Impact of disclosure and assurance quality of corporate sustainability reports on access to finance Impact of disclosure and assurance quality of corporate sustainability reports on access to finance

This paper investigates the impact of corporate social responsibility (CSR) disclosure quantity, quality, and external validation concerning assurance on capital constraints. We examine if these disclosure characteristics matter to the investors in the financial market, then they should be positively evaluated by financial market participants. More specifically, we study the effects of disclosure quantity, quality, and assurance on the access to financial resources for reporting firms. Analysis of data of an international sample for the period of 2007 – 2016 significantly supports the value relevance idea of CSR disclosure quality. We document that availability of more information about the firm's CSR initiatives eases the financial access. Furthermore, the quality and external assurance of CSR disclosure further strengthen the relationship between disclosure and access to finance. Our paper not only provides support for buying assurance but also argue for better assurance quality.

eases the financial access for reporting companies? And (2) does the quality of sustainability disclosure and external assurance further strengthen the relationship between disclosure and access to finance?
Recently, corporations face amplified pressures from numerous stakeholders to be ethical and transparent (Elias, 2004). For this reason, stakeholders expect corporations to disclose financial and nonfinancial information about a firm's strategies and operations (Cormier & Magnan, 2014;Haque, 2017). The traditional practices of preparing financial reports have failed to fully inform the stakeholders (Bernardi & Stark, 2018). This has shifted managers' attention toward new ways of reporting. As a result, many financial reports now contain CSR performance information (Galbreath, 2011;Rupley, Brown, & Marshall, 2012). Majority of large firms have started issuing standalone sustainability reports (KPMG, 2011). These reports are costly to prepare, yet managers are often unsure if reports achieve the desired goals of information dissemination (O'Dwyer, 2002). This managerial, as well as academic skepticism, has led academic scholarship to study the value relevance, the benefits, of CSR reporting in detail during the last couple of decades (see for review, Wang, Dou, & Jia, 2016).
Despite significant scholarly efforts to investigate the usefulness of CSR disclosure, the disagreement prevails about whether and how CSR disclosure influences stakeholders' perception (Luo, Wang, Raithel, & Zheng, 2015) and firm value (Baboukardos, 2018). Some argue that disclosure quantity leads to more informed investment decision (Dugar & Nathan, 1995;Ioannou & Serafeim, 2015), whereas others consider quality as the main factor for the impact of CSR disclosure on corporate value (Gao, Dong, Ni, & Fu, 2016). This tension not only exists regarding quality and quantity but also about firm's initiative to whether disclose such information or not (Cahan et al., 2016).
For instance, Wang and Tuttle (2014) and Liesen, Figge, Hoepner, and Patten (2017) are of the view that CSR is important for building a firm's reputation in the financial market. On the other hand, Palmer, Oates, and Portney (1995) consider CSR reporting as an additional cost with no benefits. In this paper, we try to resolve this tension by studying the link of both quantity and quality dimensions of CSR disclosure with financial consequences for reporting firms.
From a pure economic perspective, full disclosure helps firms increase information symmetry (Martínez-Ferrero, Ruiz-Cano, & García-Sánchez, 2016), which escalates awareness about a company's existence in the financial market and its investor base (Merton, 1987).
At the same time, superior quality disclosure eases operating cash flows (Lambert, Leuz, & Verrecchia, 2007;Lourenço, Callen, Branco, & Curto, 2014) and lowers financing cost (Dhaliwal, Li, Tsang, & Yang, 2014). Despite these anecdotal shreds of evidence and availability of sustainability information from credible sources, for example, KLD, Bloomberg, and Thomson Reuter's ASSET4, it is not yet clear that how the general investors use this information. Furthermore, such information is not easily understandable by general investors (Luo et al., 2015). Hence, investors are greatly dependent on experts-that is, financial analysts and external monitoring agencies-to interpret the complex CSR information (Dugar & Nathan, 1995).
Despite the continuous production of CSR reports, no empirical investigation fully supports that investors directly rely on CSR information for making their investment decisions (Hodge, Subramaniam, & Stewart, 2009). The basic reason for this lack of confidence could be the absence of credibility mechanisms (Brown-Liburd & Zamora, 2014). This lack of investors' confidence furnishes an economic rationale for a firm to purchase assurance for its CSR/sustainability report (Simnett, Vanstraelen, & Chua, 2009). In this sense, the assurance is more and more likely to materialize the link between CSR information and shareholder confidence. Although Hodge et al. (2009) acknowledge some limitations associated with the CSR assurance process, there is no availability of generally accepted assurance standards and there is a wide heterogeneity of professional services in the assurance market. Both limitations lead to variations in the type of assurance that resultantly cause uncertainty concerning its quality.
Keeping in view these confusions regarding the value relevance of CSR disclosure quantity, quality, external assurance, and assurance quality, this paper tries to uncover some important aspects about the links between CSR disclosure and financial market reaction by bundling and testing the effects of various characteristics of such disclosure on firm's access to finance. This bundling approach helps us shed light on important aspects of value relevance of CSR reporting.
Using 9,744 firm-year observations from 24 different countries and for 10 years, we explore these relationships by employing state-ofthe-art generalized method of moments (GMMs). Our results provide strong and robust support for a positive effect of quantity, quality, availability, and quality of external assurance on access to finance.
We find strong complementarities between various characteristics of CSR disclosure while affecting access to a firm to financial resources.
Our results have several implications for managers and future researchers. First, the results can help boost the confidence of managers on CSR disclosure and assurance. With these practices, managerial decisions not only generate benefits for society and improve corporate transparency but also reduce capital constraints for reporting firms. Second, for firms, it in their great interest to know the clear benefits of reporting CSR information with better quality and external assurance. Our results support that the benefits that can be accrued for a firm by higher quality CSR information disclosure are greater than lower quality reporting. Finally, we must be aware of the fact that CSR disclosure is still voluntary in many countries; the assurance market, moreover, is an unregulated market. For these reasons, our results offer interesting insights for policymakers and regulatory bodies, as well as governments. More specifically, the governments and market regulatory actors can help financial market to be efficient by promoting quality aspects of CSR disclosure in an economy.
The paper is organized as follows: The next section is devoted to the discussion of prior literature and the development of hypotheses.
In section 3 we describe our methodology, data, and the analytical strategy. In section 4, we present the empirical findings and discuss the results. In the last section, we provide conclusions, implications, and future research directions.

