Sustainability Assurance and The Role of Corporate Governance Characteristics: Evidence From The High-Profile Indonesian Public Listed Companies
DOI:
https://doi.org/10.30872/miceb.v7i1.15579Keywords:
Sustainability Assurance, Corporate Governance, Board of Directors, Audit Committee, High-Profile CompaniesAbstract
Although sustainability reporting has been mandated through POJK 51/2017, assurance practices on sustainability reports in Indonesia remain voluntary with only 40% adoption rate. This study examines how corporate governance characteristics influence the selection of Public Accounting Firms (KAPs) as sustainability assurance providers in Indonesian high-profile companies during 2022-2024. Using binary logistic regression on 51 firm-year observations from 17 Indonesia Stock Exchange-listed companies, the study tests the effects of board size, board meeting frequency, proportion of women directors, and audit committee financial expertise on assurance provider choice. Analysis uses binary logistic regression with SPSS version 26. The results reveal three significant findings: Board size significantly increases the likelihood of selecting KAPs by 74.8%, women board members dramatically enhance this probability; and audit committee financial expertise significantly increases KAP selection with board meeting frequency shows no significant effect, indicating that meeting quality matters more than frequency in strategic assurance decisions. This study contributes by: (1) extending legitimacy theory demonstrating that board size, gender diversity, and financial expertise enhance assurance credibility in emerging markets; (2) providing actionable insights for companies to strengthen board composition and for regulators to develop evidence-based assurance policies
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