Research On Environmental System,environmental Information Disclosure And Cost Of Equity Capital

Environment is the basis for our survival.However with the rapid economy development of our country,environmental problems are becoming increasingly prominent.Many environmental pollution and ecological damage incidents occur frequently in enterprises.In order to supervise the environmental problems of enterprises,the relevant departments have promulgated many laws and regulations to urge enterprises to assume social responsibility for the environment and to disclose environmental information.At the same time,many enterprises are beginning to realize that initiatively disclose environmental information can bring certain economic value.In recent years,most of the studies on environmental information disclosure in our country only focus on influencing factors or economic effects.Therefore,this paper combines the three to study their linkage.First of all,this paper analysis the relationship among environmental system,environmental information disclosure and cost of equity capital from a theoretical point of view based on the theory of organizational legitimacy and principal-agent theory,etc.The estimation method of simultaneous equation model is also sorted out.Secondly,This paper constructs the environmental system and environmental information disclosure according to the content analysis method.It empirically studies the interconnection among environmental system,environmental information disclosure and the cost of equity capital by using 2SLS and 3SLS to establish a simultaneous equation model,which is based on the data of Listed Companies in heavy polluting industries in Shanghai and Shenzhen from 2012 to 2016.The research finds that the improvement of environmental information disclosure quality of Listed Companies in heavy pollution industry is helpful to reduce the cost of equity capital.Undisclosed firms can have a more significant impact.The establishment of stricter environmental system in the current period will reduce the level of enterprise environmental information disclosure,but the establishment of earlier environmental system can have a long-term impact on promoting enterprise environmental information disclosure.Meanwhile the environmental information disclosure of heavily polluted enterprises is conducive to the improvement of environmental system.Therefore,this paper suggests that the relevant institutions should improve the environmental system according to the specific industry conditions;at the same time,enterprises should be aware of the economic value of environmental information disclosure and take the initiative to carry out environmental information disclosure;strengthen the environmental risk education for investors so that the cost of equity capital of enterprises can be correctly assessed to achieve a virtuous circle.