| THEORETICAL LENS, LITERATURE REVIEW, AND HYPOTHESIS DEVELOPMENT
The use of theoretical frameworks in exiting research around CSR is very inconstant. In the given research vein, Ioannou and Serafeim (2015) and Luo et al. (2015) use stakeholder theory, Cormier and Magnan (2014) use legitimacy theory, Jo and Harjoto (2014) use agency and stakeholder framework, Lourenço et al. (2014) use signaling theory and resource-based theory, Cho, Lee, and Pfeiffer (2013) follow information efficiency theory, and Aerts, Cormier, and Magnan (2008) take support from institutional theory. A careful review of extant literature reveals that stakeholder theory is the dominant theoretical perspective to provide the rationale for our research question. Therefore, we use the lens of stakeholder theory to provide novel empirical evidence about the value relevance of CSR reporting extrapolated to access to finance.
In line with the stream of literature about the topic, the delineation provided by Carroll (1979) shows that CSR, by definition, should not be related to financial performance. Although on the other hand, Freeman (1984) suggests that firms should consider not only the profit maximization goals but also the goals of a wider variety of stakeholders. In this sense, if the firm takes care of the wider variety of stakeholders, then it can achieve above-average financial performance goals (Flammer, 2013). This implies that stakeholders are important for the survival of a corporation. Research dealing with stakeholder engagement in strategic corporate decision-making issues greatly supports this fact (Henisz, Dorobantu, & Nartey, 2014). Furthermore, in CSR and financial performance nexus research the stakeholder theory has been proposed as a dominant theory in many ways (for a review, see; Agle et al., 2008).
Particularly, Jones (1995) proposed instrumental stakeholder theory according to which CSR is a corporate instrument that firms use to obtain resources or support from stakeholders. Research in this domain show that stakeholder theory can be divided into two main branches-ethical and managerial (Barako & Brown, 2008). Deegan (2013) andO'Dwyer (2002) named ethical as a normative stakeholder theory and managerial positive stakeholder theory. Normative and positive are "mutually supportive" branches of stakeholder theory, and these branches support transparent and conflict-free managementstakeholder relationship (Donaldson & Preston, 1995, p.6). In this sense, stakeholder theory provides better rationale for the nonfinancial disclosure with financial performance. We use the original premise of stakeholder theory that contends that the firm should meet not only stockholder needs but also those of stakeholders concerning providing high-quality financial and nonfinancial information. Moreover, the stakeholder theory also provides a rationale for linking the nonfinancial disclosure characteristics with financial constraints as the theory posits that firms that care for stakeholders have better survival chances in the financial market (Cheng, Ioannou, & Serafeim, 2014).
We built upon existing knowledge on CSR reporting from several perspectives. From strategic management perspective, Sharfman and Fernando (2008), Cheng et al. (2014), andLuo et al. (2015) argue that CSR information is value relevant and the financial market participants use this information to develop their perception about the focal company. Similarly, Dhaliwal, Radhakrishnan, Tsang, and Yang (2012) and Bernardi and Stark (2018) from the field of accounting and Hartojo and Jo (2015) from a business ethics perspective argue that firms that provide CSR disclosure receive more attention from the security analysts and resultantly are more attractive for the investors.
More specifically, Sharfman and Fernando (2008) note that environmental disclosure negatively affects cost of capital. Luo et al. (2015) provide qualitative and quantitative evidence about a positive relationship between CSR disclosure and share performance. Likewise, from the accounting perspective, Dhaliwal et al. (2012) and Bernardi and Stark (2018) note better analysts' forecast accuracy in the presence of CSR information. Similarly, Hartojo and Jo (2015) note a significant negative impact of CSR information on forecast error. Most of these studies argue that firms that are careful about their negative effects of operation on economy, physical environment, and society are more attractive for the financial market participants. In this sense, firms can strategically use the CSR activities to display their care about wider variety of stakeholders better and send a positive signal in the financial market.
Although by definition, CSR is not related to financial performance, in literature this relationship has been studied in great detail (see, e.g., Margolis & Walsh, 2003;Brooks & Oikonomou, 2018;). Yet the consensus regarding the nature of the relationship is missing. This lack of consensus calls for further research. Therefore, we focus on quality as well as the quantity of CSR information in relation to financial constraints. The study of financial constraints is important because it involves frictions in the capital market that can prevent a company from undertaking investment projects due to a scarcity of the necessary financing. This inability to obtain the necessary financing may be due to various other reasons including credit limitations or inability to obtain loans, failure to meet financial market expectations, or liquidity issues due to excessive dependence on bank loans (Lamont, Polk, & Saaá-Requejo, 2001).
Moreover, when determining the conditions of a debt contract, the lender uses all available information to assess the borrower's ability to meet future payment obligations arising from the operation and the potential risks that the company may have. In this sense, the impact that corporate information has in the determination of the conditions agreed upon in credit operations has stimulated research on the relationship between the disclosure, its quality, and the cost of using debt in the capital structure (Goss & Roberts, 2011).
This research stream advances the premise of debt covenant hypothesis: lenders often introduce clauses in debt contracts (debt covenants); these covenants consider that the interest rate supported by the company is linked to the time evolution of certain indicators calculated from their accounting figures, such as profitability and solvency ratios. Recently, CSR has become one of the important indicators of business performance (Wang & Bansal, 2012). Additionally, when determining the conditions of a debt contract, the lender uses all available information to assess the borrower's ability to meet future payment obligations arising from the operation and the potential risks the company may suffer.
In this sense, efficient capital market hypothesis and positive accounting theory support stakeholder theory and posit that more disclosure reduces information asymmetry and improve capital market efficiency (Healy & Palepu, 2001). Yet a critical strand of CSR literature about the usefulness of CSR reporting is fragmented. In this respect, Aerts et al. (2008) provide novel empirical evidence supporting the utility argument of sustainability disclosure. They argue that such disclosure is important for the financial market participants.
Similarly, Kim, Li, and Li (2014) argue that it is necessary to bear in mind that CSR disclosure turns private information into public, decreasing the information risk of uninformed investors.
Despite the theoretical support for CSR disclosure, the controversy regarding the usefulness of such disclosure exists in the recent literature. In this respect, Cormier and Magnan (2014) note that CSR disclosure improves analysts' following and reduces forecast dispersion.
Similarly, Dhaliwal et al. (2012) and Ioannou and Serafeim (2015) among many others find that analysts heed CSR information in preparing their recommendations. On the other hand, Campbell and Slack (2011) document that sustainability information is not useful for sell-side security analysts. Similarly, the literature on the use of CSR information by investors is also fragmented. Recently, Flammer (2013) find that investors pay more for the stock of socially responsible firms, whereas Orlitzky (2013) argues that CSR information disclosure creates noise and increases information asymmetry. More recently, Hawn, Chatterji, and Mitchell (2018) show that CSR performance is not important for investors. However, Cheng et al. (2014) document that firms, which disclose more CSR information, face fewer difficulties in accessing finances and vice versa.
Overall, the role of the quantity of CSR information has been widely studied in the existing investment literature (Dhaliwal et al., 2012(Dhaliwal et al., , 2014 yet the usefulness of the sustainability information for financial market participants is an open-ended empirical research question, which deserves further attention (Jo & Harjoto, 2014). In general, most of the existing investigations support that disclosing CSR reporting is a value-enhancing corporate strategy. Existing evidence also supports that ensuring a higher quality of information could even result in a better investors´valuation of CSR disclosure (Hooks & van Staden, 2011).
Although these pieces of evidence from various literature strands, very little has been researched about the value relevance of CSR assurance. Firms are spending a huge chunk of their already scarce financial resources on purchasing external assurance for CSR reports.
By providing assurance, corporations show a real commitment towards sustainability, as well as they try to improve credibility and consistency of the environmental and social disclosure for stakeholders (Hodge et al., 2009;O'Dwyer & Owen, 2005). By enhancing transparency, firms try reducing the information asymmetry and uncertainty associated with corporate disclosure (Moroney, Windsor, & Aw, 2012;Perego & Kolk, 2012). Yet what value this adds regarding the incremental positive effect on the bottom line is an underexplored research avenue. Dhaliwal et al. (2012) and Brown-Liburd and Zamora (2014) argue that assured CSR/sustainability reports are more trustworthy for investors.
Similarly, Simnett et al. (2009) note that assurance can help reduce the skepticism of the CSR information users and win legitimacy for the firm. Similarly, Mock, Strohm, and Swartz (2007) and Perego and Kolk (2012) argue that external assurance for CSR reports legitimizes the firms' claims about corporate sustainability. But, the above studies do not use holistic approach towards various characteristics of CSR disclosure and their relationship with market reaction.
Reporting more and better quality CSR information as well as getting it externally assured reinforces the credibility and improves confidence and perception of information users (Pflugrath, Roebuck, & Simnett, 2011). The trust generated by the corporate transparency advances understanding of the risks for investors and creditors thus reduces the cost of the debt for reporting firms (Martínez-Ferrero & García-Sánchez, 2017). Furthermore, enhanced investor confidence may help firms improve their access to financial resources (Cheng et al., 2014).
However, the existence of heterogeneous professional services in the assurance market and the lack of generally accepted standards of assurance indicate that there can be a substantial variation in the main elements of an assurance process including objectives, procedures, scope, and assurance report contents (Hodge et al., 2009). This situation creates doubts about the quality of the assurance. Unlike the financial auditor opinion, assurance is not determined by the opinion issued but by the quality indicators of the report issued. A careful review of the literature shows that very little has been researched on this issue. Furthermore, how the capital market reacts to assurance quality is still unknown in the existing literature. Despite the lack of previous studies in this vein and based upon the stakeholder theory, we expect that financial market positively reacts to a higher quality of assurance.
We expect that higher assurance quality achieves better access to finance because in those firms that provides a greater quality external assurance for their nonfinancial reports. For the financial market, the assurance process in itself could be the factor that increases the credibility of the CSR information, not its quality. At least in part, it could be a result of the multiple options of practitioners, levels, criteria, procedures, and opinions concerning assurance.
Overall, we keep in view the theoretical assertions of stakeholder theory, as well as an efficient market hypothesis, positive accounting theory perspective, and abundant empirical support about the quality of information and its usefulness to develop our hypotheses. We believe that providing higher quality CSR information-disclosure and assurance-leads to better access to financial resources. In other words, our research hypotheses contend that CSR disclosure can ease the financial access for firms. Furthermore, this positive relationship can be reinforced if this CSR disclosure is accompanied by better quality and external assurance. Therefore, we hypothesize following relationships: Hypothesis 1. Higher amount of CSR disclosure positively impacts access to financial resources.
Hypothesis 2. Higher quality of CSR disclosure positively impacts access to financial resources.  3 | DATA AND METHODOLOGY

