The value relevance of nonfinancial disclosure: Evidence from foreign equity investment

摘要

We investigate the effect of Environmental, Social, Governance (ESG)-related disclosure on foreign investments for Indian firms where financial reporting does not provide adequate and reliable information. We show a preference of foreign investors for firms disclosing ESG-related information. Our results suggest that ESG-related disclosure is particularly useful for firms facing information problems. Finally, we report that the effect of ESG-related disclosure is lesser on domestic investors. (C) 2019 Elsevier B.V. All rights reserved.