Causes and Consequences of Choosing Different Assurance Providers: An International Study of Sustainability Reporting

An increasing number of companies voluntary disclose information about their social and environment performance in sustainability reports. This study investigates the causes and consequences of choosing different assurance providers for companies seeking independent verification of their sustainability reports. We employ a logistical regression analysis from an international sample of 136 companies to document that companies domiciled in countries with a weaker governance system are more likely to choose a big-4 accounting firm as assurance provider. We additionally examine the association between the type of assurance provider and the quality of a sustainability assurance statement. Using a content analysis based on an existing framework (O'Dwyer and Owen, 2005), we provide evidence that big-4 accounting firms positively affect assurance quality in terms of reporting format and assurance procedures. In contrast, the quality of the recommendations and opinions in a sustainability assurance statement is positively associated with non-accounting assurance providers.