Does Shared Institutional Equity Enhance Corporate Eco-Transparency Reporting? Evidence from Firm Life Cycles Stages

Yishan Liu, Xingao Xu, Hongbo Hai and Hadi Hussain ()
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Yishan Liu: School of Economics and Finance, Xi’an Jiaotong University, Xi’an 710049, China
Xingao Xu: Business School, University of Warwick, Coventry CV4 7AL, UK
Hongbo Hai: School of Economics and Finance, Xi’an Jiaotong University, Xi’an 710049, China
Hadi Hussain: School of Economics and Finance, Xi’an Jiaotong University, Xi’an 710049, China

Sustainability, 2025, vol. 17, issue 2, 1-36

Abstract: This study investigates the relationship between corporate shared institutional equity (SIE) holders and eco-transparency reporting (ETR). Specifically, it examines three distinct types of SIE: (1) common institutional shareholders with industry peers, (2) the average count of unique institutional owners holding shares in both the focal company and its peers, and (3) the total percentage of SIE within the focal company. The findings indicate that firms with higher levels of SIE are more likely to disclose ETR, signaling a commitment to enhancing public trust and aligning with governmental expectations. Furthermore, the study explores the impact of SIE across different stages of the firm’s life cycle, revealing that the influence of SIE on ETR is more pronounced during the growth and mature stages. The results remain robust even when alternative thresholds for SIE are applied, such as adjusting from a 5% to a 3% threshold. To account for potential misspecification and omitted variables, propensity score matching (PSM), System generalized method of moments (Sys GMM) and two-stage least squares (2SLS) methods were employed. This research contributes to the literature by highlighting the role of shared institutional ownership in promoting environmental transparency, offering novel insights into how institutional investors can drive corporate sustainability practices across different firm life cycles.

Keywords: shared institutional equity; collaborative governance; eco-transparency reporting; stake-holder theory; legitimacy theory; China (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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