Environmental information transparency and firms' sustainable development: Evidence from automatic environment monitoring and information disclosure in China

Mengmeng Xu, Zihao Wang, Yanjiao Zhou, Feng Wang and Zhan Wu

Energy Economics, 2025, vol. 150, issue C

Abstract: Since 2012, to facilitate the implementation of the new ambient air quality standards (AAQS), the Chinese government has established a nationwide Automatic Environment Monitoring and Information Disclosure (AEMIC) system at the city level. However, further investigation is still required to explore the impact of this enhanced environmental information transparency on corporate sustainability, which serves as a crucial pathway for China's sustainable development. Therefore, this paper employs a difference-in-differences (DID) model to examine the influence of the AEMIC policy on the Environmental, Social and Governance (ESG) performance of Chinese main board listed enterprises using data from 2009 to 2021. The findings reveal that improved information transparency significantly enhances corporate ESG performance, primarily through mechanisms such as green technology innovation, financial pressure, and external monitoring pressure. Heterogeneity analysis indicates that the positive impact is concentrated among traditional polluters and state-owned enterprises, while the effects are negligible for non-traditional polluters and non-state-owned firms.

Keywords: Environmental information transparency; ESG performance; Difference-in-differences (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:150:y:2025:i:c:s014098832500653x

DOI: 10.1016/j.eneco.2025.108826

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