Environmental Incidents and the Market Value of Firms: An Empirical Investigation in the Chinese Context
研究中国制造业企业环境事件公告对股票市场的负面影响，发现政府持股和社会责任认可可减轻冲击，而个人政治关联反而加剧冲击，且事件会波及海外客户的市场价值。
We examine firms listed on the Shanghai/Shenzhen Stock Exchange to investigate stock market reactions to 294 Chinese manufacturing firms involved in 618 environmental incidents between 2006 and 2013. Through our event studies, we find empirical evidence of a significantly negative stock market reaction to announcements of environmental incidents. Our empirical analysis reveals that Chinese firms with a higher government share (of ownership) and recognition of social responsibility tend to be less affected by such incidents; however, Chinese firms with stronger personal political ties (i.e., top management teams or board members with concurrent or prior government appointments) are actually affected more when environmental incidents occur. Moreover, environmental incidents caused by Chinese firms can have a significantly negative impact on the market value of their overseas customers. The online appendix is available at https://doi.org/10.1287/msom.2017.0680 .