On the Obligation to Provide Environmental Information in the 21st Century – Empirical Evidence from Germany
In this paper, we study the effectiveness of environmental information disclosure as a regulatory instrument. In particular we analyze its impact when environmental regulation is already advanced. Using German stock market data, we are able to identify the impact of the European Pollutant Emission Register (EPER) on the market value of listed firms using a Multivariate Regression Model (MVRM). First, we show that the publication of EPER data leads to negative abnormal returns of the respective listed firms in Germany. Second, we study drivers of these abnormal returns. Here, we find that the firms' individual level of non-carbon emissions can explain the observed changes in market valuation, while carbon dioxide emissions do not seem to be punished by the market. Moreover, we include information on voluntarily provided environmental reports and find that these reports can serve as a substitute to the obligatory register.
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| Date of creation: | 09 Mar 2012 |
| Handle: | RePEc:awi:wpaper:0524 |
| Note: | This paper is part of http://archiv.ub.uni-heidelberg.de/volltextserver/view/schriftenreihen/sr-3.html |
| Contact details of provider: | Postal: Grabengasse 14, D-69117 Heidelberg Phone: +49-6221-54 2905 Fax: +49-6221-54 2914 Web page: http://www.awi.uni-heidelberg.de/ Email: More information through EDIRC
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References listed on IDEAS
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- Konar, Shameek & Cohen, Mark A., 1997. "Information As Regulation: The Effect of Community Right to Know Laws on Toxic Emissions," Journal of Environmental Economics and Management, Elsevier, vol. 32(1), pages 109-124, January.
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- Blackman, Allen & Afsah, Shakeb & Ratunanda, Damayanti, 2000. "How Do Public Disclosure Pollution Control Programs Work? Evidence from Indonesia," Discussion Papers dp-00-44, Resources For the Future.
- Hamilton James T., 1995. "Pollution as News: Media and Stock Market Reactions to the Toxics Release Inventory Data," Journal of Environmental Economics and Management, Elsevier, vol. 28(1), pages 98-113, January.
- Akira Hibiki & Shunsuke Managi, 2010. "Environmental Information Provision, Market Valuation, and Firm Incentives: An Empirical Study of the Japanese PRTR System," Land Economics, University of Wisconsin Press, vol. 86(2), pages 382-393.
- Tom Tietenberg, 1998. "Disclosure Strategies for Pollution Control," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 11(3), pages 587-602, April.
- Khanna, Madhu & Quimio, Wilma Rose H. & Bojilova, Dora, 1998. "Toxics Release Information: A Policy Tool for Environmental Protection," Journal of Environmental Economics and Management, Elsevier, vol. 36(3), pages 243-266, November.
- Cañón-de-Francia, Joaquín & Garcés-Ayerbe, Concepción & Ramírez-Alesón, Marisa, 2008. "Analysis of the effectiveness of the first European Pollutant Emission Register (EPER)," Ecological Economics, Elsevier, vol. 67(1), pages 83-92, August.
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