Assessing corporate environmental risk in China: an evaluation of reporting activities of Hong Kong listed enterprises

Due to its large population, rapid economic growth and the fragility of its environment, China is environmentally more risky than Western countries. Over time we will see tougher and better-implemented environmental regulations in China. At the same time, sound environmental management is being viewed by investors as an essential part of good corporate governance. Hong Kong listed companies have failed to provide sufficient information for investors to assess their positions with respect to environmental management. This increases their vulnerability to possible accusations of poor environmental performance. The lack of environmental activity and accountability identified amongst the companies leads us to conclude that they are taking substantial yet avoidable risks. In the short term, Hong Kong security market regulators should expedite better voluntary environmental reporting. In the long term, a fundamental reform of security regulations in partnership between regulators, professionals and listed companies should be pursued. Copyright © 2005 John Wiley & Sons, Ltd and ERP Environment.

[1]  Sumit K. Lodhia.  Accountants responses to the environmental agenda in a developing nation: An initial and exploratory study on Fiji , 2003 .

[2]  Leigh Holland,et al.  Differences in environmental reporting practices in the UK and the US: the legal and regulatory context. , 2003 .

[3]  R. Sparkes.  Socially Responsible Investment: A Global Revolution , 2002 .

[4]  Madhu Khanna,et al.  What is Driving Corporate Environmentalism: Opportunity or Threat? , 2002 .

[5]  Jacqueline Cramer,et al.  From financial to sustainable profit , 2002 .

[6]  J. Lesourd,et al.  The Environment in Corporate Management , 2002 .

[7]  B. Richardson.  Environmental Regulation through Financial Organisations, Comparative Perspectives on the Industrialised Nations , 2002 .

[8]  M. Line,et al.  The Development of Global Environmental and Social Reporting , 2002 .

[9]  G. Noci.  Environmental reporting in Italy: current practice and future developments , 2000 .

[10]  C. Deegan,et al.  THE ENVIRONMENTAL REPORTING EXPECTATIONS GAP: AUSTRALIAN EVIDENCE , 1999 .

[11]  U. Tappeiner,et al.  Some remarks on the 'System of Integrated Environmental and Economic Accounting' of the United Nations , 1999 .

[12]  Brian J. King,et al.  Fundamentals of Environmental Management , 1999 .

[13]  J. Hammitt,et al.  Risk Premiums for Environmental Liability: Does Superfund Increase the Cost of Capital? , 1998 .

[14]  Giuliano Noci,et al.  A stakeholders' view of environmental reporting , 1997 .

[15]  Pall Rikhardsson,et al.  DEVELOPMENTS IN DANISH ENVIRONMENTAL REPORTING , 1996 .

[16]  Mikael Niskala,et al.  Environmental reporting in Finland: A note on the use of annual reports☆ , 1995 .

[17]  S. Nyquist.  The legislation of environmental disclosures in three Nordic countries—a comparison , 2003 .

[18]  R. Welford.  Beyond systems: a vision for corporate environmental management for the future , 2003 .

[19]  Lars Bjørn Larsen,et al.  Strategic implication of environmental reporting , 2000 .

[20]  K. Fletcher,et al.  Environmental management and business strategy : leadership skills for the 21st century , 1999 .

[21]  B. Jaggi,et al.  Environmental performance and reporting: Perceptions of managers and accounting professionals in Hong Kong , 1996 .

[22]  C. Frost.  Discussion Of The Effects Of Accounting Diversity - Evidence From The European-Union , 1994 .

[23]  Mary E. Barth,et al.  Estimation And Market Valuation Of Environmental Liabilities Relating To Superfund Sites , 1994 .