Learning to be Green: Accounting Comparability and Environmental Violations

Justin Chircop; Monika Tarsalewska; Agnieszka Trzeciakiewicz

doi:10.1016/j.bar.2023.101240

Learning to be Green: Accounting Comparability and Environmental Violations

Justin Chircop^*, Monika Tarsalewska, Agnieszka Trzeciakiewicz

^*Corresponding author for this work

Management

Research output: Contribution to journal › Article › peer-review

Abstract

Over recent years there has been an increasing awareness of the costs to the environment of corporate actions. We posit that accounting comparability between a firm and its peers, facilitates firm learning of the impact peer firm activities have on the environment. This learning allows the firm to reduce its own environmental violations. In line with this conjecture, our findings show that accounting comparability is negatively associated with environmental violations. Further, the reduction in firm environmental violations is larger in the presence of comparable peer firms disclosing low toxic releases, suggesting that firms are better able to learn from peer firms with low environmental impact. Our results provide novel evidence that accounting comparability facilitates green learning and therefore benefits society at large by reducing environmental harm.

Original language	English
Article number	101240
Number of pages	63
Journal	British Accounting Review
Volume	101240
DOIs	https://doi.org/10.1016/j.bar.2023.101240
Publication status	Accepted/In press - 27 Jul 2023

Bibliographical note

Keywords

Accounting comparability
toxic emissions
environmental violations

Access to Document

10.1016/j.bar.2023.101240Licence: CC BY

Cite this

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title = "Learning to be Green: Accounting Comparability and Environmental Violations",

abstract = "Over recent years there has been an increasing awareness of the costs to the environment of corporate actions. We posit that accounting comparability between a firm and its peers, facilitates firm learning of the impact peer firm activities have on the environment. This learning allows the firm to reduce its own environmental violations. In line with this conjecture, our findings show that accounting comparability is negatively associated with environmental violations. Further, the reduction in firm environmental violations is larger in the presence of comparable peer firms disclosing low toxic releases, suggesting that firms are better able to learn from peer firms with low environmental impact. Our results provide novel evidence that accounting comparability facilitates green learning and therefore benefits society at large by reducing environmental harm. ",

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