Study On The Correlation Of The Environmental Accounting Information Disclosure And Enterprise Value

With the increasing impacts of the enterprises on environment, all sectors of society have been paying more attention to corporations’environmental footprint. The companies usually communicate with outside world through kinds of information disclosures, and their environmental conditions pass out through their environmental accounting information disclosures, and according to them the public and the market can evaluate a company’s eco-efficiency and environmental performance. In terms of macro-management point of view, or from the angle of investors who want to reduce the asymmetry of information, as well as other stakeholders’concern about the living environment, all of them hope the companies’ environmental footprint more transparent, which requires companies to disclose their environmental information as much and complete as possible. Most enterprises exist for financial gain with the goal of value maximization, and they choose the schemes which can enhance their value. So this paper tries to discuss the relativity between the environmental accounting information disclosure and enterprise value, especially the listed corporation on the monitoring list which faced more regulatory and concern, so that we can provide theory support for enterprise to disclose environmental accounting information more actively.This paper take a combination of quantitative and qualitative research methods, including literature review method, econometric methods, the event study method, etc. Reading a lot of related literature, I cleared up the two paths of effects on corporate value and stock market performance from the environmental accounting information disclosure, studied the impact of disclosure on the corporate value pro and con. On the one hand, with the sample of the listed companies on the monitoring list, according to the requirements of the current regulatory system, this paper designs a standard to evaluate the companies’disclosure conditions and scores them, so we can get the results through statistical regression analysis; meanwhile, based on the free cash flow model, this paper decomposes corporate value into factors of expected cash flows and capital cost, and analyses the impact process and path of environmental accounting information disclosure on corporate value. On the other hand, this paper using the event analysis, studies the stock market reaction to environmental events which were disclosed passively during the period of study, resulting in a conclusion that passive environment will detract from the value of the companyThis article includes the following six parts:The first part explains the background and significance of the research, introduces research methods and ideas, and pointed out the deficiencies and innovation of this paper.The second part, based on the study of literature, analyzes current research situation of environmental accounting information disclosure from various angles, including the disclosures’content, modes, influencing factors, value relevance and impact on finance, to clarify the research at home and abroad.The third part define the concepts of this study, introduces the concept of environmental accounting information disclosure and corporate value, and summarizes the relevant theoretical basis, including the theory of information asymmetry, signaling theory, principal-agent theory, the stakeholder theory, sustainable development, efficient markets theory, etc. thus lays the foundation for further empirical research.The forth part introduces the design of empirical research in detail and thoroughly. First we put forward hypotheses by analyzing the impact path of environmental accounting information disclosure on enterprise value, that is there’s a positive correlation between environmental accounting information disclosure level and enterprise value, and this related relationship can realize with the help of expected cash flow and cost of equity capital. And passive environmental accounting information disclosure will reduce enterprise value, which main reflect on fluctuations of stock market. The second section describes the method and scope of sample selection, builds models and describes the variables in the model in detail to verify assumes.The fifth part, samples were analyzed with the statistical software. Descriptive statistics show that even for national key monitoring enterprises, the overall levels of disclosure of environmental accounting information is still not high. Results of regression analysis display that there’s a notable positive correlation between environment disclosure index(EDI) and enterprise value, so assumed1is confirmed; the further analysis indicates that environmental accounting information disclosure level has a significant positive correlation with the expected cash flow, but the relationship between the cost of equity capital and environmental accounting information disclosure has not been verified. We believe that this may be due to many factors such as China’s stock market environment, the character of environmental accounting information disclosure, tendency of investors and so on. The result of the later t test shows significant negative abnormal returns within the given period of time, which means the company’s stock performance will be negatively impact of passive disclosure of environmental information.The sixth part sums up the foregoing statistical results, obtains conclusions of this study, and gives recommendations.In this paper I think, good disclosure of environmental information can increase the enterprise value, and passive disclosure of negative information will derogate company value, but there is no uniform standard of evaluation, so some evaluation system can’t play a role normally. As a result, our government should establish and normalize disclosure standards to create a good legal environment and market environment; companies themselves also should coordinate with the government to establish a perfect daily disclosure mechanism, as well as regulate the disclosure form and content.