Title: Exploring the impact of sustainability disclosure on the cost of equity capital in the hospitality and tourism industry

Authors: Antonio Salvi; Felice Petruzzella; Nicola Raimo; Filippo Vitolla

Addresses: Department of Management, University of Turin, Turin, Italy ' Department of Business Sciences, Giustino Fortunato Telematic University, Benevento, Italy ' Department of Management, Finance and Technology, LUM University, Casamassima, Italy ' Department of Management, Finance and Technology, LUM University, Casamassima, Italy

Abstract: Environmental, social and governance (ESG) disclosure has gained increasing importance in recent years due to its ability to provide an overview of sustainable business behaviour. However, despite the attention paid by investors and stakeholders to sustainability information, the hospitality and tourism (H&T) industry is not characterised by a propensity towards ESG disclosure. This circumstance may be related to the lack of awareness regarding the benefits associated with a wide dissemination of ESG information, resulting from the limited presence of academic contributions on the topic. This study aims to fill this important gap by analysing the impact of ESG disclosure on the cost of equity capital in the H&T industry. The regression analysis, conducted on a sample of 1,750 firm-year observations from 2010 to 2019, demonstrates the existence of a negative relationship between ESG disclosure and the cost of equity capital.

Keywords: sustainability disclosure; ESG disclosure; hospitality and tourism industry; cost of equity capital; COEC.

DOI: 10.1504/IJMFA.2024.137622

International Journal of Managerial and Financial Accounting, 2024 Vol.16 No.2, pp.139 - 158

Received: 13 Sep 2022
Accepted: 14 Dec 2022
Published online: 02 Apr 2024 *