Does the Impact of Transparency and Disclosure on the Firm’s Valuation Depend on the ESG?

Venkata Mrudula Bhimavarapu (), Shailesh Rastogi, Rajani Gupte, Geetanjali Pinto and Sudam Shingade
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Venkata Mrudula Bhimavarapu: Symbiosis Institute of Business Management, Symbiosis International (Deemed University), Pune 412115, India
Shailesh Rastogi: Symbiosis Institute of Business Management, Symbiosis International (Deemed University), Pune 412115, India
Rajani Gupte: Department of Management, Symbiosis International (Deemed University), Pune 412115, India
Geetanjali Pinto: Department of Finance, SIES School of Business Studies, Navi Mumbai 400706, India
Sudam Shingade: Symbiosis Institute of Business Management, Symbiosis International (Deemed University), Pune 412115, India

JRFM, 2022, vol. 15, issue 9, 1-12

Abstract: The global economic crisis in 1997 significantly impacted all corporate firms. Measuring valuation is becoming increasingly important in corporate firm analysis. Transparency in disclosures enables a company to meet market expectations while also adhering to regulatory requirements. The study’s primary purpose is to measure the impact of transparency and disclosures on the valuation of non-financial firms in India and explore the role of Environmental, social and Governance (ESG) as a moderator variable in determining the firm’s value. Panel data regression is the methodology adopted for the data analysis in the study. Panel Data of seventy-six non-financial firms was collected for ten years (2011–2020). Market capitalization is considered as a proxy variable for the valuation. The study results indicate that transparency and disclosures (TD) have a negative and significant influence on the value of the firms. Inferring that a higher degree of TD reduces the firm value. At the same time, the interaction term of TD and ESG show a positive significant association. This finding implies that high ESG reduces the negative impact of high TD on the valuation.

Keywords: transparency; disclosures; non-financial firms; valuation; India (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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