Does national carbon pricing policy affect voluntary environmental disclosures? A global evidence
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Does national carbon pricing policy affect voluntary environmental disclosures? A global evidence Mumtaheena Anwar1 · Sohanur Rahman2 · Md. Nurul Kabir3 Received: 21 March 2020 / Accepted: 19 September 2020 © Society for Environmental Economics and Policy Studies and Springer Japan KK, part of Springer Nature 2020
Abstract This paper examines the relationship between institutional pressure of national carbon pricing policy and the voluntary environmental disclosures (VED) of electricity-generating firms. Using a sample of 103 firms from forty-four countries for 2015–2017, we find that the implementation of carbon pricing policies at the national level increases the VED quantity significantly. Put differently, firms located in the carbon pricing countries disclose more environmental information than those in non-carbon pricing countries. Besides, we also provide evidence that firms adopting internal carbon reduction strategies disclose more information than firms with no carbon reduction strategies. Overall, our findings are consistent with the view of the coercive isomorphism branch of the institutional theory that the government’s policy for one aspect of environmental issues (i.e., emissions reduction) may have a pervasive indirect impact on the other environmental aspects (i.e., VED) of the organizations. Keywords Carbon pricing · Emission reduction · Electricity-generating firms · Voluntary environmental disclosures (VED) JEL Classification M41 · M48 · K3 · Q56 · Q58
* Sohanur Rahman [email protected] Mumtaheena Anwar [email protected] Md. Nurul Kabir [email protected] 1
Faculty of Business Administration, Eastern University, Dhaka, Bangladesh
2
School of Accountancy, QUT Business School, Queensland University of Technology, Brisbane, Australia
3
Department of Accounting and Finance, North South University, Dhaka, Bangladesh
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Environmental Economics and Policy Studies
1 Introduction Global climate change and its destructive consequences have become a significant concern for the international community. Since 2001, sixteen of the seventeen warmest years of all time have been recorded, with 2016 being the warmest year ever.1 Global industrial emissions are held widely responsible for this environmental disaster. The Intergovernmental Panel on Climate Change (IPCC) reveals in its 2014′s report that the electricity-generating industry alone is liable for more than 50% of global Greenhouse gas (GHG) emissions (IPCC 2014). As concern grows over the role of human-induced GHG in climate change across the world, high emitting business firms, such as electricity-generating firms, are brought under direct and indirect pressure from regulators and policymakers. Of the various measurements taken by the government or regulatory bodies to reduce the carbon emissions, carbon pricing is a significant one. Prior literature shows that carbon pricing, either Carbon Tax2 or Emissions Trading Scheme (ETS),3 is a useful instrument to curb industrial GHG or carbon e
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