| Sample
We advocate that the prevailing disagreement in the literature can be solved by using specific quality criteria for CSR disclosure. To accomplish this objective, we aim at providing quantitative evidence on the impact of quantity, quality, and reliability of CSR information on access to finance. We collected the data from two different databases for 10 years (i.e., 2007-2016). First, we gathered archival data from Thomson Reuters EIKON for all firms from the global indices. This comprises 3,594 firms belonging to 31 stock indices. Then, we combine the archival data with the CSR reporting information gathered from the Global Reporting Initiative (GRI) database. The GRI database contains all centrally collected data points for reports published from 1999 until the date for more than 6,000 companies worldwide.
For our first objective that is to examine the impact of CSR disclosure, its quality, and reliability on access to financial resources we use this public data. After dropping missing observations, our final balanced sample contains 9,744 firm-year observations from 1,137 firms.
Our sample is quite heterogeneous in terms of operations of sample firms in different sectors as well as different countries. Table 2 provides a detailed description of our study sample concerning time frame, industries, and countries.
Our second objective is to test whether the quality and reliability of CSR information have a positive impact on access to finance. To test the proposed effect, we chose only those companies that disclose their CSR information in standalone CSR reports. However, some do assure such information, whereas others do not. Thus, we removed the firms from our initial sample data of 1,137 firms (9,744 observations) for which assurance data were not available during our selected period. This resulted in 4,076 firm-year observations from 829 firms for the 24 countries and activity sectors.

