Conference Programme

I develop and test a model in which regulator-verified, facility-level GHG disclosure realigns corporate incentives, shifting firms from strategic reporting toward genuine operational change. Exploiting a staggered difference-in-differences design among firms with a history of voluntary disclosure, I find that exposure to the U.S. EPA's Greenhouse Gas Reporting Program leads to a 15% reduction in total corporate emissions through firm-wide efficiency gains. These reductions emerge following the public release of verified data and extend beyond regulated facilities. To explain these real effects, I identify three mechanisms: internal attention, reflected in increased managerial focus on climate issues in earnings conference calls; external discipline, which penalizes firms with larger discrepancies between voluntary and verified disclosures through negative abnormal returns, ESG-driven capital outflows, and environmental rating downgrades; and information precision, which strengthens the market's valuation sensitivity to emissions. Disclosure generates its strongest behavioral effects when reported figures are verified against physical reality.