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Carbon Disclosure Effect, Corporate Fundamentals, and Net-zero Emission Target: Evidence from China

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Listed:
  • Xiyuan Zhou
  • Xinlei Wang
  • Xiang Fei
  • Wenxuan Liu
  • Bai-Chen Xie
  • Junhua Zhao

Abstract

In response to China's national carbon neutrality goals, this study examines how corporate carbon emissions disclosure affects the financial performance of Chinese A-share listed companies. Leveraging artificial intelligence tools, including natural language processing, we analyzed emissions disclosures for 4,336 companies from 2017 to 2022. The research demonstrates that high-quality carbon disclosure positively impacts financial performance with higher stock returns, improved return on equity, increased Tobin's Q ratio, and reduced stock price volatility. Our findings underscore the emerging importance of carbon transparency in financial markets, highlighting how environmental reporting can serve as a strategic mechanism to create corporate value and adapt to climate change.

Suggested Citation

  • Xiyuan Zhou & Xinlei Wang & Xiang Fei & Wenxuan Liu & Bai-Chen Xie & Junhua Zhao, 2025. "Carbon Disclosure Effect, Corporate Fundamentals, and Net-zero Emission Target: Evidence from China," Papers 2508.17423, arXiv.org.
    • Handle: RePEc:arx:papers:2508.17423
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