| Models and analytical technique
The goal of this research is to examine how the CSR disclosure, its quality, and reliability are value relevant for investors by affecting reporting company's access to finances. To achieve this goal, we utilized various regressions models following a sequential logic attending to sample 1 (for hypotheses 1 to 3) and sample 2 (for hypothesis 4).
Using our initial sample, our model 1 examines the impact of the existence of a CSR report on access to finance. After testing this relationship, in model 2, we analyze the effect of the quality of CSR disclosures as well as the moderating role of assurance on the relationship between CSR reporting quality and access to finance. Both models are illustrated below: To test the reinforcing role of assurance quality, we used our second sample, that is, firms that disclose CSR information with assurance data. We address the following question: Does the financial market assess assurance or assurance quality? For this, model 3, represented below, regresses the CSR reporting quality, assurance quality, and the interaction between both on access to finance: All the above models include a firm-specific effect (η) to control for unobserved heterogeneity, whereas (μ) is the disturbance term. In all models, (i) represents a firm and (t) Cheng et al. (2014) to calculate the "KZ_Index" as follows: In the above equation, "CF" represents cash flow, "A" represents total assets, "DIV" represents the cash dividends paid by the company in current year, "C" represents cash balances, "LEV" represents the level of leverage in firm's capital structure, and "Q" represents the market value of equity. From the above equation, the higher value of the KZ index indicates more constraints a firm faces to access finances.

