Pub Date : 2025-09-01Epub Date: 2025-09-20DOI: 10.1016/j.bar.2025.101749
Hao Liang , Lilian Ng , Aaron Yoon
{"title":"Editorial: What have we learned about green and climate finance?","authors":"Hao Liang , Lilian Ng , Aaron Yoon","doi":"10.1016/j.bar.2025.101749","DOIUrl":"10.1016/j.bar.2025.101749","url":null,"abstract":"","PeriodicalId":47996,"journal":{"name":"British Accounting Review","volume":"57 5","pages":"Article 101749"},"PeriodicalIF":9.4,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145181277","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2024-04-02DOI: 10.1016/j.bar.2024.101381
Douglas Cumming , Huiying Wu , Yang Zhao
We investigate how geographic proximity between environmental regulators and firms affects corporate polluting behavior through resource constraints and information asymmetry. Using plant-level emissions data from China, we find that firms pollute less when they are located closer to regulators. Proximity is more closely connected to pollution when regulators are subject to greater financial constraints, more severe manpower shortages, and higher transportation costs related to inspection. These results provide support for a resource constraint channel. There is less evidence that proximity affects corporate pollution through an information asymmetry channel. A heterogeneity analysis shows that the impact of geographic proximity on plant pollution is weaker in regions with greater public attention to environmental issues. Overall, our results have implications for the strategic deployment of resources for environmental enforcement.
{"title":"The geography of environmental regulation: Plant-level emissions data","authors":"Douglas Cumming , Huiying Wu , Yang Zhao","doi":"10.1016/j.bar.2024.101381","DOIUrl":"10.1016/j.bar.2024.101381","url":null,"abstract":"<div><div>We investigate how geographic proximity between environmental regulators and firms affects corporate polluting behavior through resource constraints and information asymmetry<span>. Using plant-level emissions data from China, we find that firms pollute less when they are located closer to regulators. Proximity is more closely connected to pollution when regulators are subject to greater financial constraints, more severe manpower shortages, and higher transportation costs related to inspection. These results provide support for a resource constraint channel. There is less evidence that proximity affects corporate pollution through an information asymmetry<span> channel. A heterogeneity analysis shows that the impact of geographic proximity on plant pollution is weaker in regions with greater public attention to environmental issues. Overall, our results have implications for the strategic deployment of resources for environmental enforcement.</span></span></div></div>","PeriodicalId":47996,"journal":{"name":"British Accounting Review","volume":"57 5","pages":"Article 101381"},"PeriodicalIF":9.4,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140794346","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-03-05DOI: 10.1016/j.bar.2025.101614
Bill B. Francis , Iftekhar Hasan , Chunxia Jiang , Zenu Sharma , Yun Zhu
This paper examines the impact of climate risks on the debt structure of a sample of U.S. firms from 2002 through 2020. Climate risks—mainly physical, regulatory, and transition risks—are associated with a concentrated debt structure for the affected firms. However, when climate risks propagate through the channels of expected bankruptcy costs and sustainability, they are associated with a more diversified debt structure. Additionally, climate risks asymmetrically impact the relationship between access to finance and debt structure. Results from a quasi-natural experiment reaffirm the impact of climate risks on debt structure.
