COVID-19 pandemic resilience: an analysis of firm valuation and disclosure of sustainability practices of listed firms

IF 2.8 3区 管理学 Q2 BUSINESS, FINANCE Managerial Auditing Journal Pub Date : 2022-10-10 DOI:10.1108/maj-06-2021-3183
Soon‐Yeow Phang, Christofer Adrian, Mukesh Garg, Anh Viet Pham, Cameron Truong
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引用次数: 4

Abstract

Purpose This paper aims to investigate the effect of firms’ sustainability practices on firm performance and valuation during the COVID-19 pandemic. Design/methodology/approach Using a sample of Australian listed firms from 2011 to 2021, the authors perform textual analysis on sustainability practices from annual reports and sustainability report disclosures and include this variable in various regression models that assess firm valuation. The authors also use propensity score matching and Heckman two-stage regression methodology to address endogeneity concerns. Findings The authors find that firms disclosing sustainability practices exhibit higher market valuations relative to other firms. Specifically, loss-making firms exhibit higher market valuation during the COVID-19 crisis relative to prior period. The authors also observe a negative association between sustainability practices and firm performance proxied by return on assets. The findings suggest that engagement in sustainable practices helps loss-making firms remain resilient during the pandemic. In addition, the authors find that the positive relation between sustainability practices and firm value is stronger among firms with a higher level of annual report readability. Originality/value Considering the conflicting evidence in the literature on the economic benefits of sustainability practices, this study takes advantage of the heterogeneity in corporate practices and provides empirical evidence that a firm’s sustainability practices can build economic resilience during the COVID-19 pandemic crisis. The authors believe the findings of the study is timely in informing the regulators and standard-setters on changes in reporting required to increase sustainability in the business practices.
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COVID-19大流行韧性:上市公司估值与可持续性实践披露分析
目的研究新冠肺炎疫情期间企业可持续性实践对企业绩效和估值的影响。设计/方法/方法使用2011年至2021年澳大利亚上市公司的样本,作者对年度报告和可持续性报告披露的可持续性实践进行了文本分析,并将该变量纳入评估公司估值的各种回归模型中。作者还使用倾向得分匹配和Heckman两阶段回归方法来解决内生性问题。研究结果作者发现,与其他公司相比,披露可持续发展实践的公司表现出更高的市场估值。具体而言,亏损公司在新冠肺炎危机期间表现出比前一时期更高的市场估值。作者还观察到,可持续性实践与资产回报率所代表的企业绩效之间存在负相关。研究结果表明,参与可持续实践有助于亏损企业在疫情期间保持韧性。此外,作者发现,在年度报告可读性较高的公司中,可持续性实践与公司价值之间的正相关关系更强。原创/价值考虑到文献中关于可持续性实践的经济效益的相互矛盾的证据,本研究利用了企业实践的异质性,并提供了经验证据,表明企业的可持续性实践可以在新冠肺炎大流行危机期间建立经济韧性。作者认为,这项研究的结果及时地向监管机构和标准制定者通报了提高商业实践可持续性所需的报告变化。
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来源期刊
CiteScore
5.40
自引率
13.80%
发文量
45
期刊介绍: The key areas addressed are: ■Audit and Assurance (financial and non-financial) ■Financial and Managerial Reporting ■Governance, controls, risks and ethics ■Organizational issues including firm cultures, performance and development In addition, the evaluation of changes occurring in the auditing profession, as well as the broader fields of accounting and assurance, are also explored. Debates concerning organizational performance and professional competence are also covered.
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