| CSR Disclosure
One of the main independent variables is CSR disclosure ("CSRD").
Following Kolk and Perego (2010) and Gamerschlag, Möller, and Verbeeten (2011), we operationalize CSRD as a dummy variable to measure the availability of a firm's CSR, environmental, or sustainability report. If a firm has issued a standalone report, it takes value 1 and 0 otherwise.

| Quality of CSR disclosure
The remarkable increase in the attention of several stakeholders' groups has led corporations to increase the volume and quality of Following the convention, we also rely on the reports to operationalize the independent variable, "CSRD_quality." We gathered sustainability reports from companies' websites and website of corporateregister.com. 1 In the second step of data gathering, for every year, we review the CSR reports of every company in the sample. In the third step, we compare the information against the recommendations of the G3, G3.1, and G4 guidelines. To do so, we first determined the level of the application according to GRI guidelines to ensure that our scoring is consistent with GRI standards. We further ranked C, B, or A, according to the application of GRI standards. Level C represents the lowest level of application of GRI standards in the standalone report. Similarly, levels B and A reflect medium-and high-quality reports, respectively. Table 1 presents the detail of the scoring process. We follow Cuadrado-Ballesteros et al. (2015) and many others for the scoring procedure. In this process, we distinguish and assign a score for the quantity of reporting data between reporting and nonreporting companies in a specific year. We assign 0 point for nonreporter and 25 points for those companies that publish some information but whose reports do not comply with the GRI guidelines. In the next step, we read and assign a score to the reports that comply with GRI guidelines with levels A, B, or C. We assign 50 points for level C reports, 75 points for level B, and 100 points for level A application. Thus, the disclosure level is measured on an ordinal scale values: 0, 25, 50, 75, or 100.
Furthermore, under recent G4 guidelines, there are two options to prepare CSR/sustainability reports, that is, the core option and the comprehensive option. Both these options aim at identifying material aspects related to corporate sustainability engagement and are applicable to all corporations regardless of their size, sector, or location.
These reflect the organization's economic, environmental, and social impacts. Furthermore, these aspects practically guide the decisionmaking process of major stakeholders.
We assign 75 points to the reports that are following G4 guidelines with the core option, whereas the companies that prepare reports in accordance with G4 guidelines with the comprehensive option have been given 100 points. The difference between the core and the comprehensive option is clearly described in G4 guidelines.
Under the core option framework, firms are obliged to disclose information about their core operations' related data in a qualitative and quantitative form. The comprehensive option includes the core option and requires additional standard disclosures. The additional disclosure includes information regarding a firm's ethics and integrity, strategy and analysis, and governance. Moreover, under this option, a comprehensive performance disclosure is demanded.

| Assurance
As a measure of disclosure quality, we use the external assurance for a standalone sustainability report. At each level of the above application, a "plus" (+) sign is available (ex., C+, B+, and A+) if external assurance was available for a given sustainability report for a specific year. In line with Kolk and Perego (2010) and Zorio, García-Benau, and Sierra (2013), we operationalized assurance as a dummy variable "Assurance" that takes value 1 when the external assurance was available and 0 otherwise. 1 Corporateregister.com is one of the biggest directories that collect full text sustainability report of reporting companies across the globe.

| Assurance quality
Visibility of the assurance engagement can only be generated through the assurance statement. The empirical examination of the assurance statement to understand the quality is one of the many approaches in the CSR assurance literature (Gürtürk & Hahn, 2016;Perego & Kolk, 2012). Based on the evaluation framework by O'Dwyer and Owen (2005), the content analysis is a useful way to evaluate the quality of assurance reports.
Hence, based on the content analysis and the items in Table 2, we create an index referred as "AQ." The 12 items used are relevant measures to understand the quality of assurance reports. This approach is consistent with the assurance quality index suggested by O'Dwyer and Owen (2005) and Zorio et al. (2013). As defined by common CSR reporting guidelines (see, AccountAbility, 2003GRI, 2006. These items set a minimum standard of a statement quality (Perego & Kolk, 2012) and define assurance procedures, a reporting format, opinions, and recommendations. We include these items and the coding rules in Table 2. The score obtained from the content analysis ranges from 0 to 23.

