Carbon Accounting Quality: Measurement and the Role of Assurance

Brandon Gipper, Fiona Sequeira and Shawn X. Shi
Additional contact information
Brandon Gipper: Stanford U
Fiona Sequeira: Stanford U
Shawn X. Shi: U of Washington

Research Papers from Stanford University, Graduate School of Business

Abstract: We examine the role of assurance--third-party verification--on carbon accounting quality. We develop a measure of carbon accounting quality based on the deviation of reported emissions from a model-based expected level and use two other survey-based measures. We show that assurance is associated with improved carbon accounting quality. This association cannot be explained by firm type or firm-level transparency, is isolated to the scope-specific emissions being assured, does not relate to financial reporting quality, and is stronger when assurance is more thorough and pervasive. Assurance improves carbon accounting quality by identifying issues in a firm’s carbon accounting system, resulting in fewer omissions and revisions of prior errors. Using the implementation of mandated assurance in three E.U. countries for non-financial reporting, we show that countries with these mandates experience within-firm improvements in carbon accounting quality post-regulation. Together, the findings highlight the importance of external assurance in shaping carbon accounting quality.

JEL-codes: G11 G18 G30 M14 M41 M42 (search for similar items in EconPapers)
Date: 2024-02
New Economics Papers: this item is included in nep-ene, nep-env and nep-inv
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.gsb.stanford.edu/faculty-research/work ... ement-role-assurance

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ecl:stabus:4186

Access Statistics for this paper

More papers in Research Papers from Stanford University, Graduate School of Business Contact information at EDIRC.
Bibliographic data for series maintained by ().