{"title":"Climate risks and debt structure","authors":"Bill B. Francis , Iftekhar Hasan , Chunxia Jiang , Zenu Sharma , Yun Zhu","doi":"10.1016/j.bar.2025.101614","DOIUrl":"10.1016/j.bar.2025.101614","url":null,"abstract":"<div><div>This paper examines the impact of climate risks<span><span> on the debt structure of a sample of U.S. firms from 2002 through 2020. Climate risks—mainly physical, regulatory, and transition risks—are associated with a concentrated debt structure for the affected firms. However, when climate risks propagate through the channels of expected bankruptcy costs and sustainability, they are associated with a more diversified debt structure. Additionally, climate risks asymmetrically impact the relationship between access to </span>finance and debt structure. Results from a quasi-natural experiment reaffirm the impact of climate risks on debt structure.</span></div></div>","PeriodicalId":47996,"journal":{"name":"British Accounting Review","volume":"57 5","pages":"Article 101614"},"PeriodicalIF":9.4,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145247983","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2024-06-12DOI: 10.1016/j.bar.2024.101423
Zhangfan Cao , Steven Xianglong Chen , Ting Dong , Edward Lee
We examine the impact of climate change uncertainty on supply chain financing. We find that firms significantly curtail trade credit provision during periods of high climate change uncertainty. The cross-sectional variations of this effect with firm-specific factors such as vulnerability to climate change, asset redeployability, and pollution severity suggest that it is primarily driven by managerial anticipation of physical damage cost rather than regulatory cost that the uncertainty could incur. The moderation of this effect by exogenous regulatory interventions such as state-level staggered adoption of the Climate Change Adaptation Plans and the Interstate Banking and Branching Efficiency Act suggests that managerial concerns of such cost can be alleviated through the improvement of climate change preparation and external financing respectively. Overall, our study reveals that climate change undermines the financial resilience of the supply chain and provides timely policy implications for tackling climate change against the backdrop of the global supply chain crisis.
{"title":"Climate change uncertainty and supply chain financing","authors":"Zhangfan Cao , Steven Xianglong Chen , Ting Dong , Edward Lee","doi":"10.1016/j.bar.2024.101423","DOIUrl":"10.1016/j.bar.2024.101423","url":null,"abstract":"<div><div>We examine the impact of climate change uncertainty on supply chain financing. We find that firms significantly curtail trade credit provision during periods of high climate change uncertainty. The cross-sectional variations of this effect with firm-specific factors such as vulnerability to climate change, asset redeployability, and pollution severity suggest that it is primarily driven by managerial anticipation of physical damage cost rather than regulatory cost that the uncertainty could incur. The moderation of this effect by exogenous regulatory interventions such as state-level staggered adoption of the Climate Change Adaptation Plans and the Interstate Banking and Branching Efficiency Act suggests that managerial concerns of such cost can be alleviated through the improvement of climate change preparation and external financing respectively. Overall, our study reveals that climate change undermines the financial resilience of the supply chain and provides timely policy implications for tackling climate change against the backdrop of the global supply chain crisis.</div></div>","PeriodicalId":47996,"journal":{"name":"British Accounting Review","volume":"57 5","pages":"Article 101423"},"PeriodicalIF":9.4,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141412281","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2023-10-28DOI: 10.1016/j.bar.2023.101271
Marco Ghitti , Gianfranco Gianfrate , Florencio Lopez-de-Silanes , Marco Spinelli
With the growth of green bonds as an asset class, the certification of the actual climate footprint of projects financed with these bonds is gaining momentum among investors and policymakers. We investigate the informative content of Second Party Opinions (SPOs) issued by external reviewers who assess the quality of green bonds by collecting a global sample of over 1200 corporate green bonds and analyzing matching results for 336 of them. We show that the market assigns a premium to the green bonds with the best SPOs' valuation - namely, the “dark-” and “medium-” green bonds. However, in presence of a formal credit rating, SPO external reviews do not appear to incorporate distinctive information priced by the market. Using a difference-in-difference approach, we find that stricter green investment regulations, like the adoption of the “EU Taxonomy,” produce a “fly-to-quality” effect that widens the spread between dark and lighter green bonds' returns. Responsible investors also appear to rely on the judgement of external reviewers when a formal credit rating is absent, and they have significantly higher stakes in the greener bonds. Overall, our results indicate that SPO external reviews can reduce information asymmetry between issuers and investors absent of a credit rating, but they are not informative for rated green bonds.