| Control variables
We also include many control variables to account for possible alterna-  2014; Hartojo & Jo, 2015). Our main control variables included "Size" measured as a measure of firm size and determined as the natural logarithm of total assets and "Leverage" measured as the total debt to total equity ratio. We include these controls because the bigger firms with less debt in the capital structure have more resources to invest in nonprofit making activities . Similarly, market capitalization "Market_cap" and "LTD_CE" are included in the model.
We measure them as the market to book ratio and long-term debt divided by common equity respectively. We also include "Loss" that takes value 1 if the firm reports negative earnings in a year and 0 otherwise. As an external governance mechanism, we include the natural logarithm of the number of analysts following the firm through a year represented as "Number_Analysts." The data for this variable were retrieved from I/B/E/S database. "Capital_expenditures" was measured as the capital expenditure expense divided by total sales to control for firms capital needs. Finally, to control for variation across time "Year," country "Country," and industry "Industry," we include dummies.

| Descriptive analyses
In Table 3, we present the year-wise, industry-wise, and countrywise distribution of all variables, that is, CSR reporting, quality of CSR disclosure, assurance, and assurance quality. We observe a yearly increase in the proportion of firms that voluntarily report CSR information as well as the quality of information and credibility (by external assurance and its quality) of this disclosure. The distribution by activity sector indicates that "household and personal products" show the greater percentage of firms disclosing CSR reports, with superior information quality and with a greater inclination to assure them. However, concerning assurance quality, retailing and telecommunications services are the industries with higher mean values. Finland, Luxembourg, Italy, Mexico, and South Africa show that the 100% of observations belong to firms that disclosure CSR information. However, the quality of CSR reporting is higher in Finland and Luxembourg. Italy shows the highest rate of external assurance, but the higher quality values correspond to Finland, Singapore, and Spain.
The correlation matrix and descriptive statistics of all variables are presented in Table 4. The correlation coefficients only indicate low-or moderate-level associations between different constructs.

| The impact on capital constraints of CSR reporting: The quality of information and assurance
We now summarize the main results of our paper. Model 1 aims to test how CSR reports easing the financial access for reporting companies, whereas Model 2 aims to examine how the quality of this voluntary reporting, as well as its external assurance, strengthens the relation between disclosure and access to finance. Finally, Model 3 aims to analyze the impact of assurance quality. Table 5 shows the results of the impact of CSR information on access to finance. In Model 1, CSRD is negative and significant in explaining capital constraints (β 1 = − 0.081, p < 0.05). Moreover, accounting for the elasticity value, that is, how an economic variable responds to a change in another, we can infer a reduction of around 8.1% in capital constraints when a firm issues a standalone report.
Therefore, we support hypothesis 1 and confirm that the CSR disclosure eases the financial access for reporting companies.
However, the value of this reporting is also conditioned on the quality and credibility of information disseminated. In Model 2, "CSRD_quality" is negative and significant in explaining the access to finance with better conditions (β 1 = − 0.004, p < 0.01). This supports our hypothesis 2 that the higher quality of CSR reporting has a positive and significant relationship with the access to financial resources. Given the lack of credibility and user's confidence in the information of CSR, when we examine whether the impact of assurance statement amplifies the previous relationships, we found an interesting result. On the one hand, we acknowledge the need of accounting the effect of external assurance. Model 2 also provides that "Assurance" negatively impacts capital constraints (β 2 = − 0.196, p < 0.01). That means that the external assurance ensures the credibility of CSR information and favors access to finance with lower capital constraints. Furthermore, the test of the complementary or substitutive relationship between both reveals that the interaction term "CSRD_quality * Assurance" has a negative effect on capital constraints (β 3 = − 0.005, p < 0.01). We then calculated the coefficients that revealed that financial access is better for the superior quality of CSR information. This effect is even higher when firms externally assured their reports (β 1 = − 0.004 + β 3 = − 0.005 = −0.009) than when assurance is not available (β 1 = − 0.004).
When we examine the elasticity values of each indicator, the following can be inferred: First we observe a reduction of around 5% in capital constraints when the information of CSR document is of higher quality in terms of comparability and reliability. Secondly, we observe a reduction of around 19% when firms assure their CSR statements.
Finally, we observe a reduction of 9% in capital constraints when the higher quality is complemented by the assurance process (4% + 5%).
This confirms our third hypothesis that the external assurance of CSR reporting further strengthens the relationship between the CSR information quality and access to financial resources. The lower capital constraints that arise from a higher information quality are even reinforced by the existence of an external process of assurance.
However, we must be aware of the fact that coefficients are not relevant in terms of their magnitude. Moreover, when we examine the elasticity's values of each indicator, the insignificant effect regarding the coefficient is again reported because the reduction in the and knowledge about the specific assurance content: a lack of cognitive and professional abilities that is reinforced with the wide diversity existing around the assurance (criteria, processes, standards, assurers, conclusions, and so on) and ends up preventing the external users positively value it. Therefore, despite our earlier result of the lower capital constraints of higher quality and credibility of CSR information, evidence cannot be obtained regarding assurance quality as we proposed in our fourth hypothesis.

