Impact of state ownership, gender diversity, and Confucianism on greenhouse gas (GHG) disclosures in China Event

Presenter

Dr Zhifeng Chen is a Lecturer in Accounting. Zhifeng joined the Southampton Business School in 2020 from the University of the West of England.  She holds a PhD in Management (University of Bath), an MSc in Accounting and Finance (University of Birmingham) and a BSc in Accounting (Fudan University, China). Zhifeng’s research is cross-disciplinary by nature, characterised by the use of psychological theories and experimentation to gain insights into fundamental social and accounting issues. In particular, her research focuses on social and environmental disclosure in social media, stakeholders’ decision-making, and CSR. Her work has been published in top journals such as Business Ethics Quarterly and Annals of Tourism Research.  Zhifeng regularly attends and presents papers at conferences. Social and environmental accounting, with a particular focus on social and environmental disclosure in social media.

Abstract

There is an increasing trend that firms disclose greenhouse gas emission to signal their environmental responsibilities and performance in dealing with climate change. Over the last decade, Chinese state-owned enterprises (SOEs) are becoming important players in international trade. Chinese SOEs have strong political connections with the Chinese government and are subject to political intervention and protection, which makes them different from their counterparts in OECD and G20 countries. In addition to the political impact, Chinese SOEs are influenced by Chinese traditional culture Confucianism and the corporate governance. Confucianism promotes harmony in the business by suggesting taking care of employees, communities, and establishing good business relationship with suppliers and customers.  It also emphasizes the hierarchy in the business structure which is not compliant with the equality and diversity. Furthermore, literature suggests board gender diversity improves business environmental performance due to woman’s communal characteristics and gender-based expectations.  However, the existing literature provides limited and mixed evidence on how state-ownership, board gender diversity, and Confucianism influence the likelihood of GHG disclosure. Through the lens of stakeholder-agency theory, this paper studies top 300 listed firms to examine the relationship between Chinese SOEs and the likelihood of GHG disclosure. We also examine how the relationship can be moderated by the gender diversity and Confucianism.   The result suggests there is a negative relationship between Chinese SOEs and the likelihood of GHG disclosure. The less likelihood of GHG disclosure in Chinese SOEs could be explained as consequences of the managers’ political self-interests, economic and policy oriented decision-making process, and the power differentials between the government and SOEs managers. The results also suggests that Confucianism positively moderates the negative relationship between the SOEs and the likelihood of GHG disclosure, i.e. further reduces the likelihood of GHG disclosure.  The gender diversity is not a moderator.  However, the combination of gender diversity and Confucian will improve the likelihood of GHG disclosure. This research provides empirical evidence in the GHG disclosure literature.  It also provides practical implication for SOEs managers’ performance evaluation, which need to explicitly incorporate the environmental performance criteria, improve the board gender diversity if the business is operating in a community with strong Confucianism.

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