IDEAS home Printed from https://ideas.repec.org/a/wly/buseth/v35y2026i2p1213-1229.html

Audit Committee Characteristics and Sustainability Performance: The Mediating Role of Sustainability Reporting Quality

Author

Listed:
  • Rosalinda Santonastaso
  • Riccardo Macchioni
  • Claudia Zagaria

Abstract

This study examines the impact of audit committee characteristics, specifically independence and expertise, on sustainability performance. It also explores the mediating role of sustainability reporting quality in the relationship between audit committee characteristics and sustainability performance. The study analyzes a sample of 8336 firm‐year observations across 18 European countries and 10 economic sectors from 2012 to 2022. The results reveal that audit committee independence and expertise are positively associated with sustainability performance. Furthermore, the quality of sustainability reporting mediates this relationship, explaining how audit committee characteristics enhance sustainability performance. Empirical evidence regarding the relationship between audit committees and sustainability performance within European countries is limited. Prior research mainly focuses on the direct effects of audit committees on sustainability performance. To the best of the authors' knowledge, this is the first study that provides useful evidence regarding the mediating impact of sustainability reporting quality on the relationship between audit committee characteristics and sustainability performance, offering novel insights into this underexplored area. The findings offer important implications for managers focused on identifying the drivers and enablers for improving sustainability performance. They also contribute to the ongoing regulatory debate by highlighting that a deeper understanding of audit committees' composition and expertise would make European companies more sustainable and more focused on enhancing the quality of sustainability reporting.

