The bright side of corruption control in the age of press freedom: Evidence from corporate environmental performance around the world

Abstract

Corruption is a severe problem, and social ethics significantly impact all societies. It is a global phenomenon defined broadly as using public power to benefit a private interest. It is a complex and multifaceted concept with numerous and significant economic and environmental implications. This paper examines the impact of control of corruption on corporate environmental performance. Using a large sample of 19,666 firm-year observations of 2,063 unique firms in 28 countries between 2003 and 2018, we find that control of corruption has a significant and positive impact on corporate environmental performance. Our findings remain econometrically sound even after controlling for the corruption-environmental performance relationship's inherent endogeneity and we also examine the cross-sectional analysis for the role of press freedom in our research. We provide evidence that press freedom strengthens the beneficial impact of corruption control on corporate environmental performance.