Bakhtiar Alrazi

The environmental disclosures of the electricity generation industry: a global perspective

The electricity generation industry has been under close regulatory and public scrutiny for decades for the significant impacts its activities have on the environment. The industry is responsible for a large proportion of greenhouse gas (GHG) emissions, which has intensified public and regulatory scrutiny of late. Therefore, electricity generation firms face immense pressure to show environmental responsibility. Firms respond with environmental disclosures in their annual reports, in stand-alone-reports, and on websites. In this study, we use comprehensive disclosure indices to measure the quality (or comprehensiveness) of the CO2 emissions related disclosure and the overall environmental disclosure of 205 electricity generation firms in 35 countries. We find that firms in countries with a high commitment towards the environment and a carbon emissions trading scheme (measures of social concern for environmental protection and emissions), are likely to disclose more comprehensive environmental information. In addition, we find that firm size, age of the assets, listing status, and media exposure influence disclosure. Environmental performance, measured by CO2 emissions, is not significantly related to environmental disclosure among our sample firms. The theoretical implication of these findings is that social beliefs (that are different in different countries) prompt a legitimating disclosure response from firms that is not significantly affected by their performance against that social belief.

An Exploratory Study on Water Reporting among Top Malaysian Public Listed Companies

Abstract Climate change has brought a significant impact on the availability of water resources. This problem is further intensified by the increasing cases of water pollution affecting both the volume and quality of water. The water rationing exercise as currently being implemented in certain major cities in Malaysia would be a good example to demonstrate the severity of the issue. This has made business entities at the center of discussion as the way they withdraw, use, and discharge water impact significantly on the water resources availability and quality. Motivated by the opportunity accounting system could potentially offer to mitigate this issue, the present study aims to explore the extent and quality of water reporting among the top 10 Malaysian public listed companies based on market capitalization and water risk profile. By content analyzing the companies’ annual report, the findings show that water-related disclosure is still fairly low among the ten companies with most of the information score only ‘1’ in terms of quality. While findings the exact factors leading to these findings is beyond the scope of this study, the fact that this issue is currently being discussed at international level and the companies are sharing this natural resources with the society, the need for water-related disclosure is still there if the companies want to legitimize their position among the society. It is the role of the regulators to facilitate provision of such information without compromising the need of various parties including the companies.

A Comparative Analysis of Carbon Reporting by Electricity Generating Companies in China, India, and Japan☆

Abstract This study investigates the carbon (or greenhouse gas emissions, GHG) reporting of electricity generating companies inthe three top carbon (GHG) emitting countries in Asia, namely China, India and Japan.Using the disclosure index adapted from Choi et al. (2013) on the most recent annual reports, stand-alone sustainability reports, and corporate websites, the study finds that 45 companies (out of 90) made some form of carbon disclosure.Japan leads the sample with 60% of reporting companies, followed by China (58%), and India (41%). The average of disclosure score is 10.50% indicating a low level of disclosure. Most of the disclosures are pertaining to climate change risks and actions taken (40% of the sample companies), detailed plans or strategies to reduce GHG emissions (30%), and total GHG emissions (23%).Considering that electricity generating companies are the major contributor to carbon emissions build-up and the prospect of corporate disclosures in reducing carbon emissions, such a low disclosure by companies in the top emitting countries could lead the mission to reduce global emissions by 2020to crumble.

Institutional Governance Framework for Determining Carbon-related Accounting Practices: An Exploratory Study of Electricity Generating Companies in Malaysia

Electricity industry is the major contributor of the global carbon emissions which has been scientifically identified as the main cause of climate change. With the various initiatives being implemented at the international, national, and industry levels, companies in the electricity industry are currently facing immense pressure from various stakeholders to demonstrate their policies, initiatives, targets, and performance on climate change. Against this background, accounting system is argued to be able to be play important roles in combating climate change. Using institutional governance as the underlying framework, we have identified several governance mechanisms as the determining factors for companies to have a systematic accounting system related to carbon emissions. The factors include environmental management system certification, environmental organization, publication of stand-alone sustainability reports, the use of GRI guidelines, environmental strategic planning, governance quality, and participation in CDP surveys and emissions trading scheme. We explored this issue in the context of major electricity generating companies in Malaysia and found that except for certified environmental management system, the other governance mechanisms are still lacking. The findings suggest that companies in Malaysia, in particular, from the electricity industry are not well prepared in facing risks related to climate change.

The awareness and utilisation of Tax Investment incentives on environmental protection activities

This study investigates the awareness and utilisation of the Tax Investment Incentives (TII) under Income Tax Act 1967 (ITA) and the Promotion of Investment Acts 1986 (PIA) on Environmental Protection Activity (EPA). Additionally, the study examines the type of EPA undertaken by Malaysian Public Listed Companies. Data are obtained using self-administered questionnaires which were mailed directly to the respondents who were Chief Financial Officers, accountants, tax managers or Board of Directors. The study discovered that 17(27%) companies were involved in waste recycling; 15(24%) in storage, treatment and disposal of toxic and hazardous waste; and 11(18%) in waste water management. The descriptive analysis reveals that 48(77%) out of the 62 companies were aware of the availability of TII on EPA. Surprisingly, only four companies ever utilised the TII on EPA which includes Investment Tax Allowance, Accelerated Capital Allowance, Reinvestment Allowance and Double Deduction. The utilisations are based on their capital expenditure on plant and equipment, motor vehicle and industrial building.