Carbon media legitimacy in UK companies: actions or words?

What is it about?

Climate change is one of the most urgent concerns facing society. Since 1880 the earth’s average temperature has been rising. Also, significant increase is expected in atmospheric carbon concentration and surface temperature. Therefore, it is not surprising that social and political concerns about carbon footprint-related issues have been heightened over the last decade as evidenced by the introduction of carbon tax and carbon offset schemes, emissions trading, voluntary initiatives such as Carbon Disclosure Project, and so forth. Companies are key contributors to carbon emissions, and at the same time, they are expected to reduce their emissions and hence the negative impact on climate and global temperature. This is important for both society and sustainable development. In this regard, there has been an increased pressure from different parties on companies to manage and disclose their carbon emissions. In response to such pressures, companies are attempting to reduce their emissions, develop different strategies, and voluntarily disclose carbon information. However, variations exist among companies’ strategies/activities, which makes it difficult to assess how well they are doing in relation to carbon emissions. Thus, reporting on companies’ activities and their impact on carbon emissions is key for decision making by the users of carbon information such as regulators, environmental groups, and investors. The uncertainty surrounding carbon reduction activities and emissions measurements may encourage firms to use different mechanisms, such as voluntary carbon disclosure, to respond to the ever-increasing environmental concerns and maybe to protect/enhance their legitimacy. Legitimacy refers to the social entities endorsement of companies, such as media. This triggered our interest to investigate whether carbon performance (i.e. level of carbon emissions) and disclosure are reflected in firms’ carbon (media) legitimacy using a sample of UK companies. We view carbon legitimacy to be grounded in the public media role in constructing social perception. The UK represents an interesting context because it is seen as a leading country in tackling climate change and global warming. We argue that companies may be motivated to voluntarily disclose carbon information to gain, maintain and/or repair their legitimacy without real intentions to improve carbon emissions. We found that voluntary carbon disclosure plays a role in constructing new and different image of corporate activities, which may not ensure sustainability. The results showed a certain degree of naivety on the part of the media in evaluating corporate carbon behaviour, since it values companies’ carbon disclosure more than underlying carbon performance. Such media behaviour may hinder future improvement in firms’ carbon performance. Thus, we argue that the media should pay close attention to companies’ underlying carbon performance when evaluating their carbon behaviour. Our findings could also be of interest to policy-makers as they show that the current carbon disclosure policy in the UK does not address the heart of climate change and global warming, because companies can enhance their legitimacy by disclosing more information (irrespective of its quality). Protecting environment is extremely important and carbon disclosure ought to be about transparent accountability not “greenwashing”. Hence, tougher regulations are needed on the part of voluntary carbon disclosure. Further standardisation of voluntary carbon disclosure by regulatory bodies may also help the users of carbon information to improve their capability to interpret such information.

Featured Image

Photo by Sandy Millar on Unsplash

Photo by Sandy Millar on Unsplash