Journal of Accounting Research Vol. 62 No. 5 2024

The Effects of Mandatory ESG Disclosure Around the World

Philipp Krueger¹; Zacharias Sautner²; Dragon Yongjun Tang³; Rui Zhong⁴

¹ University of Geneva (Geneva School of Economics and Management; Geneva Finance Research Institute) and Swiss Finance Institute · ² University of Zurich and Swiss Finance Institute , · ³ University of Hong Kong · ⁴ University of Western Australia

Abstract

We compile a novel data set on mandatory environmental, social, and governance (ESG) disclosure around the world to analyze the stock liquidity effects of such disclosure mandates. We document a positive effect of ESG disclosure mandates on firm‐level stock liquidity. The effects are strongest if the disclosure requirements are implemented by government institutions, not on a comply‐or‐explain basis, and coupled with strong enforcement by informal institutions. Firms with weaker information environments benefit more from ESG disclosure mandates. Our results support the view that ESG disclosure regulation improves the information environment and has beneficial capital market effects.

DOI

10.1111/1475-679x.12548

Volume

62

Issue

5

Pages

1795-1847

Language

en

Sources

bibtex:phds-export.bib openalex crossref

Cite

APA 7 MLA 9 Chicago (author–date) Harvard Elsevier Harvard (JFE, JBF…) The Accounting Review Academy of Management American Marketing Association INFORMS (Management Science) Copy citation Copied ✓