Stakeholders and regulatory pressure on ESG disclosure

Unofficial AI-generated summary based on the public title and abstract. Not an official translation.

🔬研究者:Provides causal evidence on the interaction between regulatory regimes and stakeholder pressure on ESG disclosure, useful for disclosure theory and policy evaluation.

🏢実務担当者:Highlights how mandatory regulation can reshape stakeholder expectations; useful for corporate sustainability teams anticipating disclosure requirements.

🏛政策担当者:Demonstrates that mandatory disclosure regulation can effectively substitute for stakeholder pressure, and that domestic regulation can have cross-border effects on foreign firms.

We focus on the impact of stakeholders' pressure on the levels of ESG transparency exhibited by companies operating under different regulatory frameworks – specifically, within voluntary or mandatory disclosure regimes – between 2012 and 2020. Our analysis encompasses European and US listed companies, each having taken distinct paths toward sustainability reporting. Europe underwent the transition to a mandatory disclosure regime with the implementation of the EU 2014 Non-Financial Reporting Directive, while the US adopted a market-based approach, often referring to disclosure frameworks established by non-governmental entities. Our findings reveal that, under the voluntary disclosure regime, higher pressure toward transparency is primarily driven by employee-oriented and environmentally sensitive companies. However, during the mandatory regime for European firms, regulatory pressure takes the place of the previously exerted pressure by stakeholders. US-listed firms are indirectly impacted by the European regulatory transition, exhibiting heightened levels of pressure on reporting demanded by stakeholders in environmentally sensitive industries, as well as by institutional investors.