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Does corporate eco-innovation affect stock price crash risk?
The British Accounting Review, Volume: 53, Issue: 5, Start page: 101031
Swansea University Author: Saadia Irfan
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DOI (Published version): 10.1016/j.bar.2021.101031
Abstract
We examine the effect of corporate environmental innovation (hereafter eco-innovation) on stock price crash risk and document a significant negative association. Utilising a large sample of publicly listed U.S. firms for the period 2003 to 2017, we find that an increase in eco-innovation from the 25...
Published in: | The British Accounting Review |
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ISSN: | 0890-8389 |
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Elsevier BV
2021
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URI: | https://cronfa.swan.ac.uk/Record/cronfa67288 |
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v2 67288 2024-08-02 Does corporate eco-innovation affect stock price crash risk? 22bfa5485d1fbe647b75a8da2803a550 Saadia Irfan Saadia Irfan true false 2024-08-02 CBAE We examine the effect of corporate environmental innovation (hereafter eco-innovation) on stock price crash risk and document a significant negative association. Utilising a large sample of publicly listed U.S. firms for the period 2003 to 2017, we find that an increase in eco-innovation from the 25th to the 75th percentile is associated with 17.62% reduction in stock price crash risk. This outcome remains robust to a variety of sensitivity tests and after accounting for potential endogeneity concerns. Eco-innovative firms attract more institutional investors and equity analyst following and disclose more information leading to lower stock price crash risk. Additional tests reveal that the negative effect of eco-innovation is contingent on the political leadership's ideology and environmental sensitivity. Our paper contributes to the ongoing discourse on the costs and benefits of eco-innovation, documenting the value-enhancing perspective of eco-innovation. Journal Article The British Accounting Review 53 5 101031 Elsevier BV 0890-8389 Eco-innovation; Stock price crash risk; Information asymmetry; Political leadership's ideology 1 9 2021 2021-09-01 10.1016/j.bar.2021.101031 COLLEGE NANME Management School COLLEGE CODE CBAE Swansea University 2024-08-02T16:14:06.2892151 2024-08-02T11:02:08.1420012 Faculty of Humanities and Social Sciences School of Management - Accounting and Finance Rashid Zaman 1 Nader Atawnah 2 Muhammad Haseeb 3 Muhammad Nadeem 4 Saadia Irfan 5 67288__31042__262ce5c367434d36bc33cef691588ccc.pdf 67288.VoR.pdf 2024-08-02T16:12:50.8369997 Output 728118 application/pdf Version of Record true © 2021 The Authors. This is an open access article under the CC BY license. true eng http://creativecommons.org/licenses/by/4.0/ |
title |
Does corporate eco-innovation affect stock price crash risk? |
spellingShingle |
Does corporate eco-innovation affect stock price crash risk? Saadia Irfan |
title_short |
Does corporate eco-innovation affect stock price crash risk? |
title_full |
Does corporate eco-innovation affect stock price crash risk? |
title_fullStr |
Does corporate eco-innovation affect stock price crash risk? |
title_full_unstemmed |
Does corporate eco-innovation affect stock price crash risk? |
title_sort |
Does corporate eco-innovation affect stock price crash risk? |
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22bfa5485d1fbe647b75a8da2803a550 |
author_id_fullname_str_mv |
22bfa5485d1fbe647b75a8da2803a550_***_Saadia Irfan |
author |
Saadia Irfan |
author2 |
Rashid Zaman Nader Atawnah Muhammad Haseeb Muhammad Nadeem Saadia Irfan |
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The British Accounting Review |
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101031 |
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10.1016/j.bar.2021.101031 |
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Elsevier BV |
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We examine the effect of corporate environmental innovation (hereafter eco-innovation) on stock price crash risk and document a significant negative association. Utilising a large sample of publicly listed U.S. firms for the period 2003 to 2017, we find that an increase in eco-innovation from the 25th to the 75th percentile is associated with 17.62% reduction in stock price crash risk. This outcome remains robust to a variety of sensitivity tests and after accounting for potential endogeneity concerns. Eco-innovative firms attract more institutional investors and equity analyst following and disclose more information leading to lower stock price crash risk. Additional tests reveal that the negative effect of eco-innovation is contingent on the political leadership's ideology and environmental sensitivity. Our paper contributes to the ongoing discourse on the costs and benefits of eco-innovation, documenting the value-enhancing perspective of eco-innovation. |
published_date |
2021-09-01T16:14:04Z |
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1806289228104990720 |
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11.0241995 |