Climate change disclosure and evolving institutional investor salience: Roles of the Principles for Responsible Investment

Kentaro Azuma and Akira Higashida

Business Strategy and the Environment, 2024, vol. 33, issue 4, 3669-3686

Abstract: This study investigates the relationship between climate change disclosure and institutional investors. A particular focus of the present study is the question of if and how the relationship is affected by the Principles for Responsible Investment (PRI). A relevant context to the question is shareholder engagement, where institutional investors' legitimacy affects the outcomes. Thus, this study examines Japan, where shareholder engagement is the main pathway for institutional investors to convey their ESG‐related influence to investee companies. Using the stakeholder salience theory as a theoretical framework, the empirical results of analyzing 17,604 firm‐year eXtensible Business Reporting Language (XBRL) documents of listed Japanese companies provide evidence for the following. First, institutional stakeholders' holding ratio has positively influenced corporate climate change disclosure (power). Second, the positive influence of institutional investors is more significant when PRI‐signed institutional investors are present (legitimacy). Third, the aforementioned relations gained statistical significance gradually during the analysis period (urgency). Fundamentally, this study shows that the stakeholder salience theory contributes to a deeper understanding of the relationship.

Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1002/bse.3649

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:bla:bstrat:v:33:y:2024:i:4:p:3669-3686

Ordering information: This journal article can be ordered from
http://onlinelibrary ... 1002/(ISSN)1099-0836

Access Statistics for this article

Business Strategy and the Environment is currently edited by Richard Welford

More articles in Business Strategy and the Environment from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().