The relationship between environmental performance and the extent of environmental disclosure

Abstract

Purpose of this study: This study examines the relationship between environmental performance and the extent of environmental disclosure. Methodology: The sample of this study consists of 35 high profile companies. The environmental performance is measured based on the results of the assessment of PROPER and the extent of environmental disclosure index by using GRI checklist items. This research applies content analysis, descriptive, and inferential statistical analyses. Main Findings: The result shows that the extent of environmental disclosure, on an average is low (22.5%). Mining companies provide the highest environmental disclosure (58.2%) followed by chemicals (21.4%), utilities (19.0%), pulp and papers (16.5%), industrial (11.0%), and oil and gas (4.2%). The analysis also presents that environmental performance does not affect the level of environmental disclosure. Implications: This result suggests that high environmental performance may not encourage companies to communicate more environmental issues. This finding indicates that motivation for a company to disclose environmental information is not always based on the legitimacy perspectives, but might be an accountability form.