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Title: The impact of environmental disclosure on initial public offering underpricing: sustainable development in Singapore
Authors: Kang, Eugene
Lam, Nguyen Bao
Keywords: Business::General
Issue Date: 2022
Source: Kang, E. & Lam, N. B. (2022). The impact of environmental disclosure on initial public offering underpricing: sustainable development in Singapore. Corporate Social Responsibility and Environmental Management.
Journal: Corporate Social Responsibility and Environmental Management
Abstract: This study applies signaling theory to examine the impact of environmental disclosures on equity underpricing at initial public offerings (IPO) when private firms list on stock exchanges. Firms often under-price their shares to attract investors as IPOs have high information asymmetry between firms and investors. Using a linguistic technique on environmental disclosures in prospectuses from 2009 to 2019 in the Singapore Exchange, we find that disclosures with a positive tone correlate with lower underpricing, but only if these disclosures are authentic. This finding is robust to different model specifications and measurements. We provide new evidence that linguistic features, that is, tone and authenticity, interact to influence a key IPO outcome. The results suggest that investors are not easily attracted by positive disclosure tones but are also concerned with the authenticity of such disclosures. This finding informs firms and various stakeholders navigating the nascent and growing wave of sustainability reporting in Singapore.
ISSN: 1535-3958
DOI: 10.1002/csr.2342
Schools: Nanyang Business School 
School of Civil and Environmental Engineering 
Rights: © 2022 ERP Environment and John Wiley & Sons Ltd. All rights reserved.
Fulltext Permission: none
Fulltext Availability: No Fulltext
Appears in Collections:CEE Journal Articles
NBS Journal Articles

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