The role of carbon risk diclosure in the relation between analyst following and market value

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2019-09-12

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en

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In times when environmental disclosure by firms becomes more and more important, this research investigates to what extent carbon risk disclosure moderates the relationship between analyst following and market value for 3.715 European and US firms in the period 2011-2017. In this research, analyst following is defined as the number of analysts following a firm. The results suggest that carbon risk disclosure has a positive moderating role. This implicates that the relationship between analyst following and market value becomes stronger when a firm discloses its carbon risks. These results were found for all three sorts of carbon risk disclosure: regulatory, physical and miscellaneous. In addition, carbon risk disclosure positively moderates the relationship between analyst following and information asymmetry, implicating that it weakens the negative effect of analyst following on information asymmetry. This study also provides further elaborations, limitations and suggestions for future research. Keywords: carbon risk disclosure; market value; analyst following; information asymmetry

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Faculteit der Managementwetenschappen