Does environmental management system certification keep enterprises out of trouble? Evidence from stock price crash risk.
This paper examines the impact of environmental management system (EMS) certification, a significant voluntary participatory environmental regulation, on the risk of stock price collapse. The study is based on sample data of heavily polluting listed companies from 2008-2020. The study demonstrates t...
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| Format: | Article |
| Language: | English |
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Public Library of Science (PLoS)
2024-01-01
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| Series: | PLoS ONE |
| Online Access: | https://doi.org/10.1371/journal.pone.0311740 |
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| author | Hongyu Liu Qin Binbin Pengliang Qiao |
| author_facet | Hongyu Liu Qin Binbin Pengliang Qiao |
| author_sort | Hongyu Liu |
| collection | DOAJ |
| description | This paper examines the impact of environmental management system (EMS) certification, a significant voluntary participatory environmental regulation, on the risk of stock price collapse. The study is based on sample data of heavily polluting listed companies from 2008-2020. The study demonstrates that certification of environmental management systems has a significant impact on preventing share price collapse. This finding remains consistent even after controlling for endogeneity and conducting robustness tests. The analysis also reveals that the inhibitory effect of EMS certification is more pronounced for state-owned enterprises and firms with a higher degree of marketisation. Exploring the mechanism of its influence, it is found that environmental management system certification mainly suppresses the risk of stock price collapse by improving the environmental performance of enterprises and the transparency of corporate information, suggesting that environmental management system certification can be used as both an "environmental governance tool" for suppressing stock price collapse and an "information transfer tool" for improving the transparency of corporate information, thus suppressing the risk of stock price collapse. Meanwhile, the media's attention has been found to moderate the effect of environmental management system certification on stock price crash risk. These findings validate the inhibitory effect of environmental management system certification on stock price crash risk, expand our understanding of the economic consequences of environmental management system certification and the factors that influence stock price crash risk. They also provide a theoretical basis and practical support for environmental regulators. |
| format | Article |
| id | doaj-art-783c7cd574af41dd8e0f8d5149861dfd |
| institution | Kabale University |
| issn | 1932-6203 |
| language | English |
| publishDate | 2024-01-01 |
| publisher | Public Library of Science (PLoS) |
| record_format | Article |
| series | PLoS ONE |
| spelling | doaj-art-783c7cd574af41dd8e0f8d5149861dfd2025-01-17T05:31:56ZengPublic Library of Science (PLoS)PLoS ONE1932-62032024-01-011912e031174010.1371/journal.pone.0311740Does environmental management system certification keep enterprises out of trouble? Evidence from stock price crash risk.Hongyu LiuQin BinbinPengliang QiaoThis paper examines the impact of environmental management system (EMS) certification, a significant voluntary participatory environmental regulation, on the risk of stock price collapse. The study is based on sample data of heavily polluting listed companies from 2008-2020. The study demonstrates that certification of environmental management systems has a significant impact on preventing share price collapse. This finding remains consistent even after controlling for endogeneity and conducting robustness tests. The analysis also reveals that the inhibitory effect of EMS certification is more pronounced for state-owned enterprises and firms with a higher degree of marketisation. Exploring the mechanism of its influence, it is found that environmental management system certification mainly suppresses the risk of stock price collapse by improving the environmental performance of enterprises and the transparency of corporate information, suggesting that environmental management system certification can be used as both an "environmental governance tool" for suppressing stock price collapse and an "information transfer tool" for improving the transparency of corporate information, thus suppressing the risk of stock price collapse. Meanwhile, the media's attention has been found to moderate the effect of environmental management system certification on stock price crash risk. These findings validate the inhibitory effect of environmental management system certification on stock price crash risk, expand our understanding of the economic consequences of environmental management system certification and the factors that influence stock price crash risk. They also provide a theoretical basis and practical support for environmental regulators.https://doi.org/10.1371/journal.pone.0311740 |
| spellingShingle | Hongyu Liu Qin Binbin Pengliang Qiao Does environmental management system certification keep enterprises out of trouble? Evidence from stock price crash risk. PLoS ONE |
| title | Does environmental management system certification keep enterprises out of trouble? Evidence from stock price crash risk. |
| title_full | Does environmental management system certification keep enterprises out of trouble? Evidence from stock price crash risk. |
| title_fullStr | Does environmental management system certification keep enterprises out of trouble? Evidence from stock price crash risk. |
| title_full_unstemmed | Does environmental management system certification keep enterprises out of trouble? Evidence from stock price crash risk. |
| title_short | Does environmental management system certification keep enterprises out of trouble? Evidence from stock price crash risk. |
| title_sort | does environmental management system certification keep enterprises out of trouble evidence from stock price crash risk |
| url | https://doi.org/10.1371/journal.pone.0311740 |
| work_keys_str_mv | AT hongyuliu doesenvironmentalmanagementsystemcertificationkeepenterprisesoutoftroubleevidencefromstockpricecrashrisk AT qinbinbin doesenvironmentalmanagementsystemcertificationkeepenterprisesoutoftroubleevidencefromstockpricecrashrisk AT pengliangqiao doesenvironmentalmanagementsystemcertificationkeepenterprisesoutoftroubleevidencefromstockpricecrashrisk |