Hani Tadros, Michel Magnan and Emilio Boulianne
This study aims to examine the disclosure determinants of environmental performance indicators (EPIs) for a sample of US firms to understand if these disclosures are reliable or…
Abstract
Purpose
This study aims to examine the disclosure determinants of environmental performance indicators (EPIs) for a sample of US firms to understand if these disclosures are reliable or whether they are biased towards the reporting of positive information.
Design/methodology/approach
The study uses a panel data analysis to examine the association between firms’ EPIs disclosures and their environmental performances, and other economic and legitimacy factors.
Findings
The results show that firms’ disclosures are not associated with the level of environmental performance and that firms continue to provide EPI information even if they witness a decline in their environmental performance. The evidence suggests that firms’ environmental disclosures are reliable and indicative of their environmental performance.
Practical implications
The findings suggest that mandating EPI disclosures may increase the level of the information reported and reduce firms’ discretion over the disclosure of such information.
Originality/value
Reporting of EPIs is directly linked to firms’ environmental performances. By examining the association between EPI disclosures and environmental performance, the study contributes to the ongoing debate about firms’ reporting and whether it is informative to its stakeholders or whether firms use this type of information to legitimize their operations and portray it in a positive light.
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Focusing on a sample of firms from environmentally sensitive industries over several years, this study aims to reexamine the association between environmental disclosure and…
Abstract
Purpose
Focusing on a sample of firms from environmentally sensitive industries over several years, this study aims to reexamine the association between environmental disclosure and environmental performance.
Design/methodology/approach
The authors use a panel data analysis to examine how the interaction between environmental performance and economic and legitimacy factors influence firms’ environmental disclosures.
Findings
Results suggest that environmental performance moderates the effect of economic and legitimacy incentives on firms’ propensity to provide proprietary environmental disclosure, with both sets of incentives being influential. More specifically, there appears to be a reporting bias based on the firm’s environmental performance whereas the high-performers disclose more environmental information in the three following vehicles: annual report, 10-K and sustainability reports combined. Results also show that economic and legitimacy factors influence the disclosure decisions of the low and high environmental performers differently.
Practical implications
Understanding the determinants of environmental disclosure for high and low environmental performers helps regulators to close the reporting gap between these firms.
Social implications
There is little evidence to suggest that firms with low-environmental performance attempt to use their disclosures to legitimize their environmental operations.
Originality/value
The study examines environmental disclosures of 78 firms over a period of 14 years in annual, 10-K and sustainability reports. The panel data analysis controls for significant cross-sectional and period effects.
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Behavioral aspects and positive attitudes toward the balanced scorecard (BSC) could be a determinant factor in the success of BSC implementation. In the study we use the…
Abstract
Behavioral aspects and positive attitudes toward the balanced scorecard (BSC) could be a determinant factor in the success of BSC implementation. In the study we use the contingency theory framework to examine whether adopting a planned strategy improves employees’ buying into the BSC and helps to maximize the benefits of BSC implementation by enhancing corporate performance. We hypothesize that employees’ attitudes and perceptions toward the implementation of the BSC are contingent upon the type of strategy the firm is employing and the suitability of deploying the BSC with this strategy in place. We use a path model that draws an association between the firm's strategy and employee attitudes toward BSC implementation and employs OLS regression to test the association between the variables. We also examine whether employees’ positive attitudes help to improve a firm's performance as proxied by the customer, internal processes, learning and innovation, and financial perspectives of the BSC. We sent a mail survey to Canadian and US firms to collect the necessary data in order to conduct this study.
Conforming to our expectations, we find that firms that carefully plan their strategic objectives are more likely to have a positive impact on their employees’ perception of the BSC. A deliberate strategy – or planned strategy – as defined by Mintzberg (1978) is associated with higher levels of BSC awareness, perceptions of BSC ease of use, perceptions of BSC usefulness, and intentions to use the BSC. We also find that higher perceptions of BSC ease of use are positively associated with aspects of a firm's performance, such as from the customer, internal processes, and learning and innovation perspectives. Hence, we conclude that firms implementing the BSC need to take into consideration that the successful implementation of the BSC requires careful planning to ensure that the firm's strategic objectives are well formulated, in agreement with BSC measures, and effectively communicated to BSC users.