply chain information disclosure have a stronger governance effect, and this disclosure method has an alternative governance effect on enterprise green information disclosure. This study not only helps to enrich the research on the internal mechanism of enterprise cleaner production from the perspective of supply chain transparency but also guides the information disclosure system to promote enterprise cleaner production.

Research on the Impact of ESG Performance on the Export of Listed Companies

The ESG concept is highly compatible with China's new development concept, but there is no definitive conclusion on whether ESG performance has a positive impact on a company's exports. This article uses A-share listed companies in Shanghai and Shenzhen from 2015 to 2022 as research samples to empirically examine the impact of ESG performance on corporate exports. Research has found that a company's good ESG performance has a significant positive impact on exports. The better the company's ESG performance, the larger its export scale. This article has certain enlightening significance for enterprises and investors to attach importance to ESG performance, and for government departments to improve ESG information disclosure systems.

Analysis of the "Greenwashing" Phenomenon in the ESG Investment Environment

With the continuous development of the green financial market and the evolution of ESG reports, the corresponding "greenwashing" problems emerge in endlessly. This study takes ESG reports and enterprise greenwashing papers from 2022 as the object of analysis and reviews the research results in this field from the aspects of classification, causes, expression forms, influence and governance of greenwashing phenomena. According to the analysis. with the increasing scale of China's green finance market, the forms of greenwashing are gradually diversified. The imperfect information disclosure system, the asymmetry of market information and the more pursuit of short-term interests by enterprises are the main factors for the occurrence of greenwashing phenomenon. The impact of green analysis from consumer, corporate governance, gradually to the social and environmental level. Based on the above content, the research puts forward many governance opinions on greenwashing behavior, e.g., improving the system and unified standards from the government level as the perspective, strengthening information disclosure and news media supervision from the market perspective, strengthening internal governance from the perspective of enterprises, and improving the level of professional knowledge.

Research on the Mechanisms by Which Green Finance Policies Promote Low-Carbon Economic Development

This paper explores the mechanisms by which green finance policies promote low-carbon economic development, analyzing their implementation effects and challenges in China, and proposing corresponding policy recommendations. Green finance, defined as financial activities supporting environmental protection and sustainable development, aims to direct funds towards environmentally friendly and low-carbon projects. It includes green credit, green bonds, green investment funds, and green insurance, and involves providing preferential loans, issuing green bonds, establishing investment funds, and developing insurance products to support green projects and reduce environmental risks. Additional policies such as green incentives, environmental information disclosure, green ratings, and international cooperation further enhance the effectiveness of green finance. The mechanisms by which green finance policies promote low-carbon development include guiding funds to low-carbon industries, optimizing resource allocation, promoting technological innovation, supporting industrial structure transformation, enhancing market competitiveness, and promoting socially responsible investment. Despite significant progress, challenges such as insufficient supply of green finance resources, regional disparities in policy implementation, limited innovation in green finance products, and imperfect information disclosure and regulatory systems remain. The paper concludes with policy recommendations to increase policy support, improve information disclosure and regulatory systems, promote product innovation, strengthen regional coordinated development, and enhance international cooperation.

Can climate-related information disclosures strengthen green innovation capacity? Firm-level evidence using textual analysis

This study presents novel insights on modelling the implications of voluntary climate-related information disclosure on corporate green innovation (GI) in China. Based on a constructed dataset of 13,664 firm-year observations between 2014 and 2020, we quantify climate-related disclosures under the Task Force on Climate-Related Financial Disclosures framework using computerized text analysis. Our findings show that climate-related information disclosure substantially bolsters corporate green innovation after addressing endogeneity concerns. However, the promoting effects vary drastically across industry attributes, ownership structure, and environmental regulations. Further channel analysis demonstrates that “greenwashing” behaviours and financial constraints adversely moderate the nexus between climate-related information disclosure and green innovation of firms, while digital finance positively moderates it. Overall, this study enriches the literature and offers practical implications for firms engaging in the green innovation process more effectively under a more transparent environment-related disclosure system.

