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ESG assurance in the United States

Author

Listed:
  • Brandon Gipper

    (Stanford University Graduate School of Business)

  • Samantha Ross

    (University of California College of the Law)

  • Shawn X. Shi

    (University of Washington Michael G. Foster School of Business)

Abstract

We provide the first large-sample evidence on third-party verification of firms’ environmental and social metrics in ESG reports (ESG assurance) in the United States. Focusing on the S&P 500 from 2010–2020, we document a striking increase in not only the number of firms with ESG assurance—in 2020 (2010), 76% (38%) of the S&P 500 had an ESG report and 46% (16%) involved assurance—but also the number of metrics assured. Unlike financial audits, ESG assurance varies widely in form and substance, including the choice of metrics assured, the level of assurance, and assuror identity. We show that firms’ decision to obtain ESG assurance is primarily driven by their adoption of ESG reporting frameworks and peer effects, with firm characteristics documented in prior literature playing only a minor role. Assurance is associated with improvements in ESG disclosure, ESG ratings, and the number of institutional investors holding the firm’s stock.

Suggested Citation

  • Brandon Gipper & Samantha Ross & Shawn X. Shi, 2025. "ESG assurance in the United States," Review of Accounting Studies, Springer, vol. 30(2), pages 1753-1803, June.
    • Handle: RePEc:spr:reaccs:v:30:y:2025:i:2:d:10.1007_s11142-024-09856-2
    DOI: 10.1007/s11142-024-09856-2
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    More about this item

    Keywords

    ESG reporting; ESG assurance; Auditing; Sustainability;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M42 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Auditing

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