Suggested Citation

  • Rosalinda Santonastaso & Riccardo Macchioni & Claudia Zagaria, 2026. "Audit Committee Characteristics and Sustainability Performance: The Mediating Role of Sustainability Reporting Quality," Business Ethics, the Environment & Responsibility, John Wiley & Sons, Ltd., vol. 35(2), pages 1213-1229, April.
    • Handle: RePEc:wly:buseth:v:35:y:2026:i:2:p:1213-1229
    DOI: 10.1111/beer.12842
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/beer.12842
    Download Restriction: no
    File URL: https://libkey.io/10.1111/beer.12842?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Michelle Rodrigue & Michel Magnan & Charles Cho, 2013. "Is Environmental Governance Substantive or Symbolic? An Empirical Investigation," Journal of Business Ethics, Springer, vol. 114(1), pages 107-129, April.
    2. Ahmad Yuosef Alodat & Hamzeh Al Amosh & Saleh F. A. Khatib & Marwan Mansour, 2023. "Audit committee chair effectiveness and firm performance: The mediating role of sustainability disclosure," Cogent Business & Management, Taylor & Francis Journals, vol. 10(1), pages 2181156-218, December.
    3. Paola Fandella & Bruno S. Sergi & Emiliano Sironi, 2023. "Corporate social responsibility performance and the cost of capital in BRICS countries. The problem of selectivity using environmental, social and governance scores," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(4), pages 1712-1722, July.
    4. Zalailah Salleh & Jenny Stewart, 2012. "The role of the audit committee in resolving auditor‐client disagreements: a Malaysian study," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 25(8), pages 1340-1372, October.
    5. Beisland, Leif Atle & Mersland, Roy & Strøm, R. Øystein, 2015. "Audit Quality and Corporate Governance: Evidence from the Microfinance Industry," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 19(3), pages 218-237.
    6. Rashid Zaman & Muhammad Bilal Farooq & Fahad Khalid & Zeeshan Mahmood, 2021. "Examining the extent of and determinants for sustainability assurance quality: The role of audit committees," Business Strategy and the Environment, Wiley Blackwell, vol. 30(7), pages 2887-2906, November.
    7. repec:eme:aaaj00:09513570410567791 is not listed on IDEAS
    8. Amama Shaukat & Yan Qiu & Grzegorz Trojanowski, 2016. "Board Attributes, Corporate Social Responsibility Strategy, and Corporate Environmental and Social Performance," Journal of Business Ethics, Springer, vol. 135(3), pages 569-585, May.
    9. Ranjith Appuhami, 2018. "The signalling role of audit committee characteristics and the cost of equity capital," Pacific Accounting Review, Emerald Group Publishing Limited, vol. 30(3), pages 387-406, August.
    10. Fabrizio Cerbioni & Antonio Parbonetti, 2007. "Exploring the Effects of Corporate Governance on Intellectual Capital Disclosure: An Analysis of European Biotechnology Companies," European Accounting Review, Taylor & Francis Journals, vol. 16(4), pages 791-826.
    11. Al-Shaer, Habiba & Zaman, Mahbub, 2016. "Board gender diversity and sustainability reporting quality," Journal of Contemporary Accounting and Economics, Elsevier, vol. 12(3), pages 210-222.
    12. Anastasia Axjonow & Jürgen Ernstberger & Christiane Pott, 2018. "The Impact of Corporate Social Responsibility Disclosure on Corporate Reputation: A Non-professional Stakeholder Perspective," Journal of Business Ethics, Springer, vol. 151(2), pages 429-450, August.
    13. Galletta, Simona & Goodell, John W. & Mazzù, Sebastiano & Paltrinieri, Andrea, 2023. "Bank reputation and operational risk: The impact of ESG," Finance Research Letters, Elsevier, vol. 51(C).
    14. repec:eme:aaaj00:09513571211275506 is not listed on IDEAS
    15. Anderson, Ronald C. & Mansi, Sattar A. & Reeb, David M., 2004. "Board characteristics, accounting report integrity, and the cost of debt," Journal of Accounting and Economics, Elsevier, vol. 37(3), pages 315-342, September.
    16. Zalailah Salleh & Jenny Stewart, 2012. "The role of the audit committee in resolving auditor‐client disagreements: a Malaysian study," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 25(8), pages 1340-1372, October.
    17. Husam Aldamen & Keith Duncan & Simone Kelly & Ray McNamara & Stephan Nagel, 2012. "Audit committee characteristics and firm performance during the global financial crisis," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 52(4), pages 971-1000, December.
    18. Jengfang Chen & Rong‐Ruey Duh & Fujiing N. Shiue, 2008. "The Effect of Audit Committees on Earnings–Return Association: Evidence from Foreign Registrants in the United States," Corporate Governance: An International Review, Wiley Blackwell, vol. 16(1), pages 32-40, January.
    19. Valeria Naciti & Fabrizio Cesaroni & Luisa Pulejo, 2022. "Corporate governance and sustainability: a review of the existing literature," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 26(1), pages 55-74, March.
    20. Zhihong Wang & Tien‐Shih Hsieh & Joseph Sarkis, 2018. "CSR Performance and the Readability of CSR Reports: Too Good to be True?," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 25(1), pages 66-79, January.
    21. Nazim Hussain & Ugo Rigoni & René P. Orij, 2018. "Corporate Governance and Sustainability Performance: Analysis of Triple Bottom Line Performance," Journal of Business Ethics, Springer, vol. 149(2), pages 411-432, May.
    22. Habiba Al‐Shaer & Mahbub Zaman, 2018. "Credibility of sustainability reports: The contribution of audit committees," Business Strategy and the Environment, Wiley Blackwell, vol. 27(7), pages 973-986, November.
    23. Karen Maas, 2018. "Do Corporate Social Performance Targets in Executive Compensation Contribute to Corporate Social Performance?," Journal of Business Ethics, Springer, vol. 148(3), pages 573-585, March.
    24. Stephan Fuhrmann & Christian Ott & Elisabeth Looks & Thomas W. Guenther, 2017. "The contents of assurance statements for sustainability reports and information asymmetry," Accounting and Business Research, Taylor & Francis Journals, vol. 47(4), pages 369-400, June.
    25. Marco Allegrini & Giulio Greco, 2013. "Corporate boards, audit committees and voluntary disclosure: evidence from Italian Listed Companies," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 17(1), pages 187-216, February.
    26. Peter M. Clarkson & Michael B. Overell & Larelle Chapple, 2011. "Environmental Reporting and its Relation to Corporate Environmental Performance," Abacus, Accounting Foundation, University of Sydney, vol. 47(1), pages 27-60, March.
    27. Hong Yuh Ching & Fábio Gerab, 2017. "Sustainability reports in Brazil through the lens of signaling, legitimacy and stakeholder theories," Social Responsibility Journal, Emerald Group Publishing Limited, vol. 13(1), pages 95-110, March.
