Biodiversity disclosure in China linked to worse analyst forecast quality

Chinese listed companies that disclose biodiversity information tend to receive less accurate analyst forecasts, according to a study published in Humanities and Social Sciences Communications. The paper, authored by Rujun Xu, Yi Zhao and Qiong Liu, reports that biodiversity information disclosure increases both analyst forecast errors and forecast dispersion, thereby reducing overall analyst forecast quality. The authors describe it as the first study to examine this relationship using evidence from Chinese listed firms.

The study also probes the mechanisms behind this effect. According to the findings, biodiversity disclosure reduces forecast quality by increasing information asymmetry between companies and external stakeholders, by enhancing uncertainty about firms’ internal operating conditions, and by raising the complexity of the textual information contained in annual reports. In other words, the added disclosures appear to make the corporate information environment harder for outside analysts to interpret rather than easier.

The paper’s heterogeneity analysis indicates that the negative effect is more pronounced in regions with high attention to local ecological civilization. At the same time, the implementation of ecological reward and punishment mechanisms can weaken the negative impact of biodiversity disclosure on forecast quality, which the authors say enhances the decision-usefulness of such disclosure to a certain extent.

The effect is also stronger among companies with environmental violations: for these firms, higher levels of biodiversity disclosure further reduce analyst forecast quality. The study positions biodiversity information as an important component of risk information and sustainable development information frameworks, noting that the rules, behaviors and quality of its disclosure have become major current research issues. As an open-access article published on 20 October 2026, the paper is being shared early as accepted, peer-reviewed research, with a final version of record to follow.

Subject of Research: The effect of biodiversity information disclosure by Chinese listed companies on analyst forecast quality

Article Title: The impact of biodiversity information disclosure on analyst forecast quality: empirical evidence from China

Article References: Xu, R., Zhao, Y., & Liu, Q. (2026). The impact of biodiversity information disclosure on analyst forecast quality: empirical evidence from China. Humanities and Social Sciences Communications. https://doi.org/10.1057/s41599-026-09462-4

Image Credits: AI Generated

DOI: 10.1057/s41599-026-09462-4

Keywords: biodiversity disclosure, analyst forecasts, forecast quality, China, listed companies, information asymmetry, annual reports, environmental violations, ecological civilization, sustainable development, impact, biodiversity