The Research Of Environmental Information Disclosure And Corporate Value

With the rising seriousness of environmental problem, the increasing degradation of environmental pollution and ecological damage, it isthe inevitable choice of the development of human society that protecting environment, maintaining ecological balance, pursueing the sustainable development path and realizeing the harmony between human and nature. Fulfilling enterprise’s environmental accountability and carrying out environmental information disclosure, which is one of the most effective means on environmental governance issues, in the international community. In that way, whether a company is willing to disclose environmental information? Does a company disclose environmental information fully? Can environmental information disclosure improve film value? These are confronted with in the theory and practice, in the Environmental Information Disclosure area. While it is the key to disclose environmental information for enterprise proactively, and make good useful of the governance mechanism of environmental information.Research on the association between enterprises, environmental information disclosure and firm value, which is significantly important for promoting enterprise to disclosure environmental information voluntarily and fully, and playing the governance-monitoring function of environmental information. This paper not only developed and deepened research field rewarding environmental information disclosure, but also expanded market response research on environmental information disclosure. This study examines the relationship between the quality of a firm’s environmental information disclosure and firm value, by exploring the correlation between the components of firm value--cost of capital and expected cash flows, and environmental information disclosure quality. Empirical research that directly examines the link between environmental information disclosure quality and firm value is limited. In this study, we try to break through the limitation. Simultaneously, this paper provides some advices for environmental information disclosure of listed companies normatively and adequately, and gives the references for government monitoring department to make relevant policies on environmental information disclosure. What’s more, it is helpful for enterprises to understand the market function of environmental information disclosure.Based on a large number of domestic and international research literature about environmental information disclosure, we trace back prior research. From the theory of asymmetric information, principal-agent theory, signaling theory, legitimacy theory, theory of sustainable development and so on, the paper expounds the theoretical basis of enterprises, environmental information disclosure, and analyzes the reaction mechanism between environmental information disclosure and firm value. On the basis of these, this paper constructed a basic theoretical model about the relationship between enterprises, environmental information disclosure and firm value, and deduced six verifiable hypotheses. The hypotheses are as follows: HYPOTHESIS la:The quality of environmental information disclosure is positively related to firm value:HYPOTHESIS1b:The quality of environmental information disclosure is negatively related to cost of equity capital. It suggests that environmental information disclosure is strictly effective, and the investment proportion of individual capital is relatively high, and vice versa; HYPOTHESIS1c:The quality of environmental information disclosure is positively related to expected cash flows; H YPOTHESIS2a:Environmental sensitivity in industry moderates the relationship between the quality of environmental information disclosure and firm value. HYPOTHESIS2b:The negative relationship between the quality of environmental information disclosure and cost of equity capital will be stronger for firms in environmentally sensitive industries. HYPOTHESIS2c:The positive relationship between the quality of environmental information disclosure and expected future cash flows will be stronger for firms in environmentally sensitive industries. In order to verify the hypothesis empirically, we select the sample about647listed companies from Shanghai Securities Exchange in China from2005to2009,3235valid data in total. The study examines separately the relationship between the quality of environmental information disclosure and firm value, the relationship between the quality of environmental information disclosure and cost of equity capital, and the relationship between the quality of environmental information disclosure and expected future cash flows. Finally, on the one hand,from the results of empirical test, we draw the conclusions of this paper. On the other hand, we point out its limitation, and put forward corresponding suggestions to improve the quality of enterprises, environmental information disclosure, for supervision agencies, enterprises, investors and so on.The results show that, enhancing the environmental information disclosure quality can improve firm value, and this facilitation mainly result from the increase of expected cash flow.However, it has little effect on reducing cost of enterprises, capital. Environmental sensitivity in industry moderates the relationship between the quality of environmental information disclosure and firm value. There is more significant positive relationship between the quality of environmental information disclosure and firm value, between the quality of environmental information disclosure and expected future cash flows, in environmental-sensitivity listed companies. No matter environmental sensitivity listed companies or non-environmental-sensitivity listed companies, the effect on reducing cost of enterprises, capital is not confirmed.We consider that the basic reason is effective divergence between commodity market and capital market in environmental conservation.