Disclosure Quality Research Articles

Does Green Finance Policy Contribute to ESG Disclosure of Listed Companies? A Quasi-Natural Experiment from China

In 2016, the People’s Bank of China (PBC) together with multiple departments issued the Guidance on Building a Green Financial System (the Guidance), which marked a great breakthrough in China’s green finance policy. Aiming to clarify the actual impact and underlying mechanisms of green finance policy on Chinese listed companies’ ESG disclosure quality, this study employs the difference-in-differences (DID) model and examines the impact of the Guidance on ESG disclosure practices of A-share listed companies on the Shanghai Stock Exchange (SSE) and the Shenzhen Stock Exchange (SZSE) during the period 2006 to 2022. This study reveals a positive correlation between the Guidance and listed companies’ ESG disclosure. Upon further examination, it becomes evident that the Guidance has a more noticeable positive impact on the quality of ESG disclosure among listed companies that operate in industries with high levels of pollution, state-owned enterprises, and regions that exhibit greater levels of economic development. This paper provides essential insights to policymakers, facilitating a deeper understanding and more thorough assessment of the economic implications of green finance policies. Additionally, it acts as a strategic resource for listed companies, guiding the enhancement of corporate ESG disclosures and the implementation of ESG strategies influenced by green finance policies.

Forward Looking Disclosure and Its Determinants: Empirical Evidence from the Listed Banks of Bangladesh

Forward looking information is an emerging issue in academic and corporate arena. Today’s dynamic and competitive business world, the disclosure of forward looking information gives competitive advantages. The main objective of the study is to empirically find out the extent of forward looking disclosure and it’s determinants in the banking sector of Bangladesh. To conduct the study total 120 firm years are considered as sample from 30 listed banks from DSE as sample during the period 2017 to 2021. The average mean value of forward looking information is 38% which indicates poor quality of forward looking information in the most regulated sectors of Bangladesh. The results using multivariate regression analysis shows that board independence, audit firm size and firm’s profitability have positive and significant relationship with forward looking disclosure index (FLDI). This study also finds that foreign ownership, board size and audit independence have significant negative relationship with FLDI. But this study didn’t find any significant association of forward looking information with firm size, female board members, sponsor /directors in the banking sector of Bangladesh. To the best of our knowledge, there is scarcity of research that has been examined the disclosure of forward looking information and it’s determinants in banking sector of Bangladesh as well as very limited work is done in other sectors. The study will contribute to the existing scarce literature and may influence the policymakers and regulators to incorporate regulations to increase the quality and extent of forward looking disclosure.

Valuation effect of the extent and quality of corporate sustainability disclosure across sectors in Nigeria

Valuation effect of the extent and quality of corporate sustainability disclosure across sectors in Nigeria

Managerial overconfidence and corporate information disclosure

By extracting detailed birth information for managers of Chinese listed firms from 2011 to 2021, we developed a novel measure of overconfidence and applied it to the corporate information disclosure. Our findings demonstrated a close association between managerial overconfidence and both mandatory and voluntary disclosure behaviors exhibited by firms. Specifically, managerial overconfidence significantly contributed to an increase in accrual-based earnings management and the voluntary disclosure of Corporate Social Responsibility (CSR) information by firms. Furthermore, we observed that overconfident managers were more inclined to adopt a positive disclosure tone and tend to underestimate future risks in forward-looking information disclosure. In our additional analysis, we uncovered evidence suggesting that various factors, including corporate governance practices, the types of actual controllers, financing constraints, analyst following, and market competition, might all play a role in influencing corporate information disclosure behavior driven by managerial overconfidence. This study expands on the economic implications of the Upper Echelons Theory and offers pertinent recommendations to enhance the quality of information disclosure.

The impact of stock liquidity on corporate environmental information disclosure: Does climate risk matter?

<p>From the perspective of the Chinese market microstructure, we took Chinese A-share listed companies as samples to explore the impact and mechanism of stock liquidity on the quality of corporate environmental information disclosure (EID). Our results indicated that stock liquidity has a positive impact on the quality of corporate EID. Using the stock market interconnection events of the 2014 Shanghai-Hong Kong Stock Connect and the 2016 Shenzhen-Hong Kong Stock Connect as a quasi-natural experiment and applying the Ⅳ approach, the research results remained robust after controlling for endogeneity issues. Moreover, both climate physical risk and climate transition risk positively regulated the relationship between stock liquidity and the quality of corporate EID. Further analysis revealed that the positive impact of stock liquidity on the quality of corporate EID is determined by the information effect path and governance effect path of stock liquidity, and the role of the information effect path is more important. In summary, stock liquidity has had an important feedback effect on Chinese companies' active EID behavior through two pathways: Information effect and governance effect.</p>

