Title: The effect of comprehensiveness levels and assurance quality of sustainability reports and investor protection levels on information asymmetry

Authors: Annisa Safitri; Ratna Wardhani

Addresses: Faculty of Economics and Business, Department of Accounting, Universitas Indonesia, Kampus UI Depok, 16424, Indonesia ' Faculty of Economics and Business, Department of Accounting, Universitas Indonesia, Kampus UI Depok, 16424, Indonesia

Abstract: This study analyses the effect of sustainability report comprehensiveness level, sustainability report assurance quality, and investor protection level on information asymmetry. We use data from 93 Southeast Asian companies which published sustainability reports during 2015-2017. This study suggests that sustainability report comprehensiveness does not significantly affect information asymmetry. Instead, sustainability report assurance significantly affects information asymmetry. Moreover, higher quality assurance can weaken the negative effect of sustainability report comprehensiveness on analyst forecast accuracy. This study also suggests that a high investor protection level can strengthen the negative effect of sustainability report comprehensiveness on information asymmetry. Sustainability report assurance reduces information asymmetry in countries with strong investor protection levels better.

Keywords: information asymmetry; investor protection; sustainability reports; assurance; bid-ask spread; analyst forecast error; Southeast Asia.

DOI: 10.1504/IJTGM.2023.132039

International Journal of Trade and Global Markets, 2023 Vol.17 No.3/4, pp.270 - 279

Received: 12 Mar 2021
Accepted: 25 Aug 2021
Published online: 07 Jul 2023 *

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