The Relations Among Environmental Disclosure, Environmental Performance and Financial Performance : An Empirical Study in China

Both of previous theoretical interpretations and empirical evidences provide mixed conclusions on the relations among corporate environmental disclosure, environmental performance and financial performance. In this article, I visit these relations under Chinese setting with environmental disclosure measured by a scoring system similar to Clarkson et al (2008) study, environmental performance measured by the types of penalty for firm's over-emission, financial performance gauged by ROA. Using the average data of all of 68 Chinese listed firms in building material, paper and pulp industries from 2007-2009, I find negative association between environmental disclosure and environmental performance, positive relation between financial performance and environmental performance, and no significant relation between financial performance and environmental disclosure. In addition, I find ISO14001 have significant and positive impact on environmental disclosure, and firm size has significant and positive impacts on all of the three variables