Audit Quality and ESG-Corporate Sustainability Performance: Evidence on the Mediating Role of Internal Control System

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Sharaf-Addin This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-7507109/v1 This work is licensed under a CC BY 4.0 License Status: Under Review Version 1 posted 11 You are reading this latest preprint version Abstract With increasing pressure on companies to enhance their environmental, social, and governance (ESG) reputation, auditing has become a critical tool for ESG compliance and accountability. Although the significance of audit quality in the promotion of corporate sustainability has been outlined by previous researchers, little has been said about the role of internal control system. This study fills this gap by examining the relationship between the audit quality and the ESG-corporate sustainability performance, with a particular emphasis on the mediating role of internal control system. A quantitative approach was applied by focusing on the top 100 largest companies listed in the Saudi Stock Exchange (TADAWUL). The results indicate that auditor expertise, compliance, and responsiveness play significantly affect ESG-corporate sustainability performance, without the same effect being detected for the auditor skepticism. Furthermore, auditor skills as well as responsiveness is positively associated with the internal control system that is also found to have a significant positive relationship with ESG-corporate sustainability performance. Notably, the internal control system was found to significantly mediate the relationship between auditor expertise, compliance, and responsiveness and ESG-corporate sustainability performance, but no mediating effect was found for auditor skepticism. This study contributes to the literature by revealing the mediating effect of internal control system, thereby enhancing the literature base in the field of study. Empirically, the study provides practical insights for stakeholders and policymakers on how audit quality through the internal control system can enhance ESG sustainability performance in the Saudi context. Business and commerce/Business and management Social science/Business and management Business and commerce/Information systems and information technology audit quality internal control system ESG-corporate sustainability performance Saudi listed companies Figures Figure 1 Figure 2 Figure 3 Introduction Several economies can be observed in the world such as green economy, oil economy, tourism and sports economy, and blue economy, etc. Different countries will be having different economies on basis of the resources present in the country (Al-Qatamin & Salleh, 2020 ). A sustainable economy is closely related to sound audit practices, which are essential for building stakeholders’ trust. Thus, one of the justifications for conducting a sustainable audit is its potential to identify operational inefficiencies, thereby enabling organizations to reduce costs and improve performance (Sharaf-addin et al., 2025 ). A sustainable auditing is known to identify opportunities for energy conservation, waste minimization, water use optimization, etc (Napitupulu & Djaddang, 2025 ). The emergence of the International Sustainability Standards Board has brought Environmental, Social, and Governance (ESG) considerations to the forefront of concern for both those responsible for preparing financial statements and auditors. Ensuring sustainable auditing practices involves a meticulous selection of ESG standards by an auditor’s organization (Dagılgan & Ercan, 2025 ). These chosen standards must encompass the necessary criteria for identifying and validating controls that guarantee accurate reporting (Gherai et al., 2024 ). Auditors and accountants are increasingly pivotal in upholding the integrity of their company’s or clients’ disclosure of ESG parameters and metrics. Maintaining a zero-tolerance policy for issues like integrity is imperative. Furthermore, it is crucial to reiterate the importance of comprehensively considering the risks and opportunities associated with climate, human capital, and other ESG factors when they impact the business and operational landscape, leading to material effects on financial statements. Auditors should prioritize understanding management policies and procedures regarding (a) collecting information on climate-related issues affecting the financial statements, (b) assessing the risks of material misstatements resulting from these matters, and (c) evaluating the risks of inadvertent material misstatements in the financial statements related to these issues (Li et al., 2019 ). Hence, auditors are increasingly seen as essential players in ensuring the quality and reliability of ESG-related disclosures, leveraging their expertise to identify reputational and operational risks (Asante-Appiah & Lambert, 2023 ). High audit quality has been widely recognized as a vital factor in promoting transparency, improving corporate accountability, and strengthening stakeholder trust. Consequently, audit functions are critical to ensuring the credibility of sustainability initiatives and reporting. Previous research