UCL Discovery
UCL home » Library Services » Electronic resources » UCL Discovery

A large-scale analysis of the heterogeneity of markets’ reactions to the disclosure of nonfinancial information

Cenci, Simone; (2023) A large-scale analysis of the heterogeneity of markets’ reactions to the disclosure of nonfinancial information. Journal of Sustainable Finance & Investment 10.1080/20430795.2023.2228746. Green open access

[thumbnail of A large-scale analysis of the heterogeneity of markets  reactions to the disclosure of nonfinancial information.pdf]
Preview
Text
A large-scale analysis of the heterogeneity of markets reactions to the disclosure of nonfinancial information.pdf - Other

Download (3MB) | Preview

Abstract

To allocate capital to its most sustainable use, market participants need information on companies' sustainability plans and initiatives. This information is disclosed in sustainability reports, but the disclosure process is largely unregulated and voluntary. When do sustainability reports convey relevant information? To answer this question we estimate the heterogeneous effects of nonfinancial disclosure on analysts' estimates of earnings and firms' equity values. We have found that the information content of nonfinancial disclosure is larger when firms are subject to greater information asymmetry, and when nonfinancial information is integrated within a financial context. Moreover, positive responses have a long-lasting impact while negative shocks are corrected within a short window. Overall, our work suggests that market participants' interest in standalone nonfinancial information is limited, and integrated reporting increases the value of sustainability reports.

Type: Article
Title: A large-scale analysis of the heterogeneity of markets’ reactions to the disclosure of nonfinancial information
Open access status: An open access version is available from UCL Discovery
DOI: 10.1080/20430795.2023.2228746
Publisher version: https://doi.org/10.1080/20430795.2023.2228746
Language: English
Additional information: © The Author(s), 2023. This is an open access article distributed under the terms of the Creative Commons Attribution-Non Commercial-No Derivatives License 4.0 (CC-BY-NC-ND), where it is permissible to download and share the work provided it is properly cited. The work cannot be changed in any way or used commercially without permission from the journal. http://creativecommons.org/licenses/by-nc-nd/4.0/
Keywords: Sustainability reporting, heterogeneous effects, information asymmetry, integrated reporting
UCL classification: UCL
UCL > Provost and Vice Provost Offices > UCL BEAMS
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of the Built Environment
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of the Built Environment > Bartlett School Env, Energy and Resources
URI: https://discovery.ucl.ac.uk/id/eprint/10196465
Downloads since deposit
6Downloads
Download activity - last month
Download activity - last 12 months
Downloads by country - last 12 months

Archive Staff Only

View Item View Item