IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

The Informational Contribution of Social and Environmental Disclosures for Investors

  • Denis Cormier

    (Université du Québec - Université du Québec - Université du Québec)

  • Marie-Josée Ledoux

    (Université du Québec - Université du Québec - Université du Québec)

  • Michel Magnan

    (Université Concordia - Université Concordia)

Corporations increasingly define their social and environmental initiatives and activities as part of their Corporate Social Responsibility (CSR). Disclosure practices have followed suit as well with social and environmental information typically being combined, often through a CSR report. The emergence of CSR is a response to the demands of activist investors, ethical and green institutional investors as well as rating services (e.g., Jantzi) which evaluate corporations through the lens of CSR, thus going beyond traditional environmental indicators. However, is this trend beneficial to investors? We investigate whether social disclosure and environmental disclosure substitute or complement each other in reducing information asymmetry between managers and investors, taking into account a firm‟s environmental performance and governance attributes. Our findings suggest that social disclosure and environmental disclosure substitute each other in reducing stock market asymmetry, as proxied by share price volatility. Our results also show that the reduction in share price volatility is higher for economic (hard) environmental disclosure than for generic (soft) environmental disclosure. Hence, future research in CSR disclosure may fruitfully distinguish between social and environmental disclosures as well as between hard (economic-based) and soft environmental information.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://hal.archives-ouvertes.fr/docs/00/48/15/71/PDF/p211.pdf
Download Restriction: no

Paper provided by HAL in its series Post-Print with number hal-00481571.

as
in new window

Length:
Date of creation: 2010
Date of revision:
Publication status: Published - Presented, Crises et nouvelles problématiques de la Valeur, 2010, Nice, France
Handle: RePEc:hal:journl:hal-00481571
Note: View the original document on HAL open archive server: http://hal.archives-ouvertes.fr/hal-00481571/en/
Contact details of provider: Web page: http://hal.archives-ouvertes.fr/

