Carbon disclosure and firm risk: evidence from the UK corporate responses to climate change

Khaled Alsaifi (), Marwa Elnahass (), Abdullah M. Al-Awadhi () and Aly Salama ()
Additional contact information
Khaled Alsaifi: College of Business Studies, Public Authority for Applied Education and Training (PAAET)
Marwa Elnahass: Newcastle University Business School, Newcastle University
Abdullah M. Al-Awadhi: College of Business Studies, Public Authority for Applied Education and Training (PAAET)
Aly Salama: Northumbria University

Eurasian Business Review, 2022, vol. 12, issue 3, No 4, 505-526

Abstract: Abstract By considering the theoretical association between corporate transparency, information asymmetry and firm risk, this paper investigates the relationship between corporate carbon disclosure and firm risk in the UK context. Using a sample of FTSE350 firms with Carbon Disclosure Project based year-observations from 2007 to 2015, we find that enhanced voluntary carbon disclosure reduces a firm’s total, systematic, and idiosyncratic risks. We also find that this negative association is driven mainly by carbon-intensive industries. Additional tests show that carbon disclosure was not a significant determinant of a firm’s risk until after the global financial crisis of 2007–2008. Our findings are of interest to stakeholders, including business managers and investors as they have considerable interest in assessing firms’ survival and sustainability.

Keywords: Firm risk; Carbon disclosure; Sustainability; Carbon disclosure project (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://link.springer.com/10.1007/s40821-021-00190-0 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:eurasi:v:12:y:2022:i:3:d:10.1007_s40821-021-00190-0

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/40821

DOI: 10.1007/s40821-021-00190-0

Access Statistics for this article

Eurasian Business Review is currently edited by Marco Vivarelli

More articles in Eurasian Business Review from Springer, Eurasia Business and Economics Society Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().