Publications

We examine misreporting of ESG information, in the context of gender pay gap reporting. The UK government requires UK employers to report gender employment ratios and pay gaps. We find that a large number of employers misreport as evidenced by their reporting a set of disclosures that in concert are mathematically impossible. We also find that a disproportionate number of employers report perfectly-balanced gender statistics, consistent with some employers intentionally misreporting as a form of ESG-washing. We find that employers involved in ESG controversies and that commit labor violations are more likely to misreport, consistent with ethical considerations affecting misreporting. Consistent with capital market and media scrutiny discouraging misreporting, public employers, employers that are the subject of an article about their gender pay gap reports, and employers that receive an ESG audit or financial audit from a big-4 auditor are less likely to misreport. Employers that misreport receive higher ESG scores and are less likely to receive negative media attention, consistent with benefits of misreporting. Our results suggest that inferences drawn from measures of ESG performance collected by second parties or on information self-reported in the presence of meaningful oversight are particularly valuable.

This paper studies the role of newspaper notices on citizen engagement. We examine a recent Florida legislation that revokes the requirement that public notices appear in newspapers and allows local governments to publish notices on their county’s website instead. We find that local governments located in counties with a public notice website significantly reduce newspaper notice after the legislation, particularly for topics that tend to encourage citizen engagement, such as public hearings, planning and zoning proposals, or upcoming elections. By contrast, we find no discernible changes in website traffic of counties’ public notice websites. Consistent with a decrease in citizen awareness of public notices in affected cities, we find a decline in public meeting attendance after the legislation. We also find an increase in the number of commercial zoning permits, consistent with reduced citizen activism against new construction. Overall, our results suggest that the removal of newspaper notices removes information about local government activities and reduces citizen engagement.