has investigated the relationship between audit quality and business ESG performance in terms of environmental, social, and governance sustainability. However, the impact of the internal control system on this relationship remains ambiguous. In response to this gap, this study aims to examine the relationship between audit quality, specifically auditor expertise, compliance, skepticism, and responsiveness, and ESG corporate sustainability performance, with a particular focus on the mediating role of internal control system. The study not only addresses this important theoretical gap but also offers practical insights for auditors, regulators, and corporate leaders seeking to enhance sustainability performance through robust governance and control practices. The structure of this study is as follows: the next section presents a critical review of relevant literature on audit quality and ESG-related corporate sustainability performance, serving as a foundation for hypothesis development. This is followed by the methodology section outlining data collection and analysis approaches. The subsequent section presents the empirical findings. Finally, the study concludes with the discussion on the findings, theoretical and practical implications, study limitations, and suggestions for future research in the last section. Literature Review and Hypotheses Development: In the context of the green economy, corporate sustainability has emerged as a vital consideration for firms across all sectors. Companies are now expected to address a wide array of environmental, social, and governance (ESG) issues that may significantly impact their financial statements (Harif & Natasha, 2024 ). Auditors, therefore, play an expanded role not only validating financial information but also overseeing ESG-related disclosures. Given the complex nature of ESG risks, auditing processes must be adapted to account for business-specific, industry-specific, and geographic ESG dynamics (Sharaf-addin et al., 2025 ). This evolution positions auditors as strategic advisors in fostering sustainable practices. Hence, the urgency of sustainability is further underscored by global issues including climate change, ecological degradation, and social inequality. These planetary crises are directly threatening both environmental and economic systems, thereby increasing demand for reliable corporate governance (Abu Bakar et al., 2022 ; Adeyanju et al., 2024 ). Societal well-being, gender equality, and equitable access to natural resources are increasingly at risk, fueling calls for transparency and accountability in corporate behavior. As such, ESG factors have shifted from optional considerations to core business imperatives, and organizations must now demonstrate responsible conduct across multiple dimensions. To meet these expectations, auditors must possess deep expertise in ESG risk factors. Their ability to identify material ESG issues, evaluate the adequacy of risk assessments, and recommend improvements is crucial (Ermilova et al., 2024 ). Tools like ESG dashboards allow auditors to customize analysis based on industry trends, improving the relevance of sustainability assessments. This growing demand for ESG assurance aligns with the evolving role of audit professionals who are now expected to engage proactively with both regulatory developments and stakeholder expectations (Eulerich et al., 2022 ). Simultaneously, international organizations such as the Sustainability Accounting Standards Board and the United Nations have been instrumental in formalizing ESG expectations. The UN’s Sustainable Development Goals (SDGs) provide a global roadmap for firms to align their practices with key social and environmental outcomes (El-Deeb et al., 2023 ; Hazaea et al., 2021 ). This has increased companies’ managerial attention to climate issues, driving them to improve their ESG performance (He et al., 2022 ) through digital finance, which ensures investment efficiency and enhances the quality of information disclosure (Liu et al., 2024 ). As a result, ESG performance has become a key determinant of financial reporting quality, prompting auditors to place greater emphasis on ESG disclosures to strengthen accountability and enhance investor confidence (Sulimany, 2025 ). ESG considerations are increasingly seen as financially material to corporate performance (Maji & Tiwari, 2025 ). Despite being classified as non-financial, ESG factors can directly influence a firm’s cost of capital, risk profile, and long-term valuation (Aydoğmuş et al., 2022 ; Hales, 2023 ). Investors increasingly rely on ESG ratings, which are developed using both firm-disclosed and third-party information. However, the absence of a standardized definition of ESG performance and concerns around data accuracy have cast doubts on the validity of ESG scores (Escrig-Olmedo et al., 2010). This creates a unique opportunity for auditors to enhance credibility through third-party validation. Indeed, audit quality plays a critical role in enhancing ESG disclosure credibility. Independent verification reduces information asymmetries between firms and stakeholders, thereby fostering trust (Healy & Palepu, 2001 ; Junior et al., 2014 ). As part of their professional obligations, auditors engage in risk identification, control system evaluations, and strategic assurance of non-financial reports. Their alignment with frameworks such as Committee of Sponsoring Organization (COSO) and Enterprise Risk Management (ERM) theories (Baxter et al., 2013 ) further equips them to support corporate ESG strategies by embedding robust control systems and assurance protocols. Moreover, stakeholders have become increasingly interested in how organizations integrate ESG into decision-making (Ojetunde et al., 2024 ). Understanding these dynamics is not only important for scholars but also for practitioners and regulators. Audit quality, including auditor expertise, compliance, skepticism, and responsiveness, serves as a strategic governance tool that mitigates agency problems and supports sustainable corporate conduct (Bacha et al., 2021 ; Watkins et al., 2004 ). Therefore, audit quality plays a crucial role in reducing information asymmetry and ensuring reliable financial and non-financial reporting. Prior studies highlight that auditor expertise enhances the accuracy of ESG-related disclosures (Rahman, 2024 ; Sawaya et al., 2025 ). Additionally, ESG compliance efforts benefit from knowledgeable auditors who understand sector-specific ESG risks (Minkkinen et al., 2024 ). Moreover, stakeholders have become increasingly interested in how organizations integrate ESG into decision-making. Understanding these dynamics is not only important for scholars but also for practitioners and regulators. Audit quality, including auditor expertise, compliance, skepticism, and responsiveness, serves as a strategic governance tool that mitigates agency problems and supports sustainable corporate conduct (Bacha et al., 2021 ; Watkins et al., 2004 ). This expertise contributes to more meaningful sustainability disclosures that align with stakeholder expectations. As discussed above, this leads to the proposition of the following hypothesis: H1a: Auditor’s expertise significantly and positively associates with ESG-corporate sustainability performance. Auditor compliance with ESG reporting frameworks, such as those outlined in the Sustainable Development Goals (SDGs) and sustainability accounting standards, ensures that the disclosed information is both accurate and complete (El-Deeb et al., 2023 ). Junior et al. ( 2014 ) found that firms increasingly seek external validation to reinforce the credibility of their ESG disclosures. Further, while Samy El-Deeb et al. ( 2023 ) emphasized the importance of aligning audit efforts with global sustainability goals, Wu et al. ( 2025 ) highlighted the critical role of third-party audits in ensuring transparency and reinforcing ESG regulatory alliances. In light of the previous discussion, the following hypothesis is proposed: H1b: Auditor’s compliance significantly and positively associates with ESG-corporate sustainability performance. Professional skepticism is another important characteristic that is highly essential to determine audit quality (Al-Qatamin & Salleh, 2020 ; Sharaf-addin et al., 2025 ) which allows auditors to critically evaluate ESG claims and detect potential misstatements or greenwashing (Zahid et al., 2022 ). Further, Asante-Appiah & Lambert ( 2023 ) highlighted that skepticism is key in assessing non-financial risks, ensuring ESG reporting remains robust and decision-useful. Based on this discussion, the following hypothesis is proposed: H1c: Professional skepticism significantly and positively associates with ESG-corporate sustainability performance. Zahid et al., ( 2022 ) argued that auditors must remain responsive to the rapidly evolving ESG landscape, adapting audit procedures to reflect new risks, regulatory expectations, and stakeholder demands. Further, Yunis et al. ( 2024 ) highlighted the importance of audit quality for promoting professional innovation related to financial ESG risk-taking. This suggests that auditor responsiveness enables early identification and mitigation of ESG-related risks, thereby enhancing ESG performance. Based on this discussion, the following hypothesis is proposed: H1d: Auditor’s responsiveness significantly and positively associates with ESG-corporate sustainability performance. The importance of auditor expertise in evaluating and enhancing internal control systems has been emphasized, particularly in the context of enterprise risk management (Borchert & Zellmer-Bruhn, 2010 ; Haislip et al., 2016 ; Lisic et al., 2019 ). Skilled auditors can identify control gaps that may impact ESG reporting quality and recommend improvements (Asante-Appiah & Lambert, 2023 ). Based on this discussion, the following hypothesis is proposed: H2a: Auditor’s expertise significantly and positively associates with the internal control system. Healy and Palepu ( 2001 ) found that effective compliance practices, supported by external audit efforts, help build robust internal control systems. These systems play a foundational role in ensuring the validity and completeness of both financial and non-financial disclosures. Hence, the following hypothesis is proposed: H2b: Auditor’s compliance significantly and positively associates with