Carbon accounting quality: Measurement and the role of assurance

Brandon Gipper, Fiona Sequeira, Shawn X. Shi

Journal of Accounting and Economics · 2026 · Volume 81 · Issue 2

DOI: 10.1016/j.jacceco.2025.101849

Abstract

We examine whether external assurance improves the quality of firms' carbon accounting. We develop a measure of carbon accounting quality based on the deviation of reported emissions from a model-based expected level and supplement it with two survey-based measures. We show that assurance is associated with higher carbon accounting quality. This association is stronger when firms have weaker pre-existing carbon accounting systems and when assurance is more thorough. Consistent with assurance enhancing quality, assurance relates to the identification of issues in a firm's carbon accounting system, along with fewer omissions and more revisions of prior disclosures. Exploiting mandated assurance for non-financial reporting in three E.U. countries, we show that firms experience post-regulation increases in carbon accounting quality. Together, the findings highlight the importance of assurance for reporting firms that are improving their carbon accounting quality.

Keywords

Carbon accounting, ESG assurance, Sustainability

Enable JavaScript for citation tools and additional paper interactions.