The impact of carbon disclosure mandates on emissions and financial operating performance

By Benedikt Downar, J. Ernstberger, Stefan Reichelstein, Sebastian Schwenen, A. Zaklan. Review of accounting studies, 2020

306 citations recorded by the source corpus.

We examine the impact of a disclosure mandate for greenhouse gas emissions on firms’ subsequent emission levels and financial operating performance. For UK-incorporated listed firms a carbon disclosure mandate was adopted in 2013. Our difference-in-differences design shows that firms affected by the mandate reduced their emissions by about 8% relative to a control group of European firms. At the same time, our tests indicate that the treated firms experienced no significant changes in their gross margins. Taken together, our findings indicate that the reporting mandate had a real effect on the variable to be disclosed without adversely affecting the financial operating performance of the treated firms.

Subfields: Accounting, Marketing, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/ed683380ae21e228307d0e8d62f25cdd22ee5917

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Citations in the corpus

Mandatory CSR and sustainability reporting: economic analysis and literature review (2019, background): “Jouvenot and Krueger (2020), Downar et al. (2021), and Grewal (2021) examine whether this U.K. disclosure mandate creates stakeholder pressure for firms to subsequently reduce their GHG emissions.”