{"title":"What’s in a shade? The market relevance of green bonds’ external reviews","authors":"Marco Ghitti , Gianfranco Gianfrate , Florencio Lopez-de-Silanes , Marco Spinelli","doi":"10.1016/j.bar.2023.101271","DOIUrl":"10.1016/j.bar.2023.101271","url":null,"abstract":"<div><div>With the growth of green bonds<span> as an asset class, the certification of the actual climate footprint of projects financed with these bonds is gaining momentum among investors and policymakers. We investigate the informative content of Second Party Opinions (SPOs) issued by external reviewers who assess the quality of green bonds by collecting a global sample of over 1200 corporate green bonds and analyzing matching results for 336 of them. We show that the market assigns a premium to the green bonds with the best SPOs' valuation - namely, the “dark-” and “medium-” green bonds. However, in presence of a formal credit rating, SPO external reviews do not appear to incorporate distinctive information priced by the market. Using a difference-in-difference approach, we find that stricter green investment regulations, like the adoption of the “EU Taxonomy,” produce a “fly-to-quality” effect that widens the spread between dark and lighter green bonds' returns. Responsible investors also appear to rely on the judgement of external reviewers when a formal credit rating is absent, and they have significantly higher stakes in the greener bonds. Overall, our results indicate that SPO external reviews can reduce information asymmetry between issuers and investors absent of a credit rating, but they are not informative for rated green bonds.</span></div></div>","PeriodicalId":47996,"journal":{"name":"British Accounting Review","volume":"57 5","pages":"Article 101271"},"PeriodicalIF":9.4,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136160183","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2024-07-30DOI: 10.1016/j.bar.2024.101450
Greg Tindall
To date, the literature has not discovered diversification to be a firm policy that shareholders can influence through their proposals at annual meetings but has explained contexts in which diversification can defend. I contemplate and test diversifying responses to shareholder proposals made in the context of climate change. By following 440 shareholder-initiated proposals in the United States that contain “climate change” – from the first instance in the 1994 proxy season until 2020 – I find that firms in receipt of such proposals diversify more, mostly into related industries. Further, diversification prompted by climate proposals generally leads to wealth enhancements. Beyond correlations and the main results of ordinary least squares regressions, I address the endogenous nature of corporate policies in a variety of ways: a matching estimator, fixed effects, and an instrumental variable, along with a placebo and a GMM estimator. Robustness tests confirm prior results and expose a subtle difference between sales and asset diversification. Climate-related proposals appear to influence sales diversification slightly more than asset diversification, suggesting that agents may be less responsive to owner concerns than customers. Overall, shareholder proposals related to climate change can have the real effect of prompting firms to diversify.
{"title":"A real effect of climate-related shareholder proposals: Diversification","authors":"Greg Tindall","doi":"10.1016/j.bar.2024.101450","DOIUrl":"10.1016/j.bar.2024.101450","url":null,"abstract":"<div><div><span><span>To date, the literature has not discovered diversification to be a firm policy that shareholders can influence through their proposals at annual meetings but has explained contexts in which diversification can defend. I contemplate and test diversifying responses to shareholder proposals made in the context of climate change. By following 440 shareholder-initiated proposals in the United States that contain “climate change” – from the first instance in the 1994 proxy season until 2020 – I find that firms in receipt of such proposals diversify more, mostly into related industries. Further, diversification prompted by climate proposals generally leads to </span>wealth<span> enhancements. Beyond correlations and the main results of ordinary least squares regressions, I address the endogenous nature of corporate policies in a variety of ways: a matching estimator, fixed effects, and an </span></span>instrumental variable, along with a placebo and a GMM estimator. Robustness tests confirm prior results and expose a subtle difference between sales and asset diversification. Climate-related proposals appear to influence sales diversification slightly more than asset diversification, suggesting that agents may be less responsive to owner concerns than customers. Overall, shareholder proposals related to climate change can have the real effect of prompting firms to diversify.</div></div>","PeriodicalId":47996,"journal":{"name":"British Accounting Review","volume":"57 5","pages":"Article 101450"},"PeriodicalIF":9.4,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141910572","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-07-05DOI: 10.1016/j.bar.2025.101697
Lingxia Sun , Yanlin Bao , Jongmoo Jay Choi , Hoje Jo
Since climate change and environmental challenges are global in nature, one would expect MNCs to exhibit greater alignment with global environmental sustainability than domestic firms, given their exposure to international norms and stakeholder concerns. A counterargument is that MNCs might instead behave opportunistically, engaging in regulatory arbitrage related to emissions reduction by leveraging their global networks. Using a sample of 11,477 unique firms from 63 countries over the period of 2002–2022, we find that both the magnitude of carbon emissions and the quality of emissions disclosure are positively associated with firm internationalization. Additionally, U.S.-based MNCs that generate sales in civil law countries and regions tend to disclose more emissions information. Furthermore, the relationship between firm internationalization and emissions reduction is moderated by international environmental institutions, such as the Kyoto Protocol. Finally, we find that MNCs are rewarded by a broader stakeholder community for their efforts in reducing emissions. Overall, the results support the new institutionalism theory, suggesting that MNCs’ emissions reduction is perceived as alignment with global environmental norms.