Macroeconomic news and price jumps: evidence from ETFs and LOFs in China

PurposeWe examine the relationship between macroeconomic news and fund price jumps, using high-frequency 5-min intraday data for Exchange Traded Funds (ETFs) and Listed Open-end Funds (LOFs) from 2019 to 2020.Design/methodology/approachWe utilize the non-parametric jump test known as the LM method to detect fund price jumps. In addition, we perform Logistic regression to analyze the relationship between macroeconomic news and fund price jumps. Moreover, we use multiple linear regression to explore the relationship between fund price jumps and subsequent returns.FindingsThe probability of price jumps increases by 22.56% when macroeconomic news is released. Moreover, the returns associated with news-driven price jumps display a reversal pattern, and there is an asymmetric relationship in subsequent returns following macroeconomic shocks. Specifically, funds tend to exhibit lower returns after news-driven price jumps compared to those that are not influenced by news events.Research limitations/implicationsIn today's digital age, investors have unprecedented access to a wealth of information through the Internet and various communication platforms. News and market data can be instantly accessed and disseminated, allowing for swift dissemination of information to investors worldwide. However, despite this enhanced accessibility, investors continue to exhibit overreactions or underreactions to new information.Practical implicationsMacroeconomic news release provide crucial insights into the overall health and performance of the economy. By monitoring and analyzing these indicators, investors can gain valuable information that can guide their investment decisions. Furthermore, by fostering a transparent and reliable information disclosure systems, governments can play a critical role in ensuring the stability and transparency of the funds market.Originality/valueThe paper utilizes 5-min high-frequency data from funds and incorporates a comprehensive macroeconomic news information database. These methodological choices enhance the precision and reliability of the analysis, allowing for a more nuanced understanding of the relationship between macroeconomic news releases and fund price jumps.

Integration of digital technologies in anti-corruption initiatives in Botswana: lessons from Georgia, Ukraine and South Africa

Purpose This paper aims to explore the potential role of digitalization in reshaping Botswana's assets and liabilities declaration system. Digitalization presents opportunities to not only improve efficiencies in how services are delivered and citizens are engaged but also to integrate innovative ways to combat wicked problems such as illicit enrichment and conflicts of interest in the public service. Design/methodology/approach This qualitative paper adopts an exploratory research design to investigate how digital technologies can be used to enhance anti-corruption reforms in a developing country context. Primary data, focusing on the shortcomings and successes of Botswana’s asset declaration system, were collected from interviews with key policy actors in Botswana’s anti-corruption landscape, whereas secondary data were drawn from documents such as official reports, news and social media reports and available literature on the topics of digitalization and anti-corruption reforms. A comparative case study approach is used, highlighting successes and challenges in the use of electronic disclosure systems in Georgia, Ukraine and South Africa. Findings The analysis provides insights into the potential benefits and challenges associated with the integration of digital technologies in the asset and liability declaration process. The integration of digital technologies in the anti-corruption efforts of Georgia, Ukraine and South Africa has contributed to the development of robust electronic declaration systems. However, political resistance, costs, technical capacity and verification processes are identified as some of the core challenges confronting agencies tasked with implementing asset declaration systems. Research limitations/implications The political and socio-economic contexts in the country case studies presented are distinct, as are the challenges posed by corruption. Although Botswana can gain insights from the implementation experiences of Georgia, Ukraine and South Africa, policymakers and implementers need to take into account these subtleties and their potential influence on the success or failure of a similar system. The research has implications for policy and practice by proposing an alternative approach to the implementation of Botswana’s asset declaration system. This will be of interest to policymakers, anti-corruption activists and scholars. Originality/value To the best of the authors’ knowledge, prior research has not studied the relationship between digitalization and anti-corruption reforms in Botswana. This paper contributes to the dearth of knowledge regarding the role of digitalization as a driver of anti-corruption reforms. The paper informs policy decisions related to the implementation of digital transformation initiatives in line with Botswana’s anti-corruption and digital transformation agendas.

Narrative innovation disclosure and stock price crash risk: Evidence from Chinese listed firms

Using the 2012 revision of Guideline No. 2, we construct a difference-in-differences model to investigate the impact of narrative innovation disclosure on stock price crash risk among Chinese A-share listed firms from 2008 to 2020. We find that narrative innovation disclosure positively affects a firm’s crash risk. From the dual perspectives of the discloser and receiver, we reveal the mechanism. The strategic behaviors of firms with limited creativity, combined with investors’ challenges in fully comprehending innovations, contribute to increased information asymmetry and reduced the quality of disclosures, thereby rising stock price crash risks. Furthermore, we show that the impact of innovation disclosure on crash risk is more significant in firms operating within poor legal and market environments, and in those with overvalued stock prices. This study provides suggestions for improving the innovation disclosure system to reduce stock price crash risks and promote stability in capital markets for emerging countries.

Creditor Protection and Enterprise Earnings Management —A Test Based on Bond Covenants

ABSTRACT Excessive earnings management can significantly reduce the quality of accounting information, consequently harming the interests of investors and creditors. In the Chinese market, research on earnings management focuses primarily on corporate governance and external environmental viewpoints, with limited literature addressing debt governance. This paper centers on exploring the protective impact of bond covenants, revealing their inhibitory effect on both accrual and real earnings management through two potential mechanisms (agency conflicts and risk-taking). Furthermore, this study conducts a heterogeneous analysis from various perspectives, identifying how bond covenants influence earnings management in different ways and underscoring the moderating role played by underwriters. The findings offer theoretical insights for the development of a high-quality information disclosure system.

