Carbon Emission Disclosure, Profitability, and Firm Value: Evidence from Dual Banking Systems Globally

Puspitasari, Novi; Korina, Asa Prayarsni; Khairunnisa, Shafira; Kostak, Nurcan; Husena, Akbar Fathoni

doi:10.22059/ijms.2026.402753.678052

Carbon Emission Disclosure, Profitability, and Firm Value: Evidence from Dual Banking Systems Globally

Articles in Press

Document Type : Research Paper

Authors

Novi Puspitasari ¹

Asa Prayarsni Korina ²

Shafira Khairunnisa ³

Nurcan Kostak ⁴

Akbar Fathoni Husena ⁵

¹ Department of Management, Faculty of Economics and Business, Universitas Jember

² Bina Sehat Hospital

³ Department of Business Administration, Faculty of Social and Political Science, Universitas Mulawarman

⁴ Sakarya University Business School Business Administration Department, Sakarya, Türkiye

⁵ Department of Management, Faculty of Economics and Business, Universitas Jember, Indonesia

10.22059/ijms.2026.402753.678052

Abstract

Carbon Emission Disclosures (CED) are crucial to the banking sector, as they support financing for industrial sectors that contribute to global carbon emissions. Therefore, disclosing carbon emissions is crucial to demonstrate a bank's commitment to sustainability, transparency, and climate risk management. The purpose of this study is to examine the relationship between carbon emission disclosure (CED) and firm value (FV) in the banking sector and to investigate whether profitability, measured by net profit margin (NPM) and return on equity (ROE), moderates this relationship. The study also considers firm size, firm age, and bank type as control variables in Islamic and conventional banks in Asia and Africa. The study looks at both conventional and Islamic banks. This study uses a moderated panel regression with bank and year fixed effects, with standard errors clustered at the bank level. The analysis uses purposive sampling of Islamic and conventional banks for 2019–2023, drawn from the OSIRIS database. The final dataset contains 263 bank-year observations from 97 banks in Asia and Africa. The fixed-effects results indicate that CED has no statistically significant effect on firm value. Neither NPM nor ROE significantly moderates the relationship between CED and firm value. The results remain unchanged after controlling for country-year heterogeneity. Firm size and firm age are not statistically significant in the bank fixed-effects specification.

Keywords

Carbon Emission Disclosure

Carbon Emission, Firm Value

Financial Performance

Dual Banking System

Subjects