Description and measurement of the study variables
| Variables | Description and measurement |
|---|---|
| Dependent variable | |
| Environmental management practices disclosure level (EDL) | It is calculated by summing up 31 items. A score of 1 is assigned if the firm discloses its involvement in environmentally friendly activities during a specific year, while a score of 0 is given if it does not (Aslam et al., 2021) |
| Independent variables | |
| Environmental performance (CCP) | Refinitiv score that assesses a firm’s commitment and effectiveness in reducing corporate emissions in its production and operational activities relative to its industry (Aliani, 2023) |
| Carbon dioxide emissions (CO2E) | Natural logarithm of total carbon emission (Hassan and Romilly, 2018) |
| Moderator variable | |
| Corporate Governance (CG) | Refinitiv corporate governance score (Bătae et al., 2021; Widyawati, 2021) |
| Board Size (BSZ) | The total number of board members at the end of the financial year (Matuszak et al., 2019; Rashid, 2020) |
| Number of Board Meetings (NBM) | The number of board meetings during the year (Ronoowah and Seetanah, 2023) |
| Board Gender Diversity (BGD) | Percentage of females on the board (Nuhu and Alam, 2024) |
| Board Independence (BIN) | The percentage of independent directors on the board (Hussain et al., 2018) |
| CSR Sustainability Committee (CSR) | A dummy variable equal to 1 if a company has a CSR committee, and 0 otherwise (Giannarakis, 2014; Hussain et al., 2018) |
| CEO chairman duality (CEO) | A dummy variable equal to 1 if the CEO simultaneously chairs the board, and 0 otherwise (Janggu et al., 2014) |
| Audit Committee Independence (ACI) | Percentage of independent board members on the audit committee (Wang and Sun, 2022) |
| Control variables | |
| Leverage (LV) | Total debt divided to total assets (Kamel and Awadallah, 2017) |
| Financial distress (Zscore) | The Altman Z-Score is used to measure the financial health of a company. It is a dummy variable with a value of 1 assigned to a score below 1.88, and 0 otherwise (Zahid et al., 2023) |
| Financial Performance (FP) | Measured by Tobin’s Q, which is calculated as the market value of equity plus the book value of debt to the book value of assets (Shahwan, 2015) |
| Company Size (CSZ) | The natural logarithm of total assets (Nuskiya et al., 2021) |
| Current Ratio (CR) | Current assets to current liabilities (Zhang et al., 2022) |
| Sector | A dummy variable to control for sector effect |
| Reform | A dummy variable with a value of 1 assigned to the years 2018–2023, and 0 otherwise |
| Variables | Description and measurement |
|---|---|
| Dependent variable | |
| It is calculated by summing up 31 items. A score of 1 is assigned if the firm discloses its involvement in environmentally friendly activities during a specific year, while a score of 0 is given if it does not ( | |
| Independent variables | |
| Refinitiv score that assesses a firm’s commitment and effectiveness in reducing corporate emissions in its production and operational activities relative to its industry ( | |
| Natural logarithm of total carbon emission ( | |
| Moderator variable | |
| Refinitiv corporate governance score ( | |
| The total number of board members at the end of the financial year ( | |
| The number of board meetings during the year ( | |
| Percentage of females on the board ( | |
| The percentage of independent directors on the board ( | |
| A dummy variable equal to 1 if a company has a CSR committee, and 0 otherwise ( | |
| A dummy variable equal to 1 if the CEO simultaneously chairs the board, and 0 otherwise ( | |
| Percentage of independent board members on the audit committee ( | |
| Control variables | |
| Total debt divided to total assets ( | |
| The Altman Z-Score is used to measure the financial health of a company. It is a dummy variable with a value of 1 assigned to a score below 1.88, and 0 otherwise ( | |
| Measured by Tobin’s Q, which is calculated as the market value of equity plus the book value of debt to the book value of assets ( | |
| The natural logarithm of total assets ( | |
| Current assets to current liabilities ( | |
| A dummy variable to control for sector effect | |
| A dummy variable with a value of 1 assigned to the years 2018–2023, and 0 otherwise | |
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