The Role of Sustainability Assurance in Enhancing Carbon Disclosure Transparency: Evidence from the ASEAN-5 Emerging Economies

Suhardianto, Novrys and Noman, Abu Hanifa Md. and Harindahyani, Senny and Ardianto, Ardianto and Nuryaddin, Zayyan Ahmad (2026) The Role of Sustainability Assurance in Enhancing Carbon Disclosure Transparency: Evidence from the ASEAN-5 Emerging Economies. Journal of Risk and Financial Management, 19 (1). pp. 1-25. ISSN 1911-8074

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Abstract

The Asia Pacific, led by the resource-dependent ASEAN-5, is the largest carbon contributor, yet its firms exhibit critically low transparency. This study examines the relationship between voluntary Sustainability Assurance (SA) and carbon disclosure transparency using 875 firm-year observations (2018–2022). Applying panel regression and several robustness tests, we find that SA adoption has a positive relationship with the magnitude of disclosed carbon emissions, indicating enhanced transparency. This positive relationship is significantly more pronounced in firms with high environmental performance and greater property, plant, and equipment (PPE) efficiency, suggesting SA aligns with genuine sustainability efforts rather than symbolic reporting. Furthermore, SA increases the likelihood of disclosing the complex Scope 3 emissions. However, the effectiveness of SA is conditional: its transparency benefit is statistically significant only within mandatory sustainability reporting (SR) regimes and in non-environmentally sensitive industries, highlighting crucial variations across regulatory and industrial contexts within ASEAN-5. This research provides evidence on the role of SA in emerging markets, extending Agency Theory by demonstrating its function as a credibility signal that reduces information asymmetry. We offer practical guidance for managers seeking market differentiation, and for regulators aiming to align voluntary SA with IFRS S1/S2 to enhance disclosure quality.

Item Type:	Article
Uncontrolled Keywords:	carbon emission; corporate sustainability; ESGreporting; governance; non-financial audit; sustainability assurance
Subjects:	H Social Sciences > HF Commerce > HF5601 Accounting
Divisions:	Faculty of Business and Economic > Department of Accounting
Depositing User:	SENNY HARINDAHYANI
Date Deposited:	13 Jan 2026 04:14
Last Modified:	13 Jan 2026 04:14
URI:	http://repository.ubaya.ac.id/id/eprint/50071

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