Unpacking firm political dependence: how administrative hierarchical distance affects corporate environmental information disclosure

Fang He, Xin Miao, Christina W.Y. Wong

Research output: Journal article publicationJournal articleAcademic researchpeer-review

Abstract

This article explores the diverse response strategies concerning environmental information disclosure (EID) among firms affiliated to different political hierarchies. Drawing on resource dependence theory (RDT), we hypothesize a U-shaped relationship between a firm’s administration hierarchical distance (AHD) and its EID. The relationship is also contingent on the scope of dependence, as reflected in two resource-based components: (i) firms with or without political connections, and (ii) varying levels of corporate innovation capability. Using data from Chinese listed companies in polluting industries, we document that firms with medium AHD have the weakest EID, while firms with shorter or longer AHD exhibit higher EID to maintain institutional or gain competitive resource, respectively. This pattern is stronger for non-politically connected and low-innovation firms. Our research not only enriches RDT on corporate political strategies by unpacking firm political dependency, but also contributes to the emerging work on the pluralistic perspective on government.

Original languageEnglish
JournalJournal of Environmental Planning and Management
DOIs
Publication statusAccepted/In press - 2024

Keywords

  • administrative hierarchical distance
  • environmental information disclosure
  • innovation capability
  • political connection
  • resource dependence theory

ASJC Scopus subject areas

  • Geography, Planning and Development
  • Water Science and Technology
  • General Environmental Science
  • Fluid Flow and Transfer Processes
  • Management, Monitoring, Policy and Law

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