The market valuation of environmental capital expenditures by pulp and paper companies

The objective of this study is to examine the market valuation of environmental capital expenditure investment related to pollution abatement in the pulp and paper industry. The total environmental capital expenditure of $8.7 billion by our sample firms during 1989-2000 supports the focus on this industry. In order to be capitalized, an asset should be associated with future economic benefits. The existing environmental literature suggests that investors condition their evaluation of the future economic benefits arising from environmental capital expenditure on an assessment of the firms' environmental performance. This literature predicts the emergence of two environmental stereotypes: low-polluting firms that overcomply with existing environmental regulations, and high-polluting firms that just meet minimal environmental requirements. Our valuation evidence indicates that there are incremental economic benefits associated with environmental capital expenditure investment by low-polluting firms but not high-polluting firms. We also find that investors use environmental performance information to assess unbooked environmental liabilities, which we interpret to represent the future abatement spending obligations of high-polluting firms in the pulp and paper industry. We estimate average unbooked liabilities of $560 million for high-polluting firms, or 16.6 percent of market capitalization.

The effect of provocation in the form of mild erotica on attitude to the ad and corporate image: Differences between cause-related and product-based advertising

Provocative advertising is characterized by a deliberate attempt to gain attention through shock. This research investigates the reactions of individuals to a provocative appeal for a cause as opposed to a provocative advertisement for a standard consumer product, using mild erotica as the element of provocative imagery. An experiment using 391 adult subjects was conducted, and two analyses were performed. The first examined the effect of stimulus type (mildly erotic/nonerotic) by product category (cause appeal/consumer product) on attitude to the ad. The second examined the effect of stimulus type (mildly erotic/nonerotic) by cause (AIDS [acquired immunodeficiency syndrome]/SIDS [sudden infant death syndrome]) on corporate image. Both analyses also included gender as a third independent variable. The results suggest that people prefer mildly erotic ads generally, that an organization using mild erotica in appeals for a cause will be viewed more favorably where the erotica is congruent with the cause, and that women may be more responsive to mild erotica in cause appeals than are men.

Changes in neighborhood walking are related to changes in perceptions of environmental attributes

Background: Several studies have found significant cross-sectional associations of perceived environmental attributes with physical activity behaviors. Prospective relations with environmental factors have been examined for vigorous activity, but not for the moderate-intensity activities that environmental and policy initiatives are being designed to influence. Purpose: To examine prospective associations of changes in perceptions of local environmental attributes with changes in neighborhood walking. Methods: Baseline and 10-week follow-up telephone interviews with 512 adults (49% men). Results: Men who reported positive changes in aesthetics and convenience were twice as likely to increase their walking. Women who reported positive changes in convenience were more than twice as likely to have increased their walking. There were contrasting findings for men and women who reported traffic as less of a problem: Men were 61% less likely to have increased walking; however women were 76% more likely to have done so. Conclusions: Further studies are needed to determine the possibly causal nature of such environment-behavior relations and to elucidate relevant gender differences. Such evidence will provide underpinnings for public health initiatives to increase participation in physical activity.