Author
Listed:
- Yanqi Sun
- Kun Su
- Wei Cai
- Min Bai
Abstract
This research explores the relationship between sustainability disclosures and business trust within a dataset comprising 689 publicly listed companies in China spanning from 2006 to 2018. Our analysis delves into how business trust influences levels of sustainability disclosure, revealing a positive correlation between the two. To ensure the reliability of our findings, we conducted additional tests to address potential endogeneity concerns. Supplementary analyses indicate that this positive relationship between sustainability disclosure and business trust is particularly notable among non‐state‐owned enterprises (non‐SOEs) and companies operating in regions characterized by lower levels of marketization. Our study aligns with the principles of neo‐institutional theory, indicating that business trust, functioning as an informal institution, shapes firms' sustainability disclosure practices through normative pressures. Moreover, we observe that business trust holds more sway over sustainability disclosure practices in contexts where formal institutions are weaker. These findings contribute fresh perspectives on the determinants of sustainability disclosures and underscore the pivotal role of business trust in fostering such disclosures. Based on our findings, we suggest that policymakers should foster a business environment that enhances trust among stakeholders, encouraging firms, especially in regions with weak formal institutions, to engage more rigorously in sustainability disclosure. Such policy initiatives could include developing clearer guidelines for sustainability reporting and promoting transparency as a core business value. The implications of our research extend to managers, regulators, and investors alike, highlighting the need for integrated approaches to enhance transparency and trust in the business sector.
Suggested Citation
Yanqi Sun & Kun Su & Wei Cai & Min Bai, 2025.
"Is transparency in sustainability the fruit of business trust: Evidence from sustainability disclosure?,"
International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 30(3), pages 2407-2426, July.
Handle:
RePEc:wly:ijfiec:v:30:y:2025:i:3:p:2407-2426
DOI: 10.1002/ijfe.3022
Download full text from publisher
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:ijfiec:v:30:y:2025:i:3:p:2407-2426. 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.
We have no bibliographic references for this item. You can help adding them by using 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: http://www.interscience.wiley.com/jpages/1076-9307/ .
Please note that corrections may take a couple of weeks to filter through
the various RePEc services.