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The impact of environmental performance rating and disclosure: an empirical analysis of perceptions by polluting firms'managers in China

Author

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  • Jin, Yanhong
  • Wang, Hua
  • Wheeler, David

Abstract

Environmental performance rating and disclosure has emerged as a substitute or complement for traditional pollution regulation, especially in developing countries. Using data from China's Green Watch program, this study extends previous research on performance rating and disclosure by considering firms'perceptions of public and market responses to their ratings. The results suggest that the Green Watch has significantly increased market and stakeholder pressures on managers to improve their firms’ environmental performance. More specifically, controlling for the characteristics of locations, firms, and individual managers, the analysis finds that firms with better ratings perceive positive impacts on market competitiveness, overall market value, and relationships with different stakeholders, while the firms with bad ratings are more likely to perceive deterioration. Among these factors, managers perceive a more active role for markets than for stakeholder relations.

Suggested Citation

  • Jin, Yanhong & Wang, Hua & Wheeler, David, 2010. "The impact of environmental performance rating and disclosure: an empirical analysis of perceptions by polluting firms'managers in China," Policy Research Working Paper Series 5419, The World Bank.
  • Handle: RePEc:wbk:wbrwps:5419
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    References listed on IDEAS

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    Cited by:

    1. Gozun, Elisea G. & Laplante, Benoit & Wang, Hua, 2011. "Design and implementation of environmental performance rating and public disclosure programs : a summary of issues and recommendations based on experiences in East Asian countries," Policy Research Working Paper Series 5551, The World Bank.

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    Keywords

    Markets and Market Access; Microfinance; Water and Industry; Brown Issues and Health; Green Issues;

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