Relations between corporate economic performance, environmental disclosure and greenhouse gas emissions: new insights.

Hassan, Omaima; Romilly, Peter

Abstract

This study examines the associations and causations between corporate economic performance, environmental disclosure and greenhouse gas emissions, utilizing a large, longitudinal, multi-country dataset disaggregated between developed and developing countries. The methodology uses a simultaneous equation model with system estimation to deal with endogeneity between the variables, and Granger causality tests to indicate their direction of causation. A robust result is that lower emissions are strongly associated with better economic performance. After pretesting for stationarity, we find evidence of a one-way causation from emissions and environmental disclosure to economic performance, but no evidence of reverse causation. We also find strong evidence of a one-way causation from emissions to disclosure, but no evidence of reverse causation. The overarching policy implication is that environmental performance, as measured by greenhouse gas emissions, plays a crucial role in the formulation of business strategy at the firm level and government environmental policy at national and international levels.

Citation

HASSAN, O. and ROMILLY, P. 2021. Relations between corporate economic performance, environmental disclosure and greenhouse gas emissions: new insights. Presented at 2nd Modern management based on big data international conference 2021 (MMBD2021), 8-11 November 2021, [virtual conference].

• Presentation Conference Type: Lecture
• Conference Name: 2nd Modern management based on big data international conference 2021 (MMBD2021)
• Conference Location: [virtual conference]
• Start Date: Nov 8, 2021
• End Date: Nov 11, 2021
• Deposit Date: Nov 15, 2021
• Publicly Available Date: Dec 9, 2021
• Publisher: Wiley
• Keywords: Economic; Environmental; Performance; Disclosure; Greenhouse gases; Environmental policy
• Public URL: https://rgu-repository.worktribe.com/output/1526068
• Related Public URLs: http://hdl.handle.net/10059/2632
• Additional Information: This presentation is based on the following published paper: HASSAN, O.A.G. and ROMILLY, P. 2018. Relations between corporate economic performance, environmental disclosure and greenhouse gas emissions: new insights. Business strategy and the environment [online], 27(7), pages 893-909. Available from: https://doi.org/10.1002/bse.2040