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Carbon Disclosure and Financial Performance: UK Environmental Policy

Lookup NU author(s): Khaled Alsaifi Alsaifi, Professor Marwa ElnahassORCiD, Dr Aly SalamaORCiD



This is the authors' accepted manuscript of an article that has been published in its final definitive form by Wiley , 2020.

For re-use rights please refer to the publisher's terms and conditions.


The outcome of carbon disclosure, the importance of which has grown remarkably in recent years to become a strategic decision-making issue for organisations in today’s competitive environment, is a subject of lively debate but remains under-researched in the environmental accounting literature. This study is motivated by this research gap and the growing interest in assessing the financial consequences of corporate involvement in climate change beyond regulatory compliance, as evidenced by firms’ voluntary participation in the Carbon Disclosure Project (CDP). Using the resource-based view (RBV) of the firm as a theoretical framework and linking it to carbon disclosure through CDP, we conceptualise and empirically investigate the impact of adopting proactive carbon management policies and communicating them to stakeholders, focusing on the financial performance of the top FTSE350 companies between 2007 and 2015. By developing a comprehensive financial performance index and controlling for several firm characteristics, we find strong evidence that voluntary carbon disclosure is positively associated with firm financial performance. The findings in this paper provide new insights and policy implications for managers, financial stakeholders, and regulators.

Publication metadata

Author(s): Alsaifi K, Elnahass M, Salama A

Publication type: Article

Publication status: Published

Journal: Business Strategy and the Environment

Year: 2020

Volume: 29

Issue: 2

Pages: 711-726

Print publication date: 01/02/2020

Online publication date: 17/12/2019

Acceptance date: 14/11/2019

Date deposited: 16/11/2019

ISSN (print): 0964-4733

ISSN (electronic): 1099-0836

Publisher: Wiley


DOI: 10.1002/bse.2426


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