Impact of carbon information disclosure on corporate financing constraints: Evidence from the Carbon Disclosure Project

Heshu Huang, Yuchen Zou, Liukai Wang, Weiqing Wang and Xiaohong Ren
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Yuchen Zou: School of Business, Anhui University, Hefei, China
Liukai Wang: University of Science and Technology Beijing, Beijing, China
Weiqing Wang: School of Economics & Management, University of Science and Technology Beijing, Beijing, China
Xiaohong Ren: Business School, Central South University, Changsha, China

Australian Journal of Management, 2025, vol. 50, issue 1, 104-131

Abstract: With peak carbon dioxide emissions and a carbon-neutral background, the initiative of enterprises to disclose information voluntarily is insufficient, this study attempts to study the impact of carbon information disclosure on financing constraints to encourage companies’ carbon information disclosure. Previous literature usually uses a binary variable to measure whether an enterprise participates in Carbon Disclosure Project (CDP), and rarely study the impact of carbon information disclosure on economic consequences by acquiring all CDP levels manually. And most of these theories are mostly based on developed countries. Based on the whole sample of 1293 Chinese listed companies participating in the CDP from 2016 to 2020, this study employed the oversampling technology to end unbalanced CDP data, then an ordinary least squares (OLS) regression to account for time-invariant industry heterogeneity and time trends is employed. The empirical results indicate that the higher the CDP level, the smaller the financing constraints of enterprises. Moreover, the channel analysis indicates that carbon information disclosure is alleviating financing constraints by reducing information asymmetry and enhancing corporate reputation. This study bridges the gap in existing research on alleviating corporate financing constraints through the emerging CDP, which also presents the detailed implications for companies and policy makers. JEL Classification: G14; G20; M14; Q51

Keywords: Carbon Disclosure Project; carbon information disclosure; corporate reputation; financing constraints; information asymmetry (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:sae:ausman:v:50:y:2025:i:1:p:104-131

DOI: 10.1177/03128962231180265

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