A system dynamic analysis of corporate carbon disclosure in China

Abstract Carbon disclosure has become an important bridge for businesses and the public to interact positively in addressing climate change. Existing research has already answered which factors affect corporate carbon disclosure, but has not yet described the interaction between multiple influencing factors and the entire process of corporate carbon disclosure. This study constructed the system dynamics model of corporate carbon disclosure based on demand and supply of information, trying to explore the process of corporate carbon disclosure and the influencing mechanism of influencing factors. The results demonstrate that information asymmetry is a prerequisite for corporate to disclose carbon information. The motivation for the company to disclose carbon information mainly stems from the information needs of external stakeholders. Among the expected impacts of the government, public, and investors, carbon disclosure strategies are most affected by government expectations. Environmental supervision promotes the speed at which companies adjust the carbon disclosure level rather than the final level of carbon disclosure. The government's penalties will not change the final level and adjustment speed of carbon information disclosure. Government rewards can effectively improve the final level of corporate carbon disclosure in the future. The conclusion provides reference and guidance for regulatory authorities to further regulate corporate carbon disclosure and create a stable and transparent capital market environment.