The effect of ESG performance on corporate green innovation

PurposeThe transition to green growth goals requires the concerted efforts of the whole society. Enterprises, as important players in the market, play a key role in promoting green and sustainable development. The rise of the concept of sustainable development has enabled more enterprises to disclose environmental, social and governance (ESG) information, and ESG behaviour is regarded as a positive strategic behaviour to implement the new development concept. This paper aims to explore the influence of ESG performance on enterprise green innovation.Design/methodology/approachThis study applies a fixed effect model and the regulation effect of empirical analysis to explore the influence of ESG performance on enterprise green innovation. The object of investigation is 2014–2021 Shanghai and Shenzhen A-share listed companies.FindingsThe results of an empirical analysis outline the following conclusions: (1) ESG performance has a significant effect on enterprise green innovation, mainly by easing the pressure of the financing enterprise, fitting stakeholders’ environmental protection concept and obtaining employee organizational identity that influences enterprise green innovation. (2) Government regulation positively regulates the role of ESG performance in promoting the green innovation of enterprises. (3) Heterogeneity analysis found that the strengthening role of ESG performance on the green innovation of enterprises is stronger in green invention patents, state-owned enterprises and nonheavily polluting industries.Research limitations/implicationsDespite the valuable findings, this study has a few limitations. Thus, it is necessary to extend the object of investigation by adding other Asian countries, which allows for comparison analysis and allocating best practices for promoting green innovation. Besides, innovation and ESG performance depend on the quality of institutions. In this case, the future study should incorporate the indicators that reveal the quality of institutions (corruption, transparency, digitalisation, voice, accountability, etc.).Practical implicationsAccording to the above conclusions, this paper proposes suggestions at the level of enterprises, government and investors. At the enterprise level, ESG responsibility should be strengthened, ESG information should be consciously disclosed and the quality of ESG disclosure should be improved. Government departments should play the role of supervisors, improve the construction of ESG information disclosure systems and promote the formation of ESG systems. At the social level, investors should improve the ESG information status and pay more attention to the ESG performance of enterprises.Originality/valueThis study fills the scientific gaps in the analysis impact of ESG performance on the green innovation of enterprises. This paper contributes to the theoretical landscape of ESG efficiency by developing approaches based on two empirical models: testing the impact of enterprise ESG performance on green innovation and testing whether government regulation plays a regulatory role in the relationship between ESG performance and green innovation. Besides, this study analysed the ESG performance and green innovation within the following categories: heavy and nonheavy polluter industries; state and nonstate-owned enterprise groups.

Evaluation index system for carbon information disclosure quality in China's electric power sector based on a mutual information and back propagation neural network model

This paper employs the Mutual Information (MI) and Back Propagation (BP) neural network model to screen the preliminarily constructed evaluation index system for carbon information disclosure (CID) quality of public companies in China's electric power sector (EPS), which is subsequently incorporated into the fuzzy comprehensive evaluation (FCE) method for evaluation application. The results show that (1) after screening, 19 out of the 31 preliminarily constructed indicators constitute an optimal index set, and (2) the evaluation application of the screened index system validates the feasibility and applicability of the index system. Simultaneously, the evaluation results reveal a generally low CID quality in the EPS.

ESG disclosure standards: international and chinese case studies

This study is dedicated to revealing the implications of international ESG (Environmental, Social, Governance) disclosure standards and practices for China. The research task is to systematically sort out and analyze the current mainstream international ESG standards and their latest developments. At the same time, combined with China’s ESG disclosure policies and practices, it provides helpful references for formulating ESG disclosure standards and frameworks with Chinese characteristics. This paper is based on processing secondary data obtained through qualitative analysis of relevant literature and official government documents (plans, strategies, reports, and programs). The paper suggests that the current Chinese government needs to (1) formulate an ESG disclosure standard system with Chinese characteristics; (2) guide ESG market entities to jointly participate in the formulation and development of the ESG standard system; (3) create a mandatory ESG disclosure system.

Disclosure frequency of parent company financial reporting: Insights from analyst forecasting accuracy

AbstractPrior research predominantly concentrates on the comprehensive financial disclosures of consolidated statements, often overlooking the distinct informational value inherent in the financial statements from parent companies. The debate continues on whether the frequency of disclosures from parent companies should align with that of their consolidated counterparts. The periodic dissemination of a parent company's financials can significantly reduce information asymmetry, thus enabling analysts to promptly and accurately grasp the firm's financial health. Yet, this increased frequency may come at the cost of information reliability, leading to more errors and promoting myopic decision‐making among executives, which might lead to misguided analysis. Drawing on shifts in China's financial disclosure mandates – from obligatory to optional quarterly reporting by parent firms – we observe that analysts tend to generate more precise earnings forecasts for those publicly traded entities that refrain from quarterly disclosures of parent company reports. This enhancement in forecast precision is particularly marked in instances where corporate information quality is substandard or when analyst coverage is extensive. Supplementary findings suggest that this effect intensifies for annual reports audited by firms outside the Big 4 and when there is more coverage by other media. Consequently, our findings imply that easing the stringent quarterly reporting by parent companies and adopting a voluntary disclosure system does not diminish the informational richness available to investors.