{"title":"Firm internationalization and emissions Reduction: International evidence","authors":"Lingxia Sun , Yanlin Bao , Jongmoo Jay Choi , Hoje Jo","doi":"10.1016/j.bar.2025.101697","DOIUrl":"10.1016/j.bar.2025.101697","url":null,"abstract":"<div><div><span>Since climate change and environmental challenges are global in nature, one would expect </span>MNCs<span><span> to exhibit greater alignment with global environmental sustainability than domestic firms, given their exposure to international norms and stakeholder concerns. A counterargument is that </span>MNCs<span> might instead behave opportunistically, engaging in regulatory arbitrage related to emissions reduction by leveraging their global networks. Using a sample of 11,477 unique firms from 63 countries over the period of 2002–2022, we find that both the magnitude of carbon emissions<span> and the quality of emissions disclosure are positively associated with firm internationalization<span><span>. Additionally, U.S.-based MNCs<span> that generate sales in civil law countries and regions tend to disclose more emissions information. Furthermore, the relationship between firm internationalization and emissions reduction is moderated by international environmental institutions, such as the </span></span>Kyoto Protocol. Finally, we find that MNCs are rewarded by a broader stakeholder community for their efforts in reducing emissions. Overall, the results support the new institutionalism theory, suggesting that MNCs’ emissions reduction is perceived as alignment with global environmental norms.</span></span></span></span></div></div>","PeriodicalId":47996,"journal":{"name":"British Accounting Review","volume":"57 5","pages":"Article 101697"},"PeriodicalIF":9.4,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144621791","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2024-03-13DOI: 10.1016/j.bar.2024.101368
Xutang Liu , Sabri Boubaker , Jing Liao , Shouyu Yao
This study assesses the effect of common state ownership on corporate environmental performance. Using a large sample of Chinese listed firms, we find that state-owned common ownership leads to significantly enhanced corporate environmental performance. Our mechanism analysis indicates that state-owned common owners promote environmental-friendly practices through resource allocation mechanisms that alleviate corporate financial constraints. In addition, these owners play a leadership role in fostering corporate green innovation and enhancing the overall performance of the industry. Specifically, common state ownership leads to higher industry's green total factor productivity and profitability. Moreover, we observe that the positive relationship between common state ownership and corporate environmental performance is more pronounced in firms without politically connected CEOs/chairpersons and in privately owned firms.
{"title":"The rise of common state ownership and corporate environmental performance","authors":"Xutang Liu , Sabri Boubaker , Jing Liao , Shouyu Yao","doi":"10.1016/j.bar.2024.101368","DOIUrl":"10.1016/j.bar.2024.101368","url":null,"abstract":"<div><div><span>This study assesses the effect of common state ownership on corporate environmental performance. Using a large sample of Chinese listed firms, we find that state-owned common ownership leads to significantly enhanced corporate environmental performance. Our mechanism analysis indicates that state-owned common owners promote environmental-friendly practices through </span>resource allocation<span> mechanisms that alleviate corporate financial constraints. In addition, these owners play a leadership role in fostering corporate green innovation and enhancing the overall performance of the industry<span>. Specifically, common state ownership leads to higher industry's green total factor productivity and profitability. Moreover, we observe that the positive relationship between common state ownership and corporate environmental performance is more pronounced in firms without politically connected CEOs/chairpersons and in privately owned firms.</span></span></div></div>","PeriodicalId":47996,"journal":{"name":"British Accounting Review","volume":"57 5","pages":"Article 101368"},"PeriodicalIF":9.4,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140282264","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-07-05DOI: 10.1016/j.bar.2025.101698
Zinat Alam , Miran Hossain , Lingling Wang
We use the house transaction data to analyze why houses with energy-saving (green) features are sold for higher prices. We estimate house-specific economic values of green features and show that these values account for about 20–53 % of the green price premium, depending on how economic values are measured. Individual homebuyers' cultural origins and environmental attitudes also play a significant role in explaining the green price premium, with a weaker premium observed among less individualistic and indulgent buyers, and a stronger premium among those who are more uncertainty-avoidant and pro-environment. These results are robust to various strategies to address selection bias and cannot be explained by buyers' income levels or political orientations. Our findings point to both the economic and social value of green homes and highlight the role of investors’ behavioral preferences in evaluating green investments.
