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September 10, 2025Business Strategy and the Environment

Corporate Environmental Performance and Stock Price Synchronicity: Examining Industry Sensitivity and Disclosure Regimes in Stakeholder‐Oriented Markets

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Authors

IKIshwar KhatriNorwegian University of Science and TechnologyPBPhuong BuiHo Chi Minh City International UniversityKKKhine KyawNorwegian University of Science and Technology

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Implication

This analysis finds that higher corporate environmental performance boosts stock price synchronicity in stakeholder-oriented markets, contrasting with mandatory disclosure effects.

Key Points

  • Higher corporate environmental performance generally increases stock price synchronicity, supporting the noise reduction hypothesis.
  • Under mandatory reporting, corporate environmental performance decreases stock price synchronicity, aligning with the idiosyncratic information view.
  • Industry-level analysis reveals sectoral heterogeneity in the relationship between environmental performance and stock price behavior.
  • Robust findings using methods like IV-2SLS and Difference-in-Differences emphasize the importance of the firm's information environment.

Cite This Study

Khatri et al. (2025) studied this question.

synapsesocial.com/papers/68c1aab854b1d3bfb60e2bdahttps://doi.org/10.1002/bse.70125
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Also Consider

Synapse has enriched one closely related paper. Consider it for comparative context:

  1. 1The Uneven Returns of Transparency in Voluntary Nonfinancial Disclosures2022 · 17 citations