Construct Validation and Empirical Analysis of Carbon Accrual Manipulations in High-Emission Firms

• Abiodun Okunola

  Ladoke Akintola University Technology

  Author

Corporate carbon disclosures increasingly inform capital allocation and regulatory decisions, yet the construct validity of measures used to detect manipulation in these disclosures remains largely unexamined. This study addresses this gap by developing and validating a Carbon Accrual Manipulation (CAM) construct for high-emission firms, drawing on the conceptual foundation established in recent greenwashing measurement research (Okeke, 2026; Okeke & Rahim, 2026). Using a sample of 847 firm-year observations from carbon-intensive industries across 2018–2024, I apply confirmatory factor analysis and structural equation modeling to validate the CAM construct, then compare its predictive performance against established accrual-based earnings management models. The validated CAM framework demonstrates strong psychometric properties (CFI = 0.94, RMSEA = 0.06) and achieves 89.4% classification accuracy in identifying firms with material carbon disclosure discrepancies, substantially outperforming traditional discretionary accrual models (76.2%). The analysis reveals that carbon intensity, regulatory scrutiny, and short-term incentive structures constitute the primary predictors of CAM, with political cost pressures emerging as the dominant mechanism. These findings provide researchers and regulators with a construct-valid instrument for detecting carbon-related disclosure manipulation and extend political cost theory to the domain of non-financial reporting.

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Copyright (c) 2026 Abiodun Okunola (Author)

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