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Corporate sustainability, earnings persistence and the association between earnings and future cash flows

Citation

Jia, J and Li, Z, Corporate sustainability, earnings persistence and the association between earnings and future cash flows, Accounting and Finance pp. 1-38. ISSN 1467-629X (2021) [Refereed Article]

Copyright Statement

© 2021 Accounting and Finance Association of Australia and New Zealand

DOI: doi:10.1111/acfi.12791

Abstract

Using data from Australian listed firms from 2002 to 2018, we found that firmsí sustainability performance is associated with higher future earnings and cash flows. We also revealed that firmsí sustainability performance was positively related to earnings persistence and had a positive effect on the association between earnings and future cash flows. Our findings support resource-based theory and the theoretical argument indicating a positive relationship between firmsí sustainability performance and earnings quality. This paper enriches the literature by showing that firmsí sustainability performance reveals information about their future financial prospects and earnings quality.

Item Details

Item Type:Refereed Article
Keywords:Corporate sustainability, cash flows, earnings, earnings quality, earnings persistence
Research Division:Commerce, Management, Tourism and Services
Research Group:Accounting, auditing and accountability
Research Field:Financial accounting
Objective Division:Commercial Services and Tourism
Objective Group:Environmentally sustainable commercial services and tourism
Objective Field:Management of gaseous waste from commercial services and tourism (excl. greenhouse gases)
UTAS Author:Jia, J (Dr Jing Jia)
ID Code:147869
Year Published:2021
Web of Science® Times Cited:2
Deposited By:TSBE
Deposited On:2021-11-19
Last Modified:2022-01-12
Downloads:0

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