Is Environmental Reporting Practices Affecting Investors Perception? An Econometric Analysis

Abstract

In the present scenario, investors' perceptions of the firm's risk depend upon the quantity of environmental information and cost, which can affect the company's dividend per share and earnings per share. This study is an attempt to investigate the relation of higher environmental costs with the firm’s risk ability to generate revenue. The study uses panel data from selected Indian power sector companies listed on the BSE based on market capitalization from 2019 to 2023. At the outset it assesses investors' risk perception on firm's dividend per share and earnings per share using ANOVA, regression models, a correlation matrix and descriptive statistics. Our empirical results illustrate that the environmental protection cost has a significant impact on investor’s perception on performance parameters such as dividend per share and earnings per share; it suggests that an effective corporate sustainability report is required to provide basic strength to the investor which helps to evaluate the riskiness of their investments.