The Relationship Between Environmental Accounting Disclosure and Financial Performance and Heterogeneity Analysis: Evidence From Chinese Pharmaceutical Manufacturing Industry

Abstract

Previous empirical evidence provides mixed results on the relationship between the level of environmental disclosures and corporate financial performance. We revisited this relationship using a more rigorous research design with a mediator + moderator model, as well as heterogeneity analysis and robustness tests. By introducing two variables, financial constraints and media attention, the changes in the relationship are examined in terms of mediating and moderating effects, respectively. Meanwhile. By introducing heterogeneity analysis, we can more accurately understand the differences within the data, select appropriate models and methods, and thereby enhance the reliability and interpretability of the research results. Through robustness tests, we can demonstrate the reliability of the conclusions under different circumstances, which in turn strengthens the persuasiveness of the research findings. The study highlights the necessity of enhancing environmental accounting disclosure by Chinese firms and strategically leveraging the same to boost their financial performance. The empirical analysis data in this paper are derived from the panel data of 281 Chinese pharmaceutical listed companies from 2010 to 2023.