{"title":"The economic and cultural motives of green price premium","authors":"Zinat Alam , Miran Hossain , Lingling Wang","doi":"10.1016/j.bar.2025.101698","DOIUrl":"10.1016/j.bar.2025.101698","url":null,"abstract":"<div><div>We use the house transaction data to analyze why houses with energy-saving (green) features are sold for higher prices. We estimate <em>house-specific</em> economic values of green features and show that these values account for about 20–53 % of the green price premium, depending on how economic values are measured. Individual homebuyers' cultural origins and environmental attitudes also play a significant role in explaining the green price premium, with a weaker premium observed among less individualistic and indulgent buyers, and a stronger premium among those who are more uncertainty-avoidant and pro-environment. These results are robust to various strategies to address selection bias and cannot be explained by buyers' income levels or political orientations. Our findings point to both the economic and social value of green homes and highlight the role of investors’ behavioral preferences in evaluating green investments.</div></div>","PeriodicalId":47996,"journal":{"name":"British Accounting Review","volume":"57 5","pages":"Article 101698"},"PeriodicalIF":9.4,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144621789","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-09-01Epub Date: 2025-07-03DOI: 10.1016/j.bar.2025.101699
Wenquan Li , Suman Neupane , Kelvin Jui Keng Tan
This paper examines the relationship between corporate culture and firms’ environmental policies. We find that a strong corporate culture is associated with lower toxic emission levels and reduced pollution intensity. These reductions are genuine and not the result of “greenwashing,” as these firms mitigate harmful toxic releases without selectively targeting specific environmental regulations. The primary cultural values associated with the reduction in toxic emissions include teamwork, innovation, respect, and integrity. To alleviate potential endogeneity concerns, we exploit a quasi-natural experiment based on the forced departures of CEOs due to the sudden public exposure of legal violations or concerns. We also employ a propensity score matching approach and use alternative measures of firms’ environmental externalities. Furthermore, we find that diversity and research and development (R&D) expenses are among the potential channels through which this effect occurs. Importantly, the reduction in firms’ toxic releases does not come at the expense of production. Finally, the negative relationship between corporate culture and firm pollution is concentrated in plants located outside the headquarters’ state and in counties with nonattainment status.
{"title":"Environmental externalities of corporate culture: Evidence from firm pollution","authors":"Wenquan Li , Suman Neupane , Kelvin Jui Keng Tan","doi":"10.1016/j.bar.2025.101699","DOIUrl":"10.1016/j.bar.2025.101699","url":null,"abstract":"<div><div>This paper examines the relationship between corporate culture and firms’ environmental policies. We find that a strong corporate culture is associated with lower toxic emission levels and reduced pollution intensity. These reductions are genuine and not the result of “greenwashing,” as these firms mitigate harmful toxic releases without selectively targeting specific environmental regulations. The primary cultural values associated with the reduction in toxic emissions include teamwork, innovation, respect, and integrity. To alleviate potential endogeneity concerns, we exploit a quasi-natural experiment based on the forced departures of CEOs due to the sudden public exposure of legal violations or concerns. We also employ a propensity score matching approach and use alternative measures of firms’ environmental externalities. Furthermore, we find that diversity and research and development (R&D) expenses are among the potential channels through which this effect occurs. Importantly, the reduction in firms’ toxic releases does not come at the expense of production. Finally, the negative relationship between corporate culture and firm pollution is concentrated in plants located outside the headquarters’ state and in counties with nonattainment status.</div></div>","PeriodicalId":47996,"journal":{"name":"British Accounting Review","volume":"57 5","pages":"Article 101699"},"PeriodicalIF":9.4,"publicationDate":"2025-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144621786","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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