The Real Effects of Mandatory CSR Disclosure on Emissions: Evidence from the Greenhouse Gas Reporting Program

45 Pages Posted: 5 Jul 2021 Last revised: 13 Mar 2022

See all articles by Lavender Yang

Lavender Yang

Carnegie Mellon University

Nicholas Z. Muller

Carnegie Mellon University - David A. Tepper School of Business

Pierre Jinghong Liang

Tepper School of Business, Carnegie Mellon University

Date Written: July 2021

Abstract

We examine the real effects of the Greenhouse Gas Reporting Program (GHGRP) on electric power plants in the United States. Starting in 2010, the GHGRP requires both the reporting of greenhouse gas emissions by facilities emitting more than 25,000 metric tons of carbon dioxide per year to the Environmental Protection Agency and the public dissemination of the reported data in a comprehensive and accessible manner. Using a difference-in-difference research design, we find that power plants that are subject to the GHGRP reduced carbon dioxide emission rates by 7%. The effect is stronger for plants owned by publicly traded firms. We detect evidence of strategic behavior by firms that own both GHGRP plants and non-GHGRP plants. Such firms strategically reallocate emissions between plants to reduce GHGRP-disclosed emissions. We interpret this as evidence that the program is costly to the affected firms. Our results offer new evidence that public or shareholder pressure is a primary channel through which mandatory Corporate Social Responsibility (CSR) reporting programs affect firm behavior.

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Suggested Citation

Yang, Lavender and Muller, Nicholas Z. and Liang, Pierre Jinghong, The Real Effects of Mandatory CSR Disclosure on Emissions: Evidence from the Greenhouse Gas Reporting Program (July 2021). NBER Working Paper No. w28984, Available at SSRN: https://ssrn.com/abstract=3880217

Lavender Yang (Contact Author)

Carnegie Mellon University

Pittsburgh, PA 15213-3890
United States

Nicholas Z. Muller

Carnegie Mellon University - David A. Tepper School of Business ( email )

5000 Forbes Avenue
Pittsburgh, PA 15213-3890
United States

Pierre Jinghong Liang

Tepper School of Business, Carnegie Mellon University ( email )

5000 Forbes Avenue
Pittsburgh, PA 15213-3890
United States
412-268-3315 (Phone)
412-268-6837 (Fax)

HOME PAGE: http://www2.tepper.cmu.edu/andrew/liangj

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