The role of sustainable corporate governance in mandatory sustainability reporting quality

Abstract This study analyzes the association between various sustainable corporate governance (SCG) mechanisms and mandatory sustainability reporting quality (MSRQ). To this end, we construct a novel MSRQ measure based on manually collected data from 220 German firms in their first year of according to European CSR Directive (2014/95/EU). Descriptive findings show heterogeneous for our sample. The regression analyses suggest an important role SCG ensuring high MSRQ. increases with number employed. Regarding individual mechanisms, find that is positively associated remuneration executive board, gender diversity at supervisory board level, existence committee, engagement initiatives, external assurance. However, do not any level MSRQ, contradicting research voluntary reporting. Finally, derive several implications preparers, auditors, stakeholders, regulators.