Academic journal article Canadian Social Science

An Empirical Study on Impacts of Environmental Regulation on Environmental Information Disclosure of Listed Companies of China: Based on Researches on Listed Companies in Nonferrous Metal Industry

Academic journal article Canadian Social Science

An Empirical Study on Impacts of Environmental Regulation on Environmental Information Disclosure of Listed Companies of China: Based on Researches on Listed Companies in Nonferrous Metal Industry

Article excerpt

Abstract

With rapid development of economy, environmental pollution becomes increasingly serious, which not only affects quality of our life but also threatens our living conditions. Since the 1990s, the percentage that Chinese listed companies' voluntary environmental information disclosure has increased to a larger extent and the content disclosed by many enterprises has gone beyond scope required by laws. Under this background, this paper combines with current status of environment information disclosure of Chinese listed companies, takes listed companies of non-ferrous metal industry in Shanghai and Shenzhen from 2006 to 2011 as samples, and studies impacts of environmental information disclosure system and environmental regulation intensity on environmental information disclosure. In addition, it carries out empirical tests on sample data of companies and implements robustness tests on regression results to exclude influence of differences between new and old criterion on comparability of accounting data. By virtue of positive analysis, it is found that corporate features like scale of company, financial risk, growth ability and profitability have great influence on environment information disclosure, and implementation of environment information disclosure and environmental regulation intensity have significant impacts on environment information disclosure.

Key words: Environment; Accounting; Information disclosure; System; Intensity of environmental regulation

INTRODUCTION

Since Reform and Opening-up, Chinese economy has greatly developed. However, pollution is getting worse and worse as industrialization proceeds continuously. In recent years, environmental pollution accidents have occurred frequently. Related leaders of Ministry of Environmental protection and experts from the field of environmental protection have indicated that "China is entering the period when environmental pollution accidents happen frequently" on many occasions. There have been many environmental pollution accidents, such as environmental protection accidents of listed companies like Zijin Mining and Zhongjin Linnan Nonfemet Company, oil leakage accidents of CNOOC and CNPC, and cadmium contamination in Longjiang, Guangxi Province. Besides, there are numerous small environmental pollution problems, which damage people's living environment. It is no doubt that environmental pollution accidents have serious influence on people's health, environment and social security. The environmental information disclosure of companies plays an important role in assisting the government in understanding status of enterprises' environmental protection, strengthening pollution control and establishing mutual trust between enterprises and the public. In 2003, State Environmental Protection Administration issued An Announcement on Environmental Information Disclosure of Companies (HF [2003] Doc# 156), which clearly specified that companies included in the list must periodically disclose environmental information, including enterprises' environmental policies, total amount of pollutant emission, environmental pollution control, environmental compliance and environmental management etc. In 2010, Ministry of Environmental Protection issued Guideline for Environmental Information Disclosure of Listed Companies (exposure draft), requiring listed companies in heavy-polluting industries should publish an annual environmental reports. Such reports should disclose information, such as business name, address and legal representative; names of major pollutants, discharge mode, emission concentration and total amount, exceeding standards, and situations beyond total amount; construction and operating situations of enterprises' environmentally protective facilities; and plans dealing with emergencies related to environmental pollution. In doing so, they aimed at encouraging companies to disclose resource consumption, reduce emissions and improve actions of resource efficiency and actual effect and decrease potential influence on global climate. …

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