An Empirical Research On The Effect That Regulatory Environment And Equity Incentive In The Environmental Disclosure

With the rapid development of China’s economic, it has also produced a lot ofproblems, environmental problems can not be ignored anymore. As time progresses,people’s environmental awareness continue to strengthen. The awareness of thedangers of environmental pollution are increasing. However, environmentalaccounting of listed companies in China is still in its initial stage, and we have to takeefforts to improve environmental accounting disclosure both in frame and content. Inrecent years, the public pay more and more attention on environmental issues. Asthe information age is developing rapidly, environmental issues have a greater impacton the public, public pressure on the enterprise inevitably bring immeasurable impact.The separation of ownership and management has become a very prominent feature inthe Modern Enterprise System. In general, most investors do not take part in corporategovernance, as an agent of the company, the management control the company’sactual business activities, and be responsible for the first few large shareholders.So in this process, what kind of impact that social media monitoring, supervisionof local governments as well as equity incentive policies on corporate environmentalinformation disclosure will produce? What role they took play? These questions led tothe author further reflection about the corporate environmental information disclosure.Based on China’s basic national conditions and the basic status of environmentalinformation disclosure, this paper studied the the impacts of the external regulatoryenvironment, equity incentives and the both interaction of the environment disclosure.Based on sorting the previous study both domestic and overseas, throughtheoretical analysis and deduction, this paper put forward four hypotheses to be tested,made listed companies in China of A shares between2011and2012as the researchsample and the sample according to certain criteria to be selected.This paper examineswhether the external regulatory environment, equity incentives affects companies’environment disclosure. The empirical results show that: the tendency of the mediareport has an impact on corporate environmental information disclosure. And localgovernment’s supervision and management on corporate environmental informationdisclosure also enhance the level of information disclosure. They support thehypothesis one and two of this paper. For the study of the equity incentive and environmental information disclosure, we found that managerial stockholding has apositive impact on raising the level of environmental disclosure. And this support thehypothesis three. According to the agency theory, the greater companies face externalregulatory pressure, the more investors are willing to give managerial stockholding,which allows the management to focus long-term development, the more disclosureof corporate environmental information. Government regulation variables, the mediareported have strengthened the relationship between the equity incentive andcorporate environmental information. This support the hypotheses four.This paper studied the impact of external regulatory environment. They includethe impact of social regulation and government regulation. The research provides newperspectives and evidence in the relevant study, and the basis for environmentalinformation disclosure’s non-economic motives. In addition, the external regulatoryenvironment and equity incentive’s interaction strengthen the equity incentive’simpact on environmental information disclosure. Through this article research results,we hope that we can provide an effective way to make decision for all stakeholders.