Review of Accounting Studies Vol. 30 No. 2 2025

ESG assurance in the United States

Brandon Gipper¹; Samantha M. Ross²; Shawn Shi^3,4

¹ Stanford University · ² University of California College of the Law, San Francisco, USA · ³ University of Washington · ⁴ Seattle University

Abstract

We provide the first large-sample evidence on third-party verification of firms’ environmental and social metrics in ESG reports (ESG assurance) in the United States. Focusing on the S&P 500 from 2010–2020, we document a striking increase in not only the number of firms with ESG assurance—in 2020 (2010), 76% (38%) of the S&P 500 had an ESG report and 46% (16%) involved assurance—but also the number of metrics assured. Unlike financial audits, ESG assurance varies widely in form and substance, including the choice of metrics assured, the level of assurance, and assuror identity. We show that firms’ decision to obtain ESG assurance is primarily driven by their adoption of ESG reporting frameworks and peer effects, with firm characteristics documented in prior literature playing only a minor role. Assurance is associated with improvements in ESG disclosure, ESG ratings, and the number of institutional investors holding the firm’s stock.

DOI

10.1007/s11142-024-09856-2

Volume

30

Issue

2

Pages

1753-1803

Language

en

Sources

crossref openalex

Cite

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