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Effect of mandatory sustainability disclosure announcements: cross-country evidence

Citation

Li, Z and Jia, J, Effect of mandatory sustainability disclosure announcements: cross-country evidence, Pacific Accounting Review pp. 1-29. ISSN 2041-5494 (2021) [Refereed Article]

Copyright Statement

Emerald Publishing Limited

DOI: doi:10.1108/PAR-09-2020-0141

Abstract

Purpose This study aims to examine whether announcements of mandatory sustainability disclosure affect corporate sustainability performance (CSP).

Design/methodology/approach The authors use a quasi-experiment provided by mandatory sustainability disclosure announcements that occurred in 21 countries from 20062016. A difference-indifferences method is adopted. The authors restrict the drawing of all candidate treatment and control firms to a pool of firms that did not disclose sustainability information one year before the announcements.

Findings The authors find that the announcements of mandatory sustainability disclosure are positively related to CSP. The positive effect is more pronounced for firms in countries with higher anticipation effects and lower awareness effects. Specifically, the authors find that the effect of the announcements is more pronounced in a country where the rule of law is higher and stakeholders are less likely to initiate communication about sustainability with firms, and with fewer active participants in and signatories to the United Nations Global Compact initiative. The findings hold under different robustness analyses.

Originality/value The study enriches the knowledge about the effect of the announcements of comprehensive mandatory sustainability disclosure by analysing the consequences of these announcements. In the contribution to this growing stream of research, the authors provide evidence on the consequences of the announcements based on a cross-country sample and importantly, focusses on the non-economic consequences.

Item Details

Item Type:Refereed Article
Keywords:sustainability performance, difference-in-differences, CSR performance, mandatory sustainability disclosure
Research Division:Commerce, Management, Tourism and Services
Research Group:Accounting, auditing and accountability
Research Field:Sustainability accounting and reporting
Objective Division:Information and Communication Services
Objective Group:Environmentally sustainable information and communication services
Objective Field:Environmentally sustainable information and communication services not elsewhere classified
UTAS Author:Jia, J (Dr Jing Jia)
ID Code:147871
Year Published:2021
Web of Science® Times Cited:3
Deposited By:TSBE
Deposited On:2021-11-19
Last Modified:2022-01-17
Downloads:0

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