AI-Related Disclosure in Annual Reports and ESG Rating Divergence: Evidence from Chinese A-Share Listed Firms

DOI

10.2991/978-94-6239-787-3_83How to use a DOI?

Keywords

AI-related disclosure; ESG rating divergence; annual reports; textual analysis; Chinese A-share listed firms

Abstract

This study examines whether AI-related disclosure in annual reports is associated with overall ESG rating divergence among Chinese A-share listed firms from 2014 to 2024. AI disclosure is measured as the natural logarithm of one plus the frequency of AI-related terms in annual reports, while rating divergence is measured from standardized overall ESG ratings issued by six agencies. The baseline sample contains 20,315 firm-year observations. AI_Full is positively associated with both the standard-deviation and range measures of ESG rating divergence. The result remains directionally consistent when the disclosure measure is lagged or replaced by an MD&A-based measure, when 2021–2022 observations are excluded, and after propensity-score matching and entropy balancing. Instrumental-variable estimates provide supplementary support, although city-year fixed effects substantially weaken the result. The coefficient becomes insignificant under firm fixed effects, indicating that the baseline association mainly reflects cross-sectional differences across firms. Exploratory analyses suggest that internal control quality may buffer rating divergence, while analyst attention and green innovation are positively associated with divergence; these analyses are not formal mechanism tests. Overall, more intensive AI-related disclosure is associated with greater disagreement among ESG rating agencies, but the evidence neither implies that actual AI capability increases divergence nor establishes causality.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Ziao Lan
PY  - 2026
DA  - 2026/09/29
TI  - AI-Related Disclosure in Annual Reports and ESG Rating Divergence: Evidence from Chinese A-Share Listed Firms
BT  - Proceedings of the 2026 4th International Conference on Management Innovation and Economy Development (MIED 2026)
PB  - Atlantis Press
SP  - 847
EP  - 863
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6239-787-3_83
DO  - 10.2991/978-94-6239-787-3_83
ID  - Lan2026
ER  -