| Robustness check
One of the potential limitations of this paper could be related to the measurement of disclosure quality, which is based on content analysis.
To measure the quality, we rely only on the adherence to GRI guidelines to assess the degree and quality of CSR disclosure. To overcome such limitation, and as a sensitivity analysis, we provide evidencebased upon alternative measure CSR disclosure quantity and quality.
For this purpose, we use Thomson Reuters' environmental, social, and governance "ESG" score. ESG score represents a company's CSR performance based on reported data in the public domain. 2 "ESG" score is derived from the scores of 10 performance categories. These performance categories include use of resources, greenhouse and other emissions, sustainable innovations, responsible management, shareholders' relationship management, CSR strategy, workforce-related issues, human rights, community development, and product responsibility. A combination of the scores of 10 performance categories is weighted proportionately to the count the total score. These performance categories are compartmented in three main pillar scores and the final ESG score. This score is widely considered as the representation of a company's ESG performance and commitment. The "ESG" score ranges from 0.1 to 100 based on 10 categories data points that Thomson Reuters assigns. ESG score is minimum for those that report a minimum amount of social and environmental data and the maximum range for those that report every data point.
Building upon this alternative measure of CSR data, Models 2 and 3 are again tested (Model 1 is not regressed because it only examines the impact of the reporting, without accounting for its quality). Results are reported in Table 6 that clearly support the previous findings.
Model 2 confirms that the higher availability of information leads to better financial market response (β 1 = − 0.016). This better response is translated into lower difficulties in accessing finances. Moreover, this effect is even higher when firms externally assured their reports (β 1 = −0.016 + β 3 = − 0.019 = −0.035) than when assurance is not available (β 1 = −0.016). Meanwhile, results of Model 3 shows that the lower capital constraints as a result of superior comparability and availability of CSR information are even greater when assurance is of greater quality (γ 1 = −2.34e−08 + γ 3 = −1.92e−09 = −2.532e−08) than when the quality of assurance is lower (γ 1 = −2.34e-08). However, again, coefficients are not relevant concerning their magnitude, and thus, there is an extremely low relationship between assurance quality and access to financial capital for the firms that encourage assurance for their CSR reports.

| Discussion of results
Overall, our results empirically support the premise of value relevance of CSR reporting, its quality, and credibility; we note that the 2 Currently, there are several ESG data providers, a summary of each of these providers is beyond the scope of this paper. Some of the major well-known ESG rating agencies are (1) Bloomberg, (2) DowJones Sustainability Index (DJSI),      voluntary disclosure of CSR enhances the access to financial resources. We also find that the quality of this information regarding credibility measured by external assurance achieves a greater benefit by decreasing capital constraints to a greater extent.
Our first finding related to the positive assessment of CSR information for investors is in line with prior work of Sharma and Fernando (2008), Dhaliwal et al. (2012), and Hartojo and Jo (2015), CSR reporting receives a positive attention from the financial market participants that resultantly improve the access to finance by better informing the investors. Our findings are in line with those obtained by Cheng et al. (2014), who note the lower difficulties in accessing finance for firms that voluntarily disclose CSR information. Our results also advance the understanding by complementing results related to other disclosure characteristics. Healy and Palepu (2001) and Kim et al. (2014) argue that by turning private into public information, CSR disclosure reduces information asymmetries, forecast errors, and information risk that means improved access to financial resources, that is, lower capital constraints. Our results support the premise that the CSR disclosure influences stakeholder's perceptions (cf. Cormier & Magnan, 2014;Luo et al., 2015). But, our second and third major findings suggest that the quality, as well as the assurance of this information, is the main determinants, which impact the capital constraints with better intensity.
On the one hand, we follow the recommendation of Jo and Harjoto (2014) and examine the quality of information. Additionally, work of Dhaliwal et al. (2012) motivates our analysis to examine the fact that the effect of CSR reporting could disappear in the long-term; therefore, the better approach is to assess the quality effect. We contribute to this empirical debate about the effects of quantity and quality of CSR disclosure on better firm performance. Our evidence documents that the higher quality of information leads to better financial market response. This better response is translated into lower difficulties in accessing finances.
Our results support the premise of the strong utility of external

