Nonlinear Relationship Between Audit Quality and ESG Performance in Insurance Companies: New Evidence from the MENAT Region

Rewayda Tobar ()
Additional contact information
Rewayda Tobar: Insurance and Risk Management Department, University of Business and Technology, Jeddah 21448, Saudi Arabia

Sustainability, 2025, vol. 17, issue 22, 1-18

Abstract: This study examines the nonlinear connection between audit quality and insurance firm ESG performance based on a sample of 31 MENAT-region insurance companies from 2017 to 2022. Based on a fixed-effect model and quadratic regression, the main results support the presence of a curvilinear nexus between audit quality and ESG performance of insurance companies. This correlation shifts from positive to negative when it reaches a level of 51,7%. Given this, insurers and regulatory bodies should adjust audit quality to a balanced point where it optimizes ESG performance without excesses that would be needlessly costly and have reverse effects. Policy wise, proportionate rules should be established for the inclusion of ESG considerations in auditing, to prevent over-regulation and to achieve a balance between control and performance.

Keywords: audit quality; ESG performance; SGMM; MENAT region (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2071-1050/17/22/9994/pdf (application/pdf)
https://www.mdpi.com/2071-1050/17/22/9994/ (text/html)

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:gam:jsusta:v:17:y:2025:i:22:p:9994-:d:1790496

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().