WHAT MOTIVATES EU FIRMS TO DISCLOSE GREENHOUSE GAS EMISSIONS: EVIDENCE FROM ITALIAN COMPANIES

This paper aims to investigate the main determinants that may motivate Italian listed firms to voluntarily disclose carbon information, by using the stakeholder theory as redefined by the Ullmann’s (1985) three dimensional framework. We perform a manually content analysis of the environmental/sustainability reports to examine the information provided on the basis of the key elements required by the Kyoto Protocol. We develop two disclosure indexes based on weighting schemes: equal weights and differential weights (unequal weights), then we adopt a well-established methodology that focuses on isolating independent variables for the three dimensions of Ullman framework. Our results indicate that, for both equal and unequal weights, there is a negative association of carbon disclosure index with government power, while a positively association with employee power, the environmental committee, the board independence, the greater moral duty of directors and with size. The significance level is lower for government power and board independence when considering the unequal disclosure index. Lastly, when considering the interaction between governmental and creditor power, carbon disclosure is negatively affected. This research adds to existing literature on carbon disclosure and contributes to the scientific debate. We provide an original extension of the Ullmann’s model, since we test two new variables, one for the stakeholder power dimension and one for the strategic posture dimension. Some suggestions for further development of the research conclude the study