Carbon reporting: does it matter?

Haigh, Matthew; Shapiro, Matthew

Abstract

This paper identifies the significance of carbon emissions reporting for investment bankers at selected financial institutions in the USA, Europe and Australia. Carbon emissions reporting methods as used by firms are identified using desk research. A proposal from a non-state actor called the Climate Disclosure Standards Board for general-purpose carbon emissions reporting is assessed. We find that environmental investing for well-diversified investors constitutes a discourse of the imaginary. Financialised constructs have been used to represent heavier polluters as superior ‘carbon performers’ (the imaginary), while reported variations in industrial carbon emissions levels have been ignored in asset allocation decisions (the actual).

Environmental investing is conditioned by four factors:
- exclusion of carbon emissions in constructions of firm value;
- diverse methods used by firms to calculate, measure and report carbon emissions;
- the appropriate venue for such reporting; and
- the quantum of data contained therein.

Risk assessment is likely to be erroneous if using measures which deflate carbon emissions by firms’ revenues. This may not matter much as carbon reports in the hands of investors are linked to an imaginary signification more so than actual portfolio allocation.

Citation

Haigh, M., & Shapiro, M. (2013). Carbon reporting: does it matter?. Accounting, Auditing and Accountability Journal, 25(1), 105-125. https://doi.org/10.1108/09513571211191761

• Journal Article Type: Article
• Publication Date: Jan 1, 2013
• Deposit Date: Jan 3, 2012
• Journal: Accounting, Auditing and Accountability Journal
• Electronic ISSN: 0951-3574
• Publisher: Emerald
• Peer Reviewed: Peer Reviewed
• Volume: 25
• Issue: 1
• Pages: 105-125
• DOI: https://doi.org/10.1108/09513571211191761
• Publisher URL: http://www.emeraldinsight.com/fwd.htm?id=aob&ini=aob&doi=10.1108/09513571211191761