Accounting and Finance Department Research Seminar
When: Friday,
February 9, 2024
10:00 AM
-
11:15 AM
Where: > See description for location
Description: The Department of Accounting & Finance announces the following research seminar.
Speaker: Professor. Estelle Sun (Boston University)
Title: ESG Risk Disclosures: The Predictive Ability of SASB Recommendations versus Industry Best Practice
Date: Friday, February 9, 2024
Time: 10:00-11:15 AM
Location: via Zoom Meeting
https://umassd.zoom.us/j/4387551509?pwd=bVB2QzdtRmFCdkk1WTVQSUxHMS9iQT09
Meeting ID: 438 755 1509
Abstract: This paper examines the predictive ability of ESG risk disclosures. Using a textual analysis-based approach, we derive measures assessing firms’ material ESG risk disclosures with respect to two benchmarks: SASB recommendations, discerned through analysis of the Materiality Map applied to the risk factors section of firms’ 10-Ks; and industry best practice, discerned using the ESG risks disclosed by the majority of the industry’s largest firms. Descriptively, we document (i) considerable variation in the consistency of firms’ ESG disclosures with SASB recommendations; (ii) that firms disclose as material a large number of ESG risk factors deemed immaterial per SASB recommendations; and (iii) that firms’ disclosures of material ESG risks are more consistent with industry best practice. We find that two left-tail ESG outcomes—subsequent year ESG penalties and incidents—are predicted by firms’ material ESG risk disclosures that are consistent with industry best practice, but not those deemed as material per the SASB framework. Overall, the results suggest that for left-tail ESG events the strongest predictive ability lies within ESG topics outside of those denoted as material per SASB, and within those denoted as material per industry leader firms.
For additional information, please contact Prof. Hongkang Xu at hxu5@umassd.edu.
Speaker: Professor. Estelle Sun (Boston University)
Title: ESG Risk Disclosures: The Predictive Ability of SASB Recommendations versus Industry Best Practice
Date: Friday, February 9, 2024
Time: 10:00-11:15 AM
Location: via Zoom Meeting
https://umassd.zoom.us/j/4387551509?pwd=bVB2QzdtRmFCdkk1WTVQSUxHMS9iQT09
Meeting ID: 438 755 1509
Abstract: This paper examines the predictive ability of ESG risk disclosures. Using a textual analysis-based approach, we derive measures assessing firms’ material ESG risk disclosures with respect to two benchmarks: SASB recommendations, discerned through analysis of the Materiality Map applied to the risk factors section of firms’ 10-Ks; and industry best practice, discerned using the ESG risks disclosed by the majority of the industry’s largest firms. Descriptively, we document (i) considerable variation in the consistency of firms’ ESG disclosures with SASB recommendations; (ii) that firms disclose as material a large number of ESG risk factors deemed immaterial per SASB recommendations; and (iii) that firms’ disclosures of material ESG risks are more consistent with industry best practice. We find that two left-tail ESG outcomes—subsequent year ESG penalties and incidents—are predicted by firms’ material ESG risk disclosures that are consistent with industry best practice, but not those deemed as material per the SASB framework. Overall, the results suggest that for left-tail ESG events the strongest predictive ability lies within ESG topics outside of those denoted as material per SASB, and within those denoted as material per industry leader firms.
For additional information, please contact Prof. Hongkang Xu at hxu5@umassd.edu.
Contact: > See Description for contact information
Topical Areas: Faculty, Academic Affairs, Accounting and Finance, _Charlton College of Business