    28. Corinne Post & Noushi Rahman & Cathleen McQuillen, 2015. "From Board Composition to Corporate Environmental Performance Through Sustainability-Themed Alliances," Journal of Business Ethics, Springer, vol. 130(2), pages 423-435, August.
    29. Michail Nerantzidis, 2015. "Measuring the quality of the “comply or explain” approach: Evidence from the implementation of the Greek corporate governance code," Managerial Auditing Journal, Emerald Group Publishing, vol. 30(4/5), pages 373-412, May.
    30. Onali, Enrico & Ginesti, Gianluca & Vasilakis, Chrysovalantis, 2017. "How should we estimate value-relevance models? Insights from European data," The British Accounting Review, Elsevier, vol. 49(5), pages 460-473.
    31. Stuart Turley & Mahbub Zaman, 2004. "The Corporate Governance Effects of Audit Committees," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 8(3), pages 305-332, June.
    32. repec:eme:par000:par-12-2016-0120 is not listed on IDEAS
    33. Carol A. Adams, 2004. "The ethical, social and environmental reporting‐performance portrayal gap," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 17(5), pages 731-757, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Aladdin Dwekat & Rasmi Meqbel & Elies Seguí‐Mas & Guillermina Tormo‐Carbó, 2022. "The role of the audit committee in enhancing the credibility of CSR disclosure: Evidence from STOXX Europe 600 members," Business Ethics, the Environment & Responsibility, John Wiley & Sons, Ltd., vol. 31(3), pages 718-740, July.
    2. Dewan Muktadir‐Al‐Mukit & Firoz Haroon Bhaiyat, 2024. "Impact of corporate governance diversity on carbon emission under environmental policy via the mandatory nonfinancial reporting regulation," Business Strategy and the Environment, Wiley Blackwell, vol. 33(2), pages 1397-1417, February.
    3. Habiba Al‐Shaer & Mahbub Zaman, 2018. "Credibility of sustainability reports: The contribution of audit committees," Business Strategy and the Environment, Wiley Blackwell, vol. 27(7), pages 973-986, November.
    4. Zhongtian Li & Jing Jia & Larelle (Ellie) Chapple, 2022. "The corporate sustainability committee and its relation to corporate environmental performance," Meditari Accountancy Research, Emerald Group Publishing Limited, vol. 31(5), pages 1292-1324, July.
    5. Renata Konadu & Gabriel Sam Ahinful & Samuel Owusu-Agyei, 2021. "Corporate governance pillars and business sustainability: does stakeholder engagement matter?," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 18(3), pages 269-289, September.
    6. Nurlan Orazalin & Mady Baydauletov, 2020. "Corporate social responsibility strategy and corporate environmental and social performance: The moderating role of board gender diversity," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(4), pages 1664-1676, July.
    7. Nurlan Orazalin, 2020. "Do board sustainability committees contribute to corporate environmental and social performance? The mediating role of corporate social responsibility strategy," Business Strategy and the Environment, Wiley Blackwell, vol. 29(1), pages 140-153, January.
    8. Govindan, Kannan & Kilic, Merve & Uyar, Ali & Karaman, Abdullah S., 2021. "Drivers and value-relevance of CSR performance in the logistics sector: A cross-country firm-level investigation," International Journal of Production Economics, Elsevier, vol. 231(C).
    9. Ge Wang & Huijin Zhang & Saixing Zeng & Xiaohua Meng & Han Lin, 2023. "Reporting on sustainable development: Configurational effects of top management team and corporate characteristics on environmental information disclosure," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(1), pages 28-52, January.
    10. Ting Li & Yuanqin Li & Han Yang, 2026. "Environmental, Social, and Governance (ESG) Committees and Corporate Sustainable Development Performance: A Dual Legitimacy Perspective," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 47(1), pages 85-108, January.
    11. Musa Ghazwani & Rami Salem & Xi Song & Nedal Sawan & Krayyem Al‐Hajaya, 2025. "Navigating Corporate Integrity: Anti‐Corruption Reporting, Board Cultural Diversity, and ESG‐Sustainability Performance in FTSE 350 Companies," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 32(6), pages 8442-8463, November.
    12. Nicola Cucari & Salvatore Esposito De Falco & Beatrice Orlando, 2018. "Diversity of Board of Directors and Environmental Social Governance: Evidence from Italian Listed Companies," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 25(3), pages 250-266, May.
    13. Rasmi Meqbel & Mohammad Alta'any & Mohammad Abweny & Habiba Al‐Shaer, 2026. "CSR Governance Committee and Carbon Emission Performance: Does Committee Composition Matter?," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 31(1), pages 1395-1423, January.
    14. Bradbury, Michael & Jia, Jing & Li, Zhongtian, 2022. "Corporate social responsibility committees and the use of corporate social responsibility assurance services," Journal of Contemporary Accounting and Economics, Elsevier, vol. 18(2).
    15. Yuan Ma & Qiang Zhang & Qiyue Yin & Bingcheng Wang, 2019. "The Influence of Top Managers on Environmental Information Disclosure: The Moderating Effect of Company’s Environmental Performance," IJERPH, MDPI, vol. 16(7), pages 1-15, April.
    16. Wenjiao Wang & Ziyuan Sun & Yuting Dong & Longyu Zhang, 2025. "Cost of debt financing, stock returns, and corporate strategic ESG disclosure: Evidence from China," Business Ethics, the Environment & Responsibility, John Wiley & Sons, Ltd., vol. 34(4), pages 1787-1812, October.
    17. Kuzey, Cemil & Fritz, Morgane M.C. & Uyar, Ali & Karaman, Abdullah S., 2022. "Board gender diversity, CSR strategy, and eco-friendly initiatives in the transportation and logistics sector," International Journal of Production Economics, Elsevier, vol. 247(C).
    18. Sohail Ahmad Javeed & Boon Heng Teh & Tze San Ong & Lee Lee Chong & Mohd Fairuz Bin Abd Rahim & Rashid Latief, 2022. "How Does Green Innovation Strategy Influence Corporate Financing? Corporate Social Responsibility and Gender Diversity Play a Moderating Role," IJERPH, MDPI, vol. 19(14), pages 1-22, July.
    19. Thi H.H. Nguyen & Mohamed H. Elmagrhi & Collins G. Ntim & Yue Wu, 2021. "Environmental performance, sustainability, governance and financial performance: Evidence from heavily polluting industries in China," Business Strategy and the Environment, Wiley Blackwell, vol. 30(5), pages 2313-2331, July.
    20. Nurlan Orazalin & Monowar Mahmood, 2021. "Toward sustainable development: Board characteristics, country governance quality, and environmental performance," Business Strategy and the Environment, Wiley Blackwell, vol. 30(8), pages 3569-3588, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:buseth:v:35:y:2026:i:2:p:1213-1229. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://onlinelibrary.wiley.com/journal/26946424 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.