A Study Of Relationship Between Environmental Performance,Corporate Governance And Corporate Value

With the rapid development of global economy, environmental issues areincreasingly becoming prominent. Especially in recent years, more and moreenvironmental incidents occur in China and thus become increasingly serious, whichattracts the government,consumers and enterprises’attention. So, in the backgroundof sustainable development, does improving enterprise environmental performancehelp to improve its value? If so,what is the relationship between the above two? Ifthe performance depends on enterprise’s attitude to the environment as well asmanagement activities undertaken and achieved by managers, board andshareholders,who directly affects the specific measures and the developmentdirection, then how does the enterprise structure influence the enterprise value viaenvironmental performance of it? The three factors mentioned concern theimprovement of the ecological environment, sustainable development of enterprise’seconomy, and internal corporate governance.This thesis first reviews the literature concerning the three factors researchrelation at home and abroad, combes the theoretical basis of environmentalperformance,including corporate social responsibility theory, environmentalaccounting theory,the theory of sustainable development, infrastructure asymmetricinformation theory and agency theory, the value of the company ’s environmentalperformance impacting mechanism and so on, and lays a theoretical foundation.Secondly, the domestic and foreign environmental performance evaluationcriteria and methods are also combed in order to provide a certain basis for theevaluation of environmental performance indicators. Then,China’s chemical industryfrom the year2010to2012listed companies are selected as the research object,sewage charges, costs of energy consumption, environmental investment andenvironmental subsidies disclosed in the annual report being environmentalperformance index. From the empirical results, it is found that the short-term sewagecharges and company value change in the same direction, which shows thedevelopment of the enterprise is based on the cost of environmental pollution. So doenergy consumption costs and company value, environmental investment andcompany value. The former indicates that social benefit from the consumption of energy can sufficiently cover environmental pollution; the latter shows thatinvestment in environmental protection and enhanced ability to various types ofpollutants do not make environment deteriorate while keeping enterprise developmentrapid. Environmental subsidies and company value with no significant correlationindicates few companies are able to get subsidies to reduce the company’senvironmental expenditures or increase enterprise value because of strict applicationof environmental subsidies.Thirdly,from the perspective of the ownership structure and boardcharacteristics,we discuss how the environmental performance affects enterprisevalue.Then, we select the nature of property rights, the proportion of independentdirectors and the environmental performance to discuss the critical issue. Theregression result shows that the nature of property rights and sewage charges andTBQ regression coefficient are negatively correlated, significantly inhibiting thesewage charges positive effect for TBQ.Compared with non-state-owned enterprises,state-owned companies are more willing to comply with laws and regulations, moreactively carry social responsibility, pay more attention to long-term development ofenterprises and to implementation of good environmental management system.State-owned companies will bring long-term value to enhance the formation of apotential competitive advantage by improving the environmental performance. Thenature of property rights and energy consumption costs regression coefficient are notsignificant tested. This means that the actual control does not reduce the enterprisevalue due to excessive energy consumption, and also means that the masses would bebeneficiary. The nature of property rights and environmental protection investmentand cross-regression coefficients environmental subsidies do not pass the significancetest,indicating both state-owned enterprises and non-state-ownedenterprises’awareness of investment in environmental protection are not strongenough. The strict environmental subsidies audit mechanism results in the failure toapply the full amount of funds of pollution projects. Cross regression coefficientshave failed to pass the test. This suggests that,due to the special nature of independentdirectors nomination, it does not play its due functions, and can not actively promoteor inhibit the enterprise value by improving the environmental performance.Finally, based on theoretical analysis and empirical results, consideringChina ’s national conditions,two pieces of suggestion are put forward from macro and micro aspects,namely,municipal government and other relevant departments’spolicies are to supervise enterprise governance environment;the other is to strengthenthe companies to improve their internal governance structures in order to promote thecorporate environmental performance and enterprise value.