Twitter carbon information and cost of equity: the moderating role of environmental performance

This study aims to examine the moderating role of a firm’s environmental performance, measured by its environmental strength and concern ratings, on the influences of Twitter dissemination of carbon-related information (Carbon_Tweets) on a firm’s cost of equity (COE). Our key focus is to provide an insight as to whether different levels of environmental strength and concern would influence the effect of Carbon_Tweets on the COE. Employing the sample of non-financial NASDAQ firms covering the period between 2009 and 2015, we found that the negative association of Carbon_Tweets and COE is strengthened for firms that have higher levels of environmental concerns, meanwhile the results stay the same for different level of environmental strength. These findings imply that although all firms can achieve lower COE by employing Twitter as a dissemination channel of Carbon information, firms with a concerning environmental status may benefit more by strategically disseminating via Twitter.