What Gets Measured, Gets Managed: The Role of Sustainability Assurance in Green Transformation

Sustainability assurance (SA), an independent third-party evaluation aimed at enhancing the credibility of corporate sustainability disclosure, plays a vital role in fostering corporate green transformation. This paper systematically examines the impact of SA on corporate green transformation and th...

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Bibliographic Details
Published in:Sustainability 2024-09, Vol.16 (18), p.8163
Main Authors: Xia, Xiuhong, Gao, Sifan, Cheng, Hanlu
Format: Article
Language:English
Subjects:
Assurance services
Auditing
Behavior
Capital markets
Capital shortages
Corporate sustainability
Economic activity
Energy consumption
Environmental aspects
Evaluation
Externality
Literature reviews
Payback periods
Quality standards
R&D
Ratings & rankings
Reputations
Research & development
Stakeholders
Sustainability reporting
Third party
Citations: Items that this one cites
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Summary:Sustainability assurance (SA), an independent third-party evaluation aimed at enhancing the credibility of corporate sustainability disclosure, plays a vital role in fostering corporate green transformation. This paper systematically examines the impact of SA on corporate green transformation and the mechanisms through which it operates, using data on SA reports and green patents from A-share listed companies in China between 2010 and 2022. The findings reveal that SA significantly promotes corporate green transformation, particularly when conducted in accordance with standard ISAE 3000. Mechanism analysis indicates that SA facilitates green transformation by reducing the cost of credit and promoting risk-taking behaviors. Heterogeneity analysis further demonstrates that the positive effects of SA on green transformation are more pronounced in heavily polluting and competitive industries as well as in firms with weaker internal and external governance. This study not only underscores the beneficial impact and underlying mechanisms of SA on corporate green transformation but also contributes to the broader literature on the drivers of corporate green transformation.
ISSN:2071-1050
2071-1050
DOI:10.3390/su16188163