Probe - Accounting, Auditing and Taxation

The impact of ESG information disclosure on audit reports of GEM listed companies

Jiayi Wang

Guangdong University of Science & Technology

Huilin Li

Guangdong University of Science & Technology

DOI: https://doi.org/10.59429/paat.v8i1.13645

Keywords: ESG information disclosure; audit report; audit fees; audit opinion; GEM

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Abstract

With the global advancement of sustainable development, Environmental, Social, and Governance (ESG) factors have become increasingly important in corporate governance and capital market evaluation. In 2025, China officially implemented mandatory ESG disclosure for A-share listed companies, significantly changing the information environment of the Growth Enterprise Market (GEM). Due to the characteristics of GEM firms—Such as high innovation intensity, rapid growth, and relatively immature governance structures—The relationship between ESG information disclosure and audit report outcomes becomes particularly complex. This research adopts a theoretical analysis approach to examine how the quality of ESG information disclosure affects three key dimensions of audit reports: audit opinion type, audit fees, and audit report lag. Drawing on stakeholder theory, information asymmetry theory, and audit risk theory, this paper develops a comprehensive analytical framework explaining how high-quality ESG disclosure can reduce information asymmetry, mitigate corporate risk, and influence auditors' decision-making processes.The analysis suggests that high-quality ESG disclosure decreases the likelihood of modified audit opinions, lowers audit fees, and shortens audit report lag. Furthermore, corporate governance efficiency and institutional investor attention positively moderate these relationships, while ownership type and industry characteristics produce heterogeneous effects. The findings provide theoretical insights for regulators, GEM-listed companies, and audit firms in improving ESG disclosure quality and audit practices.

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