Voluntary assurance on sustainability reporting in European companies prior to CSRD implementation

Purpose: The paper presents the practices of voluntary assurance on sustainability information disclosure in European companies before the implementation of the Corporate Sustainability Reporting Directive (CSRD). It attempts to determine the factors that influence decisions related to verifying independent reports. Methodology/approach: The research sample comprises 576 European companies whose sustainability reports, prepared according to the GRI guidelines, were available from the GRI Sustainability Disclosure Database. Logit regression was used to determine factors that influence companies' decisions on voluntary assurance. Findings: There is a statistically significant positive relationship between a company's decision to pursue voluntary assurance on sustainability reporting and (1) company-specific characteristics, (2) previous experience with sustainability reporting, (3) selected sustainability reporting practices (e.g., reporting on Sustainable Development Goals) and (4) country-specific factors (e.g., the strength of auditing standards in the company's operating environment). Research limitations/implications: In light of CSRD requirements, which introduced mandatory limited assurance from 2024, transitioning to reasonable assurance over time, the study provides valuable insights into the extent to which companies use assurance services. These findings may be useful for practitioners and standards setters. Originality/value: The paper adds to the understanding of the choices made by individual companies regarding the assurance of sustainability information disclosure. The study considers different influencing factors and examines a time horizon that precedes the implementation of mandatory assurance.