Stages and Pedagogical Conditions for Forming Performance Phrasing Skills of Future Musical Art Teachers in the Process of Teaching Playing Wind Instruments

The article presents the justification of the step-by-step methodology of forming future musical art teachers’ culture of performing phrasing in the process of learning to play wind instruments. The problem of formation of the specified professional quality, which is considered as a segment of performance training that ensures the quality of the artistic-figurative disclosure of the meaning of a musical work, has been actualized. The essence and component structure of the culture of performing phrasing, which is made up of certain relevant performing skills, and the criteria for their assessment make it possible to classify three levels of their formation: high – “meaningful expressive phrasing”, medium – “aspiration for expressive phrasing”, low – “weak perception of phrasing”. Three stages are presented, according to which the introduction of pedagogical conditions is carried out, each of which aims to positively influence the components of the culture of performing phrasing. At the first stage – motivational-setting – the pedagogical condition of stimulating a meaningful attitude towards the skills of performing phrasing is introduced, which affects the component: “motivation of artistic-technical excellence”. At the second stage – practice-oriented – such pedagogical condition is introduced as the purposeful assimilation of various forms and types of phrasing in the context of the evolution of styles and genres, which affects the component: “competence in working on the performing repertoire and musical texts of pieces”. At the third stage – self-methodological – the pedagogical condition of the activation of methodological self-efficacy in performing and educational processes is introduced, which affects the component: “artistic-communicative content of creative-performing and pedagogical interpretation of musical works for wind instruments (solo, ensemble)”.

Research on the relationship between ESG disclosure quality and stock liquidity of Chinese listed companies

<abstract> <p>In this article, we aim to verify the relationship between ESG disclosure quality and stock liquidity of listed companies and to provide a detailed analysis of its mechanisms. Based on the theories of information asymmetry, signal transmission, reputation, and stakeholder, we summarize and analyze the theoretical and logical framework of how ESG information disclosure can impact stock liquidity. Following the fixed effect (considering individual, year, and industry), panel model was applied to empirically test the relationship between ESG disclosure score and stock liquidity with data ranging from 2012 to 2021. The research findings indicate that improving the quality of ESG disclosure by companies can significantly enhance the level of stock liquidity. Furthermore, we analyze and verify through mechanism tests that ESG disclosure can influence stock liquidity by increasing analyst attention and media coverage (information effect) and enhancing reputation (reputation effect). From a theoretical perspective, the paper enriches the research related to the economic impact of ESG information disclosure and factors affecting stock liquidity. Also, we validate theories connected to information and reputation. From a practical perspective, the research has specific reference value for policymakers, enterprise managers, and investors.</p> </abstract>

Public Demand Oriented Quality Evaluation Model for Rainstorm Disaster Information Disclosure

By investigating the current situation of information disclosure and public demand during rainstorm disaster in Henan Province, this paper builds a model of factors affecting the quality of information disclosure characterized by rainstorm disaster information based on TOE framework theory, metadata evaluation model, resource based theory and resource confirmation theory. With the help of the current situation and demand characteristics of the public’s actual information acquisition, it designs a model with information disclosure content quality, information disclosure accessibility, information disclosure process completeness 10 test dimensions of government information disclosure ability, government feedback ability, minimum information disclosure acceptance ability, information disclosure technology support ability, right to know protection ability, privacy protection ability, right to equality protection ability, and 35 test items of rainstorm disaster information disclosure quality impact factor evaluation scale. The research provides help for government information disclosure to more accurately identify public needs, provides targeted evaluation models and operable evaluation models for rainstorm disaster information quality evaluation in Henan, and provides ideas and strategies for improving rainstorm disaster information quality.

Does internationalization improve environmental disclosure willingness and quality? The moderating role of green investors.

