Customer-related performance and the relevance of environmental reporting

Ikram Radhouane, Mehdi Nekhili, Haithem Nagati and Gilles Paché ()
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Ikram Radhouane: CRET-LOG - Centre de Recherche sur le Transport et la Logistique - AMU - Aix Marseille Université
Haithem Nagati: ICD International Business School Paris
Gilles Paché: CRET-LOG - Centre de Recherche sur le Transport et la Logistique - AMU - Aix Marseille Université

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Abstract: Based on the fact that shareholders respond to environmental initiatives according to their perception of the potential related benefits, this study investigates whether customer-related performance affects the value relevance of voluntary environmental reporting. This paper provides a better understanding of the circumstances under which shareholders react positively to voluntary environmental information disclosed by firms operating in environmentally sensitive industries. Using a sample of French listed firms belonging to the SBF 120 stock index over an eleven-year period (2001–2011), our results show that a higher level of environmental disclosure is valued negatively by shareholders for firms operating in environmentally sensitive industries. In line with cost-benefit analysis, shareholders are found to rely more on profitability-based performance (i.e., return on sales and return on assets) than on revenue-based performance (i.e., sales growth) when assessing the relevance of environmental reporting for firms operating in environmentally sensitive industries.

Keywords: Customer-based performance; Environmental reporting; Environmentally sensitive industries; Shareholders (search for similar items in EconPapers)
Date: 2018-07
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Citations: View citations in EconPapers (4)

Published in Journal of Cleaner Production, 2018, 190, pp.315-329. ⟨10.1016/j.jclepro.2018.04.149⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02380567

DOI: 10.1016/j.jclepro.2018.04.149

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