How Firms Respond to Mandatory Information Disclosure

Anil R. Doshi (), Glen W.S. Dowell () and Michael Toffel
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Anil R. Doshi: Harvard Business School
Glen W.S. Dowell: Johnson School of Management, Cornell University

No 12-001, Harvard Business School Working Papers from Harvard Business School

Abstract: Mandatory information disclosure regulations seek to create institutional pressure to spur performance improvement. By examining how organizational characteristics moderate establishments' responses to a prominent environmental information disclosure program, we provide among the first empirical evidence characterizing heterogeneous responses by those mandated to disclose information. We find particularly rapid improvement among establishments located close to their headquarters and among establishments with proximate siblings, especially when the proximate siblings are in the same industry. Large establishments improve more slowly than small establishments in sparse regions, but both groups improve similarly in dense regions, suggesting that density mitigates the power of large establishments to resist institutional pressures. Finally, privately held firms' establishments outperform those owned by public firms. We highlight implications for institutional theory, managers, and policymakers.

Keywords: information disclosure; institutional theory; environmental strategy; mandatory disclosure; environmental performance. (search for similar items in EconPapers)
Pages: 53 pages
Date: 2011-07, Revised 2012-06
New Economics Papers: this item is included in nep-bec and nep-cta
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Citations: View citations in EconPapers (12)

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