Estrutura de capital e divulgação ambiental, social e de governança: evidências do grupo Brics

Abstract

This research aimed to analyze the effects of capital structure on environmental, social and governance (ESG) disclosure of companies belonging to the BRICS group. To this end, a descriptive, documentary research with a quantitative approach (Multiple Linear Regression) was carried out from 2015 to 2022. The study population comprised all companies listed on the Stock Exchange of the countries of the BRICS group. The sample consisted of 55 companies from Brazil, 31 from Russia, 91 from India, 284 from China and 68 from South Africa, totaling 529 companies analyzed. The dependent variables of the study refer to ESG disclosure (general, environmental, social and governance ESG). As independent variables, capital structure stands out, which was assessed using the variables: equity (Equity), total debt, short-term debt and long-term debt. Control variables relate to Return on Assets (ROA), liquidity ratio and company size. In addition, fixed controls of the sector, year and country of observations were performed. The results revealed that equity improves ESG disclosure in all dimensions analyzed (total ESG, environmental, social and governance). These findings suggest that the BRICS group companies' own resources leverage investments in activities aimed at reducing environmental impacts, environmental policies, waste management, water, (environmental) energy, carry out actions in the area of health, community work, qualification of employees, donations, diversity in the board of directors, among other social issues, as well as, they value greater tax transparency, reduction of corruption, ethical conduct, incentive remuneration policies and

separation of powers of the CEO (governance). Regarding debt, the results show that only short- term debt financing improves total, environmental and social ESG disclosure, as total debt and

long-term debt do not explain the analyzed companies' ESG disclosure. This evidence indicates that managers of BRICS companies are seeking to reduce agency costs by investing in ESG activities. Another issue worth mentioning based on the results found is that the companies analyzed are focusing on equity and short-term debt to achieve their financial and non-financial goals, which in a way limits shareholder control through of debt financing. This research contributes to the literature, as studies investigating the effects of capital structure on ESG disclosure in the national and international context are incipient. In addition, this research presents important contributions for managers, shareholders, creditors, as well as for policy makers, as the findings allow the understanding of the capital structure's potential to improve companies' ESG disclosures, which will benefit companies, government and society.