Environmental issues have gradually become a key concern for society. The public has been paying increasing attention to corporate environmental disclosure and performance. With the "go global" trend, more and more enterprises are looking to overseas markets for new technologies and resources. Multinational enterprises (MNEs) are facing more challenges than domestic enterprises. To remain competitive and sustainable, enterprises from developing countries need to gain a foothold in developed countries. We explore how MNEs' internationalization impacts environmental disclosure, specifically focusing on the role of green investors as stakeholders. We draw evidence from Chinese-listed MNEs, with a total of 4,709 panel data observations. For the main analysis, we use a fixed effect model. The findings suggest that a higher level of internationalization can improve both the willingness and quality of environmental disclosure for MNEs, and this relationship is further strengthened by green investors. A heterogeneity analysis reveals that the positive effect of internationalization on environmental disclosure is mainly present in state-owned enterprises (SOEs) and developed host countries. We find that external pressure from host countries motivates MNEs to increase environmental disclosure willingness and quality. This study provides valuable insights for MNEs from emerging economies on how to achieve legitimacy and a positive reputation in overseas markets through environmental disclosure strategies. This study proposes the importance of green investors on environmental disclosure issues from a stakeholder perspective and provides new theoretical insights for environmental policy reform in developing countries such as China.

Controlling shareholders' share pledge and share repurchase notices of listed companies.

States encourage listed companies to use stock repurchase to elevate the market value of listed firms. After China's promulgation of the new Company Law in 2018, the number of listed companies that issued stock repurchase notices has increased, and the frequency is also increasing. But whether market value management is the real incentive for the action remains debatable. To reduce the risk of pledges, controlling shareholders may use stock repurchases to maintain the security of control rights, and stock repurchase notice may become a tool for controlling shareholders to manage pledge risks. From the perspective of pledge risk management, this paper selects the listed companies from 2012 to 2019 and finds that the share pledge of the controlling shareholder affects the stock repurchase behavior of listed companies by affecting the current pledge risk and the quality of information disclosure plays the interactive role between the two.

Carbon Information Disclosure Quality and Corporate Financial Performance-Based on Empirical Data from the Electricity and Heat Production and Supply Industry

Carbon Information Disclosure Quality and Corporate Financial Performance-Based on Empirical Data from the Electricity and Heat Production and Supply Industry

The Eco-Friendly Side of Analyst Coverage: The Case of Green Innovation

Green innovation is a key solution to resource depletion and natural environment deterioration. It is advancing the march toward marrying business with sustainability worldwide. Embodying green elements in core innovative activities naturally becomes the critical information for the external assessments of organizations. To identify this information channel effect, the current study is intended for shedding light on the effects of financial analysts, a prominent and professional stakeholder group, on corporate green innovation. Combining the comprehensive incoPat database with the data of Chinese publicly listed manufacturing firms over the period from 2003 to 2017, the empirical results show that analyst coverage could significantly improve firms’ green innovation performance. It is also observed both institutional ownership and stock liquidity significantly enhance the positive relationship between analyst coverage and corporate green innovation. The information-based mechanisms are further identified by the split sample analysis based on the quality of financial information, when either the choice of audit company or the disclosure quality rank is applied. These findings provide beneficial supports for the idea that leaning on the monitoring from the financial analysts, managers could be encouraged to promote green investment with its long-time horizon and correct the myopia that overly focuses on short-term performance.

Exploring the disclosure quality of Integrated Reporting in India

Exploring the disclosure quality of Integrated Reporting in India

Exploring the disclosure quality of integrated reporting in India

Exploring the disclosure quality of integrated reporting in India

The Effect of Quality Disclosure on Firm Entry and Exit Dynamics: Evidence from Online Review Platforms

The Effect of Quality Disclosure on Firm Entry and Exit Dynamics: Evidence from Online Review Platforms

The Impact of Corporate-and Country-level Governance Mechanisms on the Firm's Disclosure Quality: Evidence from MENA Countries

Purpose: The paper aims to investigate the impact of corporate and country-level governance mechanisms on the firm's disclosure quality.
 Design/methodology/approach: The paper employs a panel dataset comprising 96 financial institutions listed on the stock markets of four countries in the MENA region: Palestine, Jordan, Kuwait, and Qatar. This dataset spans five years, from 2016 to 2020. Data primarily originate from the annual reports of these institutions and are subjected to analysis through pooled OLS, fixed effect (FE), and random effect (RE) methodologies.
 Findings: The main findings of this study reveal that corporate governance (CG) factors, including board size, board meetings, and audit committee size, have a positive impact on disclosure quality. Additionally, concerning country-level governance, the role of law positively influences disclosure quality, whereas political stability and corruption negatively influence disclosure quality.
 Research limitations/implications: This study's main limitations are missing data, especially regarding the audit committee information, and the lack of a database covering the firms in the MENA region. The findings can help managers, policymakers, and other stakeholders enhance the firm's disclosure by adopting good corporate and country- level governance practices.
 Originality/value: The study develops a disclosure quality index that examines various disclosure requirements attributes, encompassing financial and non-financial disclosure aspects. Such an index adds value to prior research on disclosure quality. Additionally, this study expands the scope of previous research by incorporating wide aspects of CG attributes and investigating the role of country-level governance.