| CONCLUDING REMARKS
For a sample of international firms from 2007 to 2016, our findings reveal the following: First, we document that CSR information eases the financial access for reporting companies. Second, the quality of CSR disclosure and its external assurance further strengthen the relationship between disclosure and access to finance. Third, we are not able to support that a higher quality of assurance decreases the financial restrictions of a firm. We conclude that financial market does not assess assurance quality as a mechanism for increasing investor's confidence in CSR information, but the availability of assurance does.
Based upon the observed results, we advocate that the prevailing controversy regarding the value relevance of CSR disclosure in the literature can be solved by studying the CSR and financial outcomes relationship from a multidimensional perspective. In this sense, we contribute to the literature in different ways. First, from our analysis of an international sample, this research exposes that how such reporting can better achieve the goals of communicating CSR-related activities in a way that meet the informational needs of a wide range of audience in general and investors in particular. In this research, we analyze the impact on access to finance of CSR information. Value relevance can be referred to the usefulness of sustainability information for financial market participants (Carnevale, Mazzuca, & Venturini, 2012). In line with this definition, we consider sustainability information to be value relevant if it improves access to finances for a CSR reporting firm. In this regard, although there is limited literature available; this paper extends the literature on the relationship between quality, quantity, and reliability of CSR disclosure and access to financial capital (Cheng et al., 2014).
To validate our proposed idea of bundling, we bundle up the quantity with quality of information and its external validation. The results show a strong complementarity between these characteristics of CSR information. This is our second major contribution to extant literature. The investigation of quality and quantity of CSR disclosure, as well as the presence of external assurance and the quality of assurance, helps us explain the phenomenon in more detail as compared with existing studies. We note that firms that are engaged in extensive reporting of the CSR information in standalone sustainability report face less difficulty in attracting investors. Besides, the quality of this reporting and the external verification improve the positive effect of CSR disclosure on the access to financial resources. Thus, from the perspective of the CSR disclosure, we contribute by examining not only the impact of reporting on access to finance but also the disclosure quality and reliability. These aspects of CSR disclosure have been largely ignored in the existing literature. This study helps to advance the understanding of the role that the quality of CSR disclosure and assurance play in producing credible sustainability reports and confidence in the financial market in such reports.
Our third major contribution to the existing literature is the confirmation of the effect of assurance on the link between CSR disclosure and financial market outcomes. We note that the presence, although not its quality, of assurance, is of great importance for the financial market participants. Firms can win the trust of investors by devoting some extra efforts to provide external assurance for their CSR reports.
These fact-based pieces of evidence can clear up the confusion about the value relevance of CSR information as well as the economic benefits of providing more reliable sustainability-related information. In this regard, we provide novel results regarding the effect of assurance by showing that the market positively reacts to a firm's CSR commitment represented by the quality and reliability of CSR information.
Thus, our paper extends and further develops the existing research on CSR assurance (cf. Simnett et al., 2009). Our research can be seen as an answer to the call of Hasan et al. (2005) for an empirical investigation about the economic benefits of sustainability disclosure.
As a final contribution, this paper uses state of the art methodology by testing simultaneous equations for the panel data of sustainability disclosure. The test was based on the GMM estimator proposed by Arellano and Bond (1991), which resolves the issue of endogeneity. In this way, our study is unlike the prior studies, which have only utilized the descriptive analysis for instance content analysis or survey (Pflugrath et al., 2011). Our analysis is enriched due to our focus on the temporal dimension of the data, especially in a period of great change. Analyzing a range of years instead of a single year (Hodge et al., 2009) helped us update the period hitherto analyzed (Mock et al., 2007).
Our results have several implications for managers and future researcher. First, the results can help boost the confidence of managers on CSR disclosure and assurance. With these practices, managerial decisions not only generate benefits for society and improve corporate transparency but also reduce capital constraints for reporting firms. The firms that provide better quality credible CSR information can attract more investments, have better survival chances, and face lower cost of financing (Sharfman & Fernando, 2008). Second, for firms, it in their great interest to know the clear benefits of reporting CSR information with better quality and external assurance. Our results support that the benefits that can be accrued for a firm by higher quality CSR information disclosure are greater than lower quality reporting. Finally, we must be aware of the fact that CSR disclosure is still voluntary in many countries; the assurance market, moreover, is an unregulated market. For these reasons, our results offer interesting insights for policymakers and regulatory bodies, as well as governments. More specifically, the governments and market regulatory actors can help financial market to be efficient by promoting quality aspects of CSR disclosure in a focal economy.
Even though our study contributes towards existing literature, it suffers from some limitations, and one should thoughtfully interpret our findings. The first issue is the absence of generalizable and reliable measures of quality of CSR reporting as well of assurance quality. A debate is still ongoing to find the best measurement of such constructs and items. Despite the fact that the dummy variable of disclosure quantity can be criticized, using an alternative measure of disclosure based on ESG scores does not yield different results. Thus, we claim a positive impact of disclosure quantity, quality, and validity on financial access. We encourage future researchers to use alternative measures to assess the CSR information quality and assurance quality rather than relying on a single disclosure measure to draw useful conclusions.
Moreover, although we identified access to finance as an outcome of CSR disclosure, there could be other potential outcomes that future studies can examine to enrich the understanding. Finally, despite our contribution of using an international sample, the relations proposed are not tested considering the institutional factors and their implications such as the stakeholder orientation of countries, corporate governance, cultural values, and/or ownership concentration.
Future studies can benefit from our recommendations and can advance the literature.