An International Investigation of the Institutional Factors Driving Sustainability Assurance

This paper investigates the impact of various factors associated with the adoption of sustainability assurance. Our objective is to find out the impact of country-level institutional factors (stakeholder orientation, voice and accountability, rule of law, investors’protection and long-term orientation) on sustainability assurance. Extant literature is scarce at country-level and specifically does not address the impact of cultural-orientation on sustainability assurance. This paper fills the gap and focuses on the cultural dimension (long-term orientation) in addition to other country-level institutional factors. Companies listed on the Sustainability Disclosure Database (http://database.globalreporting.org) constitute the population for this study. We filtered companies of large size from sustainability-sensitive industries which produced GRI-based reports in the year 2017. Our final sample comprised 196 companies from 41 countries. Using linear regression model, our results suggest that companies that are located in countries with weaker investor protections, greater rule of law, greater voice and accountability, and long-term orientation are more likely to adopt sustainability assurance whereas companies that are located in stakeholder-oriented countries are less likely to adopt sustainability assurance. This paper contributes to the existing literature by providing empirical evidence of the impact of cultural dimensions on sustainability assurance. Future research can explore other dimensions of culture and their impact on sustainability assurance.