the internal control system. The exercise of professional skepticism enhances the auditor's ability to detect deficiencies in internal processes and controls. Asante-Appiah and Lambert ( 2023 ) confirmed that skeptical auditors provide critical feedback on control weaknesses, enabling organizations to strengthen their risk management frameworks. Based on this discussion, the following hypothesis is proposed: H2c: Professional skepticism significantly and positively associates with the internal control system. The auditor’s responsiveness is essential to identifying emerging control issues (Zahid et al., 2022 ), particularly in the dynamic area of ESG compliance (Lee et al., 2022 ). Responsive auditors can provide timely recommendations for updating internal controls, thus improving their overall effectiveness. Therefore, the following hypothesis is proposed: H2d: Auditor’s responsiveness significantly and positively associates with the internal control system. A corporate internal control system could serve as a vital mediator in translating audit insights into action. Further, an effective internal control system facilitates data reliability, regulatory compliance, and organizational learning (Sharaf-addin et al., 2025 ). Li et al. ( 2018 ) emphasized that a well-structured internal control system supports ESG performance by ensuring proper oversight of ESG data. Internal controls reduce the risk of disclosure errors and enhance the reliability of ESG communications to stakeholders (Baxter et al., 2020 ). By formalizing auditor recommendations, the internal control system ensures that ESG strategies are implemented in a structured and measurable manner (Alewine & Stone, 2013 ). This relationship becomes especially pertinent in emerging markets, where ESG infrastructure is still evolving. Based on this discussion, the following hypothesis is proposed: H3: Internal control system significantly and positively associates with ESG-corporate sustainability performance. Shaiti & Al-Matari ( 2020 ) found that the internal audit function is positively associated with the quality of the internal control system, and this relationship is significantly moderated by enterprise resource planning (ERP). However, previous literature has explored the direct relationship between audit quality and ESG-corporate sustainability performance but has not sufficiently explored the role of the internal control system through which audit quality could impact ESG outcomes. For instance, several studies have shown that audit quality is associated with higher earnings integrity and lower capital costs (Garzón-Jiménez & Zorio-Grima, 2021 ; M. Khan et al., 2016 ; Rodriguez-Fernandez, 2016 ). Yet, most research has focused on the direct impact of audit quality on ESG financial performance, with limited attention to the governance mechanisms that mediate this relationship. Specifically, there is a lack of empirical exploration regarding how audit quality is associated with ESG through the internal control system. In light of these insights, this study aims to explore the role of audit quality in enhancing ESG-corporate sustainability performance among Saudi-listed companies. Particular attention is paid to the mediating effect of internal control systems, thereby addressing a key gap in sustainability and corporate governance literature. This methodology facilitates a deeper and more integrated understanding of how audit practices contribute to sustainable performance outcomes. In this study, an effective internal control system may mediate this relationship by translating audit quality inputs (e.g., expertise, compliance, skepticism, and responsiveness) into improved ESG reporting and performance. Accordingly, the following hypotheses are developed: H4a: Internal control system significantly mediates the relationship between auditor’s expertise and ESG-corporate sustainability performance. H4b: Internal control system significantly mediates the relationship between auditor’s compliance and ESG-corporate sustainability performance H4c: Internal control system significantly mediates the relationship between professional Skepticism and ESG-corporate sustainability performance H4d: Internal control system significantly mediates the relationship between auditor’s responsiveness and ESG-corporate sustainability performance Methodology Sample Selection and Data Collection This study adopted a quantitative research approach, utilizing a questionnaire survey for data collection. The sample of the study included the top 100 companies listed in Saudi Stock Exchange (TADAWUL) and selected based on their total capital investment, assessed by total assets. The targeted respondents were finance department employees, specifically senior managers, managers, heads of departments, senior executives, and executives. Prior to data collection, a pilot study was carried out to refine the questionnaire by pretesting construct measures adapted from previous studies. This involves an interview with three senior executives from a selected company, as well as an in-depth discussion with three academic experts. As a result, all 48 items were found to well represent their specific measurement