Does Sustainability Assurance Matter in Enhancing Sustainability Performance?: Evidence From Indonesia
Sigit Kurnianto (a) Dian Agustia (b*)

Universitas Airlangga
Jl. Airlangga 4-6, Surabaya, East Java, Indonesia
*dian.agustia[at]feb.unair.ac.id

Abstract

This study aims to determine the effect of Sustainability Assurance (SA) in improving Sustainability Performance (SP) and how it affects the company^s sustainability productivity. The sample used includes all companies in Indonesia, both financial and non-financial sectors, listed on the Indonesia Stock Exchange (IDX) with a sample period from 2017-2021, with a total sample of 646 companies. In testing the hypothesis, the study used regression models and some additional analysis to strengthen the research results. Focusing on sustainability reports from companies in Indonesia, the results of this study show that SA has an effect in increasing SP, which is strongly supported by data testing based on panel data fixed effects, sensitivity analysis, coarsened exact matching method, and Heckman^s two-stage model. SA has significant benefits in improving corporate sustainability productivity, even for businesses that may not openly operate in sectors that are highly sensitive to sustainability issues. Thus, in particular, SA indicates that the company has good SP. SA plays an essential role in improving SP, and subsequently, improving SP will effectively achieve sustainability developments. SA makes the company^s sustainability information more accurate and credible so that the sustainability report can be used by investors in company assessment and investment decision-making.

Keywords: Sustainability assurance, sustainability performance, Indonesia

Topic: Sustainability accounting