DOES FOREIGN OWNERSHIP AND FOREIGN BOARD MEMBER IMPROVE THE QUANTITY AND QUALITY OF SUSTAINABILITY REPORTING AMONG NON-FINANCIAL LISTED FIRMS IN NIGERIA?

The purpose of this study is to investigate the impact of foreign ownership and directorship on sustainability disclosures of non-financial listed firms in the developing countries. Sample consisted of 30 firms across the seven sectors of non-financial listed firms in Nigeria, covering a period of 5 years, 2016 – 2020. Analysis of data collected was carried out from three perspectives, first content analysis of sustainability quantity and quality disclosures by the sampled firms, using 97 indicators based on the GRI 2016 standards was carried out, with the 30 firms divided into two, firms with and without foreign ownership and directorship. The result was analysed using t-test to determine whether there was a significant difference between the means of the two groups. Then correlation between sustainability disclosures and foreign ownership and directorship was determined. Finally, an ordinary pooled regression analysis was carried out to determine the effect of foreign ownership and directorship on sustainability disclosures. T-test results showed positive significant difference between sustainability reporting quantity and quality disclosures of firms with and without foreign ownership and directorship. It was also found that sustainability quantity and quality disclosures were positively correlated with foreign ownership and directorship. Furthermore, the regression analysis showed that foreign ownership has a positive significant effect on sustainability quantity disclosure at 5% (0.150) but an insignificant effect on sustainability quality disclosures. Foreign directorship has positive significant effect on sustainability quantity and quality disclosures at 1% (9.731) and 5% (6.466) respectively. It is recommended that sustainability reporting should be made compulsory by the Financial Reporting Council of Nigeria, having adopted the first two standards issued by the International Sustainability Standards Board (ISSB).

The Value Relevance of Sustainability Disclosure Quality

In the contemporary landscape, ESG (environmental, social, and governance) performance has emerged as a pivotal concern for capital market investors. Despite its prominence, the ongoing debate in the literature regarding the value relevance of ESG underscores the need for empirical insights. This study addresses this gap by investigating the moderating role of ESG disclosure quality in shaping the relationship between earnings, annual changes in earnings, and stock returns. Drawing on a dataset comprising 254 firm-year ESG reports in Indonesia from 2017 to 2022 and employing panel data regression, the research unveils compelling results. It demonstrates that high-quality ESG disclosure not only reinforces the impact of earnings and annual changes in earnings on stock returns but also signifies a lower risk of future sustainability and long-term growth. These findings substantiate the idea that robust integration of sustainability principles in business practices contributes significantly to the creation of shareholder value. Importantly, this research carries profound implications for Indonesian companies, emphasizing the critical role of ESG disclosure in fostering sustainable business practices and enhancing shareholder value in the evolving landscape of capital markets.

EFFECTS OF FIRM-SPECIFIC VARIABLES ON CORPORATE SOCIAL RESPONSIBILITY: AN EMPIRICAL STUDY

Corporate Social Responsibility (CSR) is one of the pivotal determinants of promoting corporate brand and long-term reputation. Traditionally, firms operate to maximize profits and wealth for shareholders. Nowadays, they are constantly facing pressures from society and stakeholders to operate businesses in a socially responsible and environment-friendly manner while creating value for shareholders, stakeholders, and society. CSR is considered an important business strategy and a source of competitive advantage for many firms. There are ongoing debates about what drives corporate social responsibility. Historically, scholars and managers believed that CSR is a voluntary activity that firms pursue to optimize social welfare and protect the environment. Shareholders and stakeholders are more aware of firms’ activities to optimize wealth and social welfare which creates pressures on firms. Previous literature shows the effects of corporate governance, firm size, CEO gender, and legal systems on CSR practice. This study explores a significant research gap in measuring the relationships of firm-specific factors (e.g., disclosure quality, total investment, total revenue, R&D expenses, marketing and advertising expenses, and earnings per share) on CSR practice. The study conducted an empirical analysis based on 38 samples. The contribution of the study will facilitate researchers and policymakers to focus on important aspects that attribute firms’ potential for CSR practice.

지배구조와 ESG 공시품질

지배구조와 ESG 공시품질