Environmental Disclosure Quality in Large German Companies: Economic Incentives, Public Pressures or Institutional Conditions?

Posted: 8 Mar 2005

See all articles by Denis Cormier

Denis Cormier

University du Quebec a Montreal

Michel Magnan

Concordia University - Department of Accountancy

Barbara Van Velthoven

University of Antwerp

Abstract

Investors and stakeholders in continental Europe are becoming increasingly concerned about corporate environmental policies. As a result, many firms are voluntarily increasing the extent of their environmental disclosure in their annual report. While mostly unregulated, corporate environmental disclosure does have potential economic significance considering the scarcity of alternative information sources. The purpose of this study is to identify determinants of corporate environmental disclosure using multi-theoretical lens that rely on economic incentives, public pressures and institutional theory. The study focuses on large firms from a continental Europe country, Germany, with a distinct legal and regulatory context and where environmental concerns are especially acute. Results show that Risk, Ownership, Fixed Assets Age, Firm Size as well as routine determine the level of environmental disclosure by German firms in a given year. Moreover, consistent with Institutional theory, results suggest that German firms' disclosure is converging over time. Overall, results strongly suggest that environmental disclosure is multi-dimensional and is driven by complementary forces.

Keywords: Environmental disclosure, disclosure quality, information costs, routine, public pressures

JEL Classification: M41, M45

Suggested Citation

Cormier, Denis and Magnan, Michel and Van Velthoven, Barbara, Environmental Disclosure Quality in Large German Companies: Economic Incentives, Public Pressures or Institutional Conditions?. Available at SSRN: https://ssrn.com/abstract=676407

Denis Cormier (Contact Author)

University du Quebec a Montreal ( email )

P.O. Box 8888, Downtown Station
Succursale Centre Ville School of Management 315 rue Ste-Catherine Est
Montreal, Quebec H3C 3P8
Canada
514-987-3000, ext. 8358 (Phone)
514-987-6629 (Fax)

Michel Magnan

Concordia University - Department of Accountancy ( email )

Montreal, Quebec H3G 1M8
Canada

Barbara Van Velthoven

University of Antwerp ( email )

Prinsstraat 13
Antwerpen, B-2020
Belgium

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