Corporate Environmental Performance, External Environmental Monitoring And Stock Price Volatility

Since the reform and opening up more than 40 years ago,China’s economy has been driving on the fast track of high-speed development.With the rapid development of China’s economy,environmental problems have become increasingly prominent.China’s environmental quality has undergone an evolutionary process from good to worse to relatively better overall.Environmental problems are gradually exposed in the public’s view,and the voice of environmental protection is increasingly rising.The report to the 19 th national congress of the communist party of China declared that socialism with Chinese characteristics has entered a new era,which means new development.The new development concept defines "green" as one of the key words.The report to the 19th national congress of the communist party of China(CPC)made it clear that "we should promote green development,accelerate the establishment of a legal system and policy guidance for green production and consumption,and establish and improve an economic system for green,low-carbon and circular development.To firmly establish a protection of ecological environment is to protect productivity,improve the ecological environment is the concept of the development of productivity ",in this context,this article will focus on focus on the environmental pollution caused by the serious industry,research the company’s internal environment governance,external environmental supervision to listed company’s share price fluctuations.Try to analyze and verify the impact of environmental problems of polluting enterprises on their stock prices,so as to call on the public and enterprises to pay attention to environmental problems and always abide by the concept of sustainable development.Through theoretical analysis and empirical analysis,we find that,first of all,the internal environmental performance of polluting enterprises and the environmental investment of enterprises have a significant impact on their stock price volatility.Among them,(1)the internal environmental performance of polluting enterprises and the investment of enterprises in environmental protection reflect the attention and attention of enterprises to environmental protection issues;(2)the internal environmental performance and environmental investment of polluting enterprises have a restraining effect on stock price fluctuations.The more attention polluting enterprises pay to environmental protection,the more stable their stock price will be,and the lower the risk of stock price collapse will be;(3)the internal environmental performance of polluting enterprises has a more important impact than environmental investment.Environmental performance is reflected in all aspects that enterprises attach importance to environmental protection,and environmental investment,as a part that can be measured by money,should obviously be a part of environmental performance.Secondly,the degree of external concern for polluting enterprises has a significant impact on their stock price volatility.Among them,(1)for the stock price fluctuations have a significant impact on local environmental monitoring,enterprise local air quality is higher,the lower the degree of pollution,its share price volatility,the stability,due to air pollution is mainly caused by industrial pollution,air quality,the higher the mean local enterprise environment management more fully,produce positive effects on the stock price stability;(2)the degree of attention from the institutional media has a significant impact on the stock price fluctuations.The more frequently the enterprises are reported by the news media,the more frequently they are studied by the research institutions;(3)external audit concerns have a significant impact on stock price fluctuations.The higher the audit costs and the higher the firm specifications(i.e.the "big four" accounting firms),the more complete and accurate the information of polluting enterprises will be reflected in the annual report,and the smaller the stock price fluctuations.Finally,when internal environmental governance is combined with external environmental supervision,it has a significant impact on the stock price volatility of polluting enterprises,among which internal environmental governance has a more significant impact on stock price volatility,indicating that self-management constraints within enterprises for environmental problems are more critical to the stability of their stock prices.Therefore,enterprises that are prone to environmental pollution should take environmental protection as the top priority of sustainable operation and development.When enterprises take the road of green development,they will get better results from the capital market.Specific Suggestions for polluting enterprises are as follows:(1)Focus on the internal environmental performance of enterprises,from enterprise spirit to environmental investment,implement the concept of green and environmental protection development from the inside out,formulate environmental protection measures,disclose environmental protection measures and punished information,and continue to invest in the environmental protection industry chain.The capital market will rationally reflect the environmental protection contribution made by enterprises.(2)Timely disclose the specific environmental protection implementation of the enterprise to the media and research institutions,so that the public can clearly know the environmental protection investment of the enterprise.The more transparent the environmental protection measures of the enterprise,the more perfect the environmental protection measures,the smaller the fluctuation of its stock price,and the capital market will eventually confirm its investment.(3)Environmental cooperation mechanisms should be established among polluters based on the region,so as to jointly maintain the good local environment.The regional environment is protected by the efforts of all local enterprises.