Category FAQs Search : Carbon Footprint
Question: Corporate voluntary carbon disclosure strategy and carbon performance in the USA
Answer: Purpose
This study aims to examine whether good carbon performers disclose more carbon information overall than poor performers, and if yes, how firms select different types of carbon information to signal their genuine superior carbon performance.
Design/methodology/approach
The level of disclosure is measured based on content analysis of Carbon Disclosure Project (CDP) reports. The study sample consists of 487 US companies that voluntarily participated in the CDP survey from 2011 to 2012. The authors use the t-test and multiple regression models for analyses.
Findings
The results consistently indicate that firms with better carbon performance disclose a greater amount of overall carbon information, supporting the signalling theory. In addition, in contrast to previous studies that merely consider the overall disclosure level, the authors also investigate disclosure of each major aspect of carbon activities. The results show that good carbon performers disclose more key carbon items, such as goods and services that avoid greenhouse gas (GHG) emissions, external verification and carbon accounting, to signal their true type.
Research limitations/implications
This study has some limitations. The authors rely on CDP reports for analysis and focus on the largest companies in the USA. Caution should be exercised when generalising the results to other countries, smaller firms or voluntary carbon information disclosed in other communications channels.
Practical implications
Because carbon disclosure has already been moving from a voluntary to mandatory requirement in many jurisdictions, the format and content of CDP reports might be considered for a formal standalone GHG statement. Based on the results, the authors believe that there should be industry-specific disclosure guidelines, and more disclosure should be made at the project level.
Originality/value
In the context of climate change, this study provides support for the signalling theory by utilising the relationship between voluntary carbon disclosure and performance. The study also provides empirical evidence on how companies may use different types of carbon information to signal their underlying carbon performance.
(Source: , 25 Aug 2021)
Source Link: https://doi-org.onlinedatabase.librarynet.com.my/10.1108/ARJ-02-2017-0031