Fighting Climate Change with Disclosure? The Real Effects of Mandatory Greenhouse Gas Emission Disclosure

Benedikt Downar, Jürgen Ernstberger, Hannes Rettenbacher, Sebastian Schwenen (sebastian.schwenen@tum.de) and Aleksandar Zaklan (aleksandar.zaklan@uni-rostock.de)

No 1795, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: We examine whether mandatory disclosure of greenhouse gas (GHG) emissions influences companies’ GHG emission levels. We identify the disclosure effect by exploiting a mandate requiring UK-incorporated listed companies to disclose information on GHG emissions in their annual reports. Using a difference-in-differences design, we show that disclosing GHG emissions in annual reports reduces emission levels by about 18% over three years. We find that emission reductions primarily occur for first-time mandatory reporters compared to firms who already voluntarily reported GHG information prior to the mandate. Further, we find that the emission reductions are permanent rather than transitory and we obtain stronger results for firms with larger savings potentials. Our effects are robust to various sample specifications, i.e., analysis at the installation- and firm-level, alternative control groups, and propensity score matching.

Keywords: Disclosure of non-financial information; greenhouse gas emissions; real effects (search for similar items in EconPapers)
JEL-codes: M41 M48 Q28 Q40 (search for similar items in EconPapers)
Pages: 39 p.
Date: 2019
New Economics Papers: this item is included in nep-ene, nep-env and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.diw.de/documents/publikationen/73/diw_01.c.616042.de/dp1795.pdf (application/pdf)

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:diw:diwwpp:dp1795

Access Statistics for this paper

More papers in Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research Contact information at EDIRC.
Bibliographic data for series maintained by Bibliothek (bibliothek@diw.de).