Sustainability Disclosure Quality for Investment Attraction in Resource Extraction Firms: Field Study

Abstract

The resource extraction sector occupies a highly contentious position in contemporary global economic systems, serving simultaneously as the foundational provider of raw materials necessary for the global energy transition and as a primary contributor to environmental degradation and carbon emissions. Consequently, firms operating within this sector face unprecedented pressure from stakeholders, particularly institutional investors, to provide comprehensive and high-quality sustainability disclosures. This paper presents a field study investigating the relationship between the quality of sustainability disclosures and subsequent investment attraction in resource extraction firms. Utilizing a mixed-methods approach that combines on-site field observations, interviews with corporate reporting officers, and quantitative analysis of financial and environmental data from a sample of global mining and energy corporations, this study explores how high-quality reporting mitigates information asymmetry. The research finds a robust positive association between substantive sustainability disclosures and institutional investment inflows, contrasting sharply with the negative investment reactions to superficial reporting or greenwashing. The findings suggest that investors utilize disclosure quality as a primary proxy for underlying managerial competence and risk mitigation capabilities. This study contributes to the literature on signaling theory and legitimacy theory by providing field-based empirical evidence on the capitalization of non-financial information in highly scrutinized industries.