ESG Disclosures in the Private Equity Industry

Journal of Accounting Research, forthcoming

119 Pages Posted: 15 Nov 2022 Last revised: 3 Jan 2024

See all articles by Jefferson K. Abraham

Jefferson K. Abraham

London Business School

Marcel Olbert

London Business School; ZEW – Leibniz Centre for European Economic Research - Corporate Taxation and Public Finance Research

Florin P. Vasvari

London Business School

Multiple version iconThere are 2 versions of this paper

Date Written: July 19, 2024

Abstract

This paper offers the first systematic evidence on environmental, social and governance (ESG) disclosures provided by a large global sample of private equity (PE) firms. Using historical websites from 2000 to 2022, we develop and validate a novel dictionary-based measure of voluntary PE firm ESG disclosures. Descriptive statistics reveal an increasing time trend in these disclosures, with social topics becoming as important as environmental topics recently. Multivariate analyses show that the demand for ESG information from fund investors is a significant determinant of PE firms’ ESG disclosures. Leveraging data on PE firms’ portfolio companies, we document that more PE firm ESG disclosures are associated with better environmental, social and governance outcomes at the portfolio company level, suggesting that voluntary ESG disclosures align with real actions for the average PE firm.

Keywords: Private Equity, Financial Reporting, ESG Disclosures, Voluntary Disclosures, ESG Investing, Sustainable Investment M41, G32, G34, G12

JEL Classification: M41, G32, G34, G12

Suggested Citation

Abraham, Jefferson K. and Olbert, Marcel and Vasvari, Florin P., ESG Disclosures in the Private Equity Industry (July 19, 2024). Journal of Accounting Research, forthcoming, Available at SSRN: https://ssrn.com/abstract=4265171 or http://dx.doi.org/10.2139/ssrn.4265171

Jefferson K. Abraham

London Business School ( email )

Sussex Place
Regent's Park
London, NW1 4SA
United Kingdom

Marcel Olbert (Contact Author)

London Business School ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom

ZEW – Leibniz Centre for European Economic Research - Corporate Taxation and Public Finance Research ( email )

United States

Florin P. Vasvari

London Business School ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom

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