The Impact of Environmental Key Audit Matters on Corporate Carbon Emissions: Based on the Mediating Effect of Green Technology Innovation

In 2017, China implemented new auditing standards, requiring listed companies to disclose key audit matters. This paper focuses on the information transmission effect of key audit matters and explores whether key audit matters related to the environment can have a deep impact on corporate environmental governance. Specifically, taking China’s A-share listed companies from 2016 to 2021 as samples, we test the governance effect of disclosure of corporate environmental key audit matters on corporate carbon emissions by using the difference-in-differences model and text analysis method, taking the new audit standards requiring enterprises to disclose key audit matters as exogenous impact. We found that, compared with companies that never disclose environmental key audit matters, companies that disclose environmental key audit matters can significantly curb corporate carbon emissions. Second, the environmental key audit matters reduce corporate carbon emissions by promoting corporate green technology innovation. Third, the more detailed and comprehensive the disclosure of environmental key audit matters, the stronger the inhibitory effect on corporate carbon emissions. Fourth, the governance effect of environmental key audit matters on carbon emissions is more pronounced with stronger supervision from institutional investors and analysts. Fifth, through the analysis of macro environmental factors, we found that in regions with weaker government environmental regulation, higher regional green innovation ability, and higher marketization level, environmental key audit matters have a stronger inhibitory effect on corporate carbon emissions. In addition, we analyzed the characteristic factors of enterprises and found that in high-tech industries and enterprises with high green awareness of executives, the environmental key audit matters have a stronger role in promoting corporate carbon emissions. Our findings have significant implications for examining the environmental governance effects of key audit matters.