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Luzi Hail & Christian Leuz, 2006. "International Differences in the Cost of Equity Capital: Do Legal Institutions and Securities Regulation Matter?," Journal of Accounting Research, Wiley Blackwell, vol. 44(3), pages 485-531, 06.
  2. Scott Shane & Daniel Cable, 2002. "Network Ties, Reputation, and the Financing of New Ventures," Management Science, INFORMS, vol. 48(3), pages 364-381, March.
  3. Bushman, Robert & Chen, Qi & Engel, Ellen & Smith, Abbie, 2004. "Financial accounting information, organizational complexity and corporate governance systems," Journal of Accounting and Economics, Elsevier, vol. 37(2), pages 167-201, June.
  4. Clarkson, Peter M. & Li, Yue & Richardson, Gordon D. & Vasvari, Florin P., 2008. "Revisiting the relation between environmental performance and environmental disclosure: An empirical analysis," Accounting, Organizations and Society, Elsevier, vol. 33(4-5), pages 303-327.
  5. David Pastoriza & Miguel Ariño & Joan Ricart, 2008. "Ethical Managerial Behaviour as an Antecedent of Organizational Social Capital," Journal of Business Ethics, Springer, vol. 78(3), pages 329-341, March.
  6. Cormier, Denis & Magnan, Michel, 2007. "The revisited contribution of environmental reporting to investors' valuation of a firm's earnings: An international perspective," Ecological Economics, Elsevier, vol. 62(3-4), pages 613-626, May.
  7. Cormier, Denis & Magnan, Michel, 2003. "Environmental reporting management: a continental European perspective," Journal of Accounting and Public Policy, Elsevier, vol. 22(1), pages 43-62.
  8. Eng, L. L. & Mak, Y. T., 2003. "Corporate governance and voluntary disclosure," Journal of Accounting and Public Policy, Elsevier, vol. 22(4), pages 325-345.
  9. Walter Aerts & Denis Cormier & Michel Magnan, 2007. "The Association Between Web-Based Corporate Performance Disclosure and Financial Analyst Behaviour Under Different Governance Regimes," Corporate Governance: An International Review, Wiley Blackwell, vol. 15(6), pages 1301-1329, November.
  10. Abagail McWilliams & Donald S. Siegel & Patrick M. Wright, 2006. "Corporate Social Responsibility: Strategic Implications," Journal of Management Studies, Wiley Blackwell, vol. 43(1), pages 1-18, 01.
  11. Aerts, Walter & Cormier, Denis, 2009. "Media legitimacy and corporate environmental communication," Accounting, Organizations and Society, Elsevier, vol. 34(1), pages 1-27, January.
  12. Vafeas, Nikos, 1999. "Board meeting frequency and firm performance," Journal of Financial Economics, Elsevier, vol. 53(1), pages 113-142, July.
  13. Lenzen, Manfred & Dey, Christopher J. & Murray, Shauna A., 2004. "Historical accountability and cumulative impacts: the treatment of time in corporate sustainability reporting," Ecological Economics, Elsevier, vol. 51(3-4), pages 237-250, December.
  14. Darren T. Roulstone, 2003. "The Relation Between Insider-Trading Restrictions and Executive Compensation," Journal of Accounting Research, Wiley Blackwell, vol. 41(3), pages 525-551, 06.
  15. Williams, S. Mitchell & Ho Wern Pei, Carol-Anne, 1999. "Corporate social disclosures by listed companies on their web sites: an international comparison," The International Journal of Accounting, Elsevier, vol. 34(3), pages 389-419, 08.
  16. Aerts, Walter & Cormier, Denis & Magnan, Michel, 2008. "Corporate environmental disclosure, financial markets and the media: An international perspective," Ecological Economics, Elsevier, vol. 64(3), pages 643-659, January.
  17. Neu, D. & Warsame, H. & Pedwell, K., 1998. "Managing public impressions: environmental disclosures in annual reports," Accounting, Organizations and Society, Elsevier, vol. 23(3), pages 265-282, April.
  18. Wiseman, Joanne, 1982. "An evaluation of environmental disclosures made in corporate annual reports," Accounting, Organizations and Society, Elsevier, vol. 7(1), pages 53-63, January.
  19. Ziegler, Andreas & Schröder, Michael, 2010. "What determines the inclusion in a sustainability stock index?: A panel data analysis for european firms," Ecological Economics, Elsevier, vol. 69(4), pages 848-856, February.
  20. Al-Tuwaijri, Sulaiman A. & Christensen, Theodore E. & Hughes, K. II, 2004. "The relations among environmental disclosure, environmental performance, and economic performance: a simultaneous equations approach," Accounting, Organizations and Society, Elsevier, vol. 29(5-6), pages 447-471.
  21. repec:cup:cbooks:9780521117562 is not listed on IDEAS
  22. Barbara Pirchegger & Alfred Wagenhofer, 1999. "Financial information on the Internet: a survey of the homepages of Austrian companies," European Accounting Review, Taylor & Francis Journals, vol. 8(2), pages 383-395.
  23. Roberts, Robin W., 1992. "Determinants of corporate social responsibility disclosure: An application of stakeholder theory," Accounting, Organizations and Society, Elsevier, vol. 17(6), pages 595-612, August.
  24. Chung, Kee H. & Jo, Hoje, 1996. "The Impact of Security Analysts' Monitoring and Marketing Functions on the Market Value of Firms," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 31(04), pages 493-512, December.
  25. Christian Leuz, 2003. "IAS Versus U.S. GAAP: Information Asymmetry-Based Evidence from Germany's New Market," Journal of Accounting Research, Wiley Blackwell, vol. 41(3), pages 445-472, 06.
  26. Robert E. Verrecchia & Christian Leuz, 1999. "The Economic Consequences of Increased Disclosure," Working Paper Series: Finance and Accounting 41, Department of Finance, Goethe University Frankfurt am Main.
  27. Ali Fekrat, M. & Inclan, Carla & Petroni, David, 1996. "Corporate environmental disclosures: Competitive disclosure hypothesis using 1991 annual report data," The International Journal of Accounting, Elsevier, vol. 31(2), pages 175-195.
  28. Patten, Dennis M., 1991. "Exposure, legitimacy, and social disclosure," Journal of Accounting and Public Policy, Elsevier, vol. 10(4), pages 297-308.
  29. Mills, Dixie L. & Gardner, Mona J., 1984. "Financial profiles and the disclosure of expenditures for socially responsible purposes," Journal of Business Research, Elsevier, vol. 12(4), pages 407-424, December.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:hal:journl:hal-00481571. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (CCSD)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.