Title: Financial statement disclosures and environmental performance by US companies participating in the EU emissions trading system

Authors: Martin Freedman; Jin Dong Park; Ora Freedman; A.J. Stagliano

Addresses: Department of Accounting, College of Business and Economics, Towson University, Towson, MD 21252, USA ' Department of Accounting, College of Business and Economics, Towson University, Towson, MD 21252, USA ' College of Business and Leadership, Stevenson University, Stevenson, MD 21153, USA ' Department of Accounting, Erivan K. Haub School of Business, Saint Joseph's University, Philadelphia, PA 19131, USA

Abstract: In this study, we examine US firms that owned plants in the European Union (EU) that were among those required to participate in the EU's cap-and-trade system (EU-ETS) developed to reach emissions goals compliant with the Kyoto Protocol (Kyoto). Based on a Securities and Exchange Commission (SEC) interpretive release, US participants in the EU-ETS are required to disclose that involvement in their regulatory filings. Since these plants had to meet EU carbon emission standards, the research questions considered here is how successful the firms were in reducing carbon outputs and what was disclosed about their environmental performance. The results indicate that for these plants carbon emissions in 2012 declined relative to 2008 levels. And, in terms of disclosure, these firms disclosed significantly more about climate change and their EU-ETS participation during the later period than they did in 2008.

Keywords: carbon emissions; climate change; environmental disclosures; Kyoto Protocol.

DOI: 10.1504/IER.2018.10014562

Interdisciplinary Environmental Review, 2018 Vol.19 No.2, pp.111 - 122

Received: 28 Sep 2017
Accepted: 27 Nov 2017
Published online: 24 Jul 2018 *

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