Ngoc Tien Nguyen

A number of studies in environmental disclosure have suggested that corporates accountable for environmental responsibility practice have lower cost of capital. However, this relationship has not yet been discovered in Vietnam. The purpose of this study is to examine the relationship between environmental disclosure and the equity cost of 115 non-financial companies listed on Vietnamese stock market from 2014 to 2017 with 460 observations. This study uses the panel data regression model (the fixed effects model (FEM) and the random effects model (REM)) to assess the impact of environmental disclosure on the equity cost of listed companies in Vietnam. Content analysis method according to GRI guidelines is used to measure the level of the environmental responsibility practice and Easton’s model (2004) is used to estimate firms’ ex ante cost of equity. The research results show that the level of environmental information disclosure of listed companies in Vietnam is not high and there is a negative relationship with statistical significance between the environmental disclosure and cost of equity of listed companies in Vietnam. The findings suggest that environmental practice can be profitable and beneficial to Vietnamese listed companies. Therefore, companies in Vietnam need to change their awareness of social and environmental responsibility practices. This study also shows that the suitable model for listed companies in Vietnam is the FEM.

The environmental information disclosure of enterprises listed on Vietnam’s stock market has been mandated by the Ministry of Finance of Vietnam according to Circular No. 155/2015/TT_BTC. Therefore, enterprises need to be responsible for announcing and interpreting financial and non-financial information about the environment to meet the needs of the Government and stakeholders. However, the level of environmental information disclosure depends on their business, company characteristics, compliance of the board of management, etc. This paper investigates and assesses the level of environmental information disclosure of the listed companies on the stock market in Vietnam. The study was conducted with 170 listed companies on the Hanoi Stock Exchange (HNX) and Ho Chi Minh City Stock Exchange (HOSE) through descriptive statistics and value testing methods and an in-depth interview. The research results have shown that in Vietnam, the level of enterprises announcing environmental information disclosure is still low. For example, materials and construction industry, food and beverage industry have less than 55% of enterprise disclosing environmental information. At the same time, the enterprises from environmentally sensitive sectors such as materials and construction, electricity, petroleum, gas, chemicals, etc., have more environmental information disclosure than other industries, and the environmental information published only focuses on the environmental debt, the amount of resources consumed, the number of environmental violations, environmental policies and objectives, etc.

Type of the article: Research Article

Abstract
In developing economies with weak institutional enforcement, the dependability of financial reporting remains a significant issue for investors and regulators. This study examines the relationship between audit committee attributes and the quality of financial reporting among non-financial publicly listed companies in Vietnam, an emerging economy where the Vietnamese government officially established audit committees as a new governance structure through Enterprise Law No. 59/2020/QH14, which replaces the mostly ceremonial Supervisory Board model. A balanced panel dataset comprising 455 firm-year observations from companies listed on the Ho Chi Minh Stock Exchange and Hanoi Stock Exchange between 2018 and 2022 is utilized. A binary logistic regression model is employed to assess whether the presence and effectiveness of audit committees improve financial reporting quality, indicated by the receipt of unqualified audit opinions and the timely disclosure of financial statements. The results show a strong positive link between having an audit committee and the quality of financial reporting (odds ratio = 23.415, p < 0.001). This means that companies with a formal audit committee are about 23 times more likely to have better reporting quality. In addition, the chairperson’s professional expertise (odds ratio = 1.477, p < 0.05) and the frequency of audit committee meetings (odds ratio = 1.156, p < 0.05) both have a big effect on better reporting outcomes. These findings suggest that governance effectiveness, rather than mere formal adoption, is the primary determinant of reporting quality in weak institutional environments.