The Quality of Corporate Environmental Reporting (CER): Theory and Practice

  • Araya Eakpisankit

Student thesis: Doctoral ThesisPhD


Due to the fact that corporate environmental reporting (CER) is largely voluntary and unregulated, practice has evolved in the absence of a meaningful conceptual framework. This lack of a normative theory stating what should be the content of CER as well as the methods for measuring reported information being largely volumetric or content based, is advanced as a major limitation in the existing literature. In this study, the wellestablished conceptual frameworks for financial reporting are adapted as the basis for a CER conceptual framework in which four characteristics of CER indicate its quality. Empirical methods for the measurement of such characteristics are also adapted from the financial reporting literature. The main aim of this research is to use the adapted framework to examine the extent of variation in the quality of CER and then to test its applicability to the key motivational theories. The empirical work involves a panel of US and UK firms over a two-year period. This allows cross-sectional comparison to be made between different financial accounting regimes (rules- vs. principles-based) as well as permits examination of the development of CER over time. Further, the empirical work is extended to investigate the interrelationship between the financial and environmental performance of a firm. Evidence in support of the legitimacy and institutional theory explanations for disclosure motivations is comprehensively found through the measures of the qualitative characteristics identified. That is, the use of a novel CER framework based on financial reporting quality here enables a more robust understanding of the reporting behaviours than previous work. Moreover, evidence for CER variation owing to the differences in financial reporting regimes is found and thus, it is reasonable to assert that the culture of financial reporting, to some extent, informs the nature of voluntary non-financial reporting. However, perhaps owing to the short time frame of the investigation, evidence of financial rewards from being environmentally effective or through providing CER is not found. The findings from this research will be of interest to preparers and users of corporate environmental reports as well as to policymakers, particularly in terms of enabling them to assess the quality of reporting and its level of fit with their expectations. Moreover, they also shed light on the link between environmental performance, as manifested in carbon emissions, and what is reported.
Date of Award30 Apr 2012
Original languageEnglish
Awarding Institution
  • University of Bath
SupervisorPhilip Cooper (Supervisor)


  • environmental disclosure
  • environmental reporting
  • non-financial reporting
  • quality of environmental reporting
  • environmental reporting framework
  • stakeholder theory
  • legitimacy theory
  • institutional theory
  • UK
  • US

Cite this