An Empirical Study On The Effect Of Marketization Process,Political Connection To The Environmental Information Disclosure

We always need to focus on the relationship between market, government and enterprises in economic development and reforming process. This is a major problem in economic life. Government and the public are gradually transforming from the simple pursuit of economic growth rate into sustainable economic development, and pay more attention to the environmental problems. So far, there are many problems in China’s economic development:Domestic market mechanism is not perfect, Market is not entirely developed, and marketization processes are obviously different in various regions. The marketization process will affect the companies’decision-making behavior. It will also affect corporate environmental disclosure decisions. How will the companies in different market areas disclose their environmental information? This is what we want to discuss in the article.Political connections are ubiquitous in the markets of different countries. Companies are interested in building political association, because the companies which have political connections usually can get more political resources. Companies with more political resources can do things other ones can’t do, and create a better living environment. Political association can influence corporate behaviors, and what impact will it cast on corporate environmental information disclosure? We also hope to explore in the paper. In other studies, when market conditions are bad and the companies are facing resource constraints and risks, they tend to look for alternative mechanisms for protection. As political association is a kind of informal system, in many cases, it plays the role of alternative non-formal mechanisms. These important qualities of political association will protect companies in the system when it is imperfect, and guarantee the accesses to critical business resources. Political association will build a better survival environment for enterprises. So, we also want to investigate that in the corporate environmental information disclosure, whether there is such "alternative" relationship between marketization process and political connection.In order to study these issues, this paper chose641listed companies in heavily polluting industries of2010-2012in Shanghai and Shenzhen stock markets for the study, totally1923samples. Paper established evaluation system to measure the article explained variable-Environmental Information Disclosure Index, then used theoretical analysis and empirical research method to do the research, and hope to solve the following problem:1、what is the relationship between the marketization process and environmental information disclosure and whether they have a positive correlation.2、Is there a positive correlation between Politics connection and corporate environmental information disclosure.In the Non-state-owned enterprises, what kind of relationship is there between the political connection and corporate environmental information disclosure?3、what influence will marketization process and political connection will have on corporate environmental information disclosure.The paper is divided into seven parts:1. The first chapter is an introduction of the research background, significance, the main content, and framework. Finally, the two innovations of this paper are described.2. The second chapter is literature review. First, it has done a review of political association. It summarizes the literatures in the following perspectives: the universality of the political association, the influence of the political association to the corporate behavior, the impact on the enterprise value of political association, and the influence of the political connection to the environmental protection. Then, it did the literature review on environmental information disclosure, and summarizes the literatures in the following perspectives:in the domestic and foreign market, the relationship between company’s financial condition and corporate environmental information disclosure, the relationship between corporate governance and corporate environmental disclosure, the relationship between external factors and corporate environmental information disclosure. Finally, the paper did a review of marketization process, describing the researches of marketization process and the quality of accounting information. After the review the paper propose what we can learn from this article.The third chapter is the concept and basic theory of the paper. It describes the definition of political association, the forms of political association, seeking theory, signaling theory, and relationship capital theory. Then, it describes the concepts of environmental information disclosure, sustainable development theory, stakeholder theory, legitimacy theory.The fourth chapter describes the status quo of marketization process, political association and environmental information disclosure. The process of marketization generally showed the following trends:1、The current level of the marketization is still relatively low.2、The marketization process in different regions are not balanced.3-. From the development trend, market-oriented processes in different regions have the overall upward trend. Analyzing the status quo of political association, we can see that:In China’s market, companies associated with politics has become a common trend. Analyzing the status quo of the environmental information disclosure, we can see that:1、in the heavily polluting industries, listed companies prefer to disclose environmental information in their annual reports, social responsibility report,rather than publishing independent environmental responsibility report.2、in the heavily polluting industries, there are more companies publishing CSR reports and less companies publishing environmental responsibility report.3、in the heavily polluting industries, corporate environmental information disclosure situation is basically getting better year by year.The fifth chapter is the design of the empirical study. It proposed hypothesis of this paper:1、in the listed companies of the heavily polluting industries, there is a positive correlation between marketization process and the quality of environmental information disclosure.2、in the listed companies of the heavily polluting industries, there is a positive correlation between political association and the quality of environmental information disclosure.2.1、in the non-state-owned listed companies of the heavily polluting industries, there is a positive correlation between the political association and the quality of environmental information disclosure3、Marketization process and political association are alternative. In the low market process areas, listed companies with political association will have higher quality of the environmental information disclosure than those with no political association, and in the high market process areas, listed companies with political association will have lower quality of the environmental information disclosure than those with non. Also, it describes the sample data used in the text, the definition of the variables, sample selection, data sources, and research models.The sixth chapter is the part of empirical results and analysis. It did the descriptive analysis and correlation analysis, then did the regression, and find out that:1、marketization process and environmental information disclosure are significantly positively correlated at the1% level.2、political association and environmental information disclosure are significantly positively correlated at the1% level.3、in the non-state-owned listed companies, political association and environmental information disclosure are significantly positively correlated.4、 Marketization process and political association are alternative in environmental information disclosure:when there is no political association, the marketization process plays a more important role in the company’s environmental information disclosure; when there is political association, the marketization process plays a less important role in the company’s environmental information disclosure.The seventh chapter is the part of conclusions and recommendations. Papers propose the conclusion in two aspects. Firstly, in the theory aspects:Community’s pursuit for sustainable development promotes companies’environmental information disclosure. Secondly, in the empirical analysis aspects:1、when the market environment is good, the listed companies will have better environmental information disclosure.2、in china’s market, from the overall level, listed companies with political association will have better environmental information disclosure.3、in the non-state-owned listed companies, companies with political association will have better environmental information disclosure.4、Marketization process and political association are alternative in environmental information disclosure. Then make recommendations:1、Improving environmental protection, establishing environmental liability regime.2、government should take measures to ensure the implementation of rules and norms in environmental information disclosure.3、promoting economic development, economic reform, strengthening the construction market.4、strengthening the supervision of enterprises with political association,and influence other companies on the market. Finally, this paper describes the limitations and future research directions.This paper mainly has two contributions:1、New research methods:Paper builds its own evaluation system for environmental information disclosure index, referring to "Open Environmental Information (Trial)","Shanghai Stock Exchange listed company Environmental Information Disclosure Guidelines","Environmental Information Disclosure of Listed Companies Guide (draft)" and so on. This article has divided the evaluation criteria of environmental information disclosure into20items. Then these20projects have been further subdivided into the group of qualitative evaluation and the group of qualitative-and-quantitative evaluation. The one in the qualitative evaluation group will be evaluated by its qualitative information. The one in the qualitative-and-quantitative evaluation group will be evaluated by its qualitative and quantitative information. All of these are striving to ensure the accuracy of environmental information disclosure quality evaluation results.2、New perspective:Domestic and foreign studies on affecting factors of environmental information disclosure are mainly focus on company financial indicator, governance structure et. There are no studies on the influence of marketization process and political association to the environmental information disclosure. Some scholars have studied the impact of the political relevance to corporate social responsibility information disclosure, but there are not too many literatures. This article is the first one to add the marketization process in the study of the influence of political association to the environmental information disclosure. Also it discuss of the marketization process and political association’s joint influence to the environmental information disclosure. The research ideas are new and can supplement the studies of political association.