The Impact of Corporate Environmental Disclosures and Audit Committees on Environmental Reputation
34 Pages Posted: 13 Jul 2015
Date Written: July 12, 2015
We examine the impact of the volume and quality of environmental disclosures in corporate annual reports on the creation and sustenance of firms’ reputation for environmental responsibility, and the extent to which these effects are enhanced by the quality of audit committees. Using a sample of UK FTSE350 companies from 2007-2011, we find evidence that firms enhance reputations by the quality of their environmental disclosures and by virtue of the quality of audit committees. Higher disclosure volume alone does not lead to increased reputation. Audit committees that comply with Smith (2003) recommendations, complement higher quality, difficult to replicate disclosures, in promoting reputation.
Keywords: Environmental Disclosure, Audit Committees, Environmental Reputation, UK FTSE350
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