The Effect of Mandatory ESG Disclosure Around the World

We document a significant positive effect of ESG disclosure mandates on firm-level stock liquidity. The effects are strongest if the disclosure requirements are implemented by government institutions—not on a comply-or-explain basis—and coupled with strong enforcement by informal institutions. Firms with weaker information environments benefit the most from ESG disclosure mandates. The findings are robust to different estimation methods and concerns related to the staggered introduction of the disclosure mandates. Our results support the view that ESG disclosure regulation improves the information environment and has beneficial capital market effects. Télécharger la version PDF du