constructs. The finalized questionnaire was then designed using Google Forms and distributed to the selected companies through personal contacts. A total of 162 responses were collected over a four-month period (December 2024 to March 2025), representing a 36% response rate from the targeted sample of 400 respondents. Table 1 Demographic Information Frequency Percentage Gender Male 136 84.0 Female 26 16.0 Total 162 100.0 Age 50 years 3 1.9 Total 162 100.0 Education Secondary 18 11.1 Bachelor 100 61.7 Post-graduate 44 27.2 Total 162 100.0 Experience 20 years 38 23.5 Total 162 100.0 Based on the demographic results above (see Table 1 ), most respondents are male (136, 84%), and the majority are under 30 years old (102, 63%). They hold a bachelor’s degree (100, 61.7%) and have less than 10 years of experience (112, 69.1%). However, the details of the variables used in the study are presented in Table 2 below. Table 2 Variables Used and Data Sources Variable Name Abbreviation Unit Data Source Auditor’s Expertise AQ_EXP Likert Scale (1–5) (Chi & Chin, 2011 ) Auditor’s Compliance AQ_COM Likert Scale (1–5) (Nelson, 2009 ) Auditor’s Skepticism AQ_SK Likert Scale (1–5) (Hurtt, 2010 ) Auditor’s Responsiveness AQ_RES Likert Scale (1–5) (Gibbins et al., 2010 ) Internal Control System ICS Likert Scale (1–5) (Oussii & Taktak, 2018 ) ESG-Corporate Sustainability Performance ESG_PER Likert Scale (1–5) (Alaamri et al., 2023 ) Research Instruments and Model Development This study started with an extensive review of existing literature to build the study conceptual model, followed by instruments development, sample selection, data collection, and finally data analysis (see Fig. 1 ). A questionnaire survey was used to collect primary data from a targeted sample of the top 100 Saudi listed companies. The data were analysed using Smart PLS version 4.1. Thorough the instruments developed, the relationship between variables is well defined including audit quality characteristics (auditor’s expertise, compliance, skepticism, and responsiveness) as independent variables adopted from the literature, internal control system as a mediating variable suggested by this study, and ESG-corporate sustainability performance as a dependent variable (refer to Fig. 2 ). Results Reliability and Validity To evaluate the reliability and validity of latent constructs, several key statistical measures are commonly applied, including Cronbach’s alpha, composite reliability (CR), and average variance extracted (AVE) (Baah et al., 2021 ; Hair et al., 2017 ; Sharaf-Addin & Al-Dhubaibi, 2025 ; Zaidi et al., 2024 ). In addition, analysing the mean, standard deviation, and factor loadings of individual items within each construct is considered essential (Sharaf-Addin & Al-Dhubaibi, 2025 ). As shown in Table 3 , all observed items exceeded the recommended minimum factor loading threshold of 0.50, consistent with the guidelines provided by Hair et al. ( 2017 ). Table 3 Measurement Items Statistics Item Code Mean SD FL VIF AQ_COMP_Q1 3.326 1.319 0.865 3.359 AQ_COMP_Q2 3.429 1.285 0.905 4.247 AQ_COMP_Q3 3.280 1.227 0.920 4.695 AQ_COMP_Q4 3.366 1.319 0.903 4.377 AQ_COMP_Q5 3.263 1.283 0.900 4.225 AQ_COMP_Q6 3.269 1.266 0.908 4.674 AQ_EXP_Q1 3.211 1.363 0.892 3.521 AQ_EXP_Q2 3.183 1.292 0.887 3.480 AQ_EXP_Q3 3.280 1.338 0.901 3.764 AQ_EXP_Q4 3.274 1.350 0.895 3.584 AQ_EXP_Q5 3.183 1.340 0.906 3.956 AQ_EXP_Q6 3.251 1.303 0.900 3.679 AQ_RES_Q1 3.051 1.341 0.852 2.711 AQ_RES_Q2 3.297 1.345 0.904 3.832 AQ_RES_Q3 3.211 1.396 0.900 3.799 AQ_RES_Q4 3.183 1.357 0.910 4.256 AQ_RES_Q5 3.074 1.278 0.865 2.938 AQ_RES_Q6 3.171 1.383 0.912 4.495 AQ_SK_Q1 3.189 1.371 0.875 3.190 AQ_SK_Q2 3.097 1.277 0.892 3.638 AQ_SK_Q3 3.223 1.220 0.849 2.665 AQ_SK_Q4 3.131 1.296 0.906 4.036 AQ_SK_Q5 3.177 1.355 0.894 3.640 AQ_SK_Q6 3.246 1.374 0.873 3.108 ESG_ENV_Q1 3.229 1.302 0.876 3.306 ESG_ENV_Q2 3.211 1.321 0.886 3.663 ESG_PER_Q1 3.269 1.403 0.918 5.289 ESG_PER_Q2 3.360 1.261 0.906 4.513 ESG_PER_Q3 3.349 1.326 0.923 4.873 ESG_PER_Q4 3.320 1.309 0.894 4.035 ESG_PER_Q5 3.331 1.293 0.893 3.757 ESG_PER_Q6 3.411 1.349 0.920 4.988 ESG_SOC_Q1 3.149 1.292 0.914 4.335 ESG_SOC_Q2 3.103 1.233 0.905 4.828 ESG_SOC_Q3 3.269 1.288 0.924 4.965 ESG_SOC_Q4 3.291 1.318 0.873 3.975 The analysis also included an assessment of convergent validity (see Table 4 ), which revealed that all constructs had Cronbach’s alpha and CR values above 0.70, along with AVE values exceeding 0.50. These results are in line with the established benchmarks outlined by Hair et al. ( 2019 ), thereby confirming that the measurement model demonstrates acceptable reliability and convergent validity. Accordingly, the SEM model can be valid and specified from both reflective and formative measurement approaches. Table 4 Discriminant validity with HTMT Cronbach's alpha Composite reliability (rho c ) Average variance extracted (AVE) AQ_COMP 0.953 0.954 0.811 AQ_EXP 0.951 0.952 0.805 AQ_RES 0.948 0.948 0.793 AQ_SK 0.943 0.945 0.777 ESG_PER 0.958 0.958 0.826 ICS 0.951 0.952 0.804 Model Goodness of Fit The Standardized Root Mean Squared Residual (SRMR), f-square (f²), Normed Fit Index (NFI), and R-square (R²) were used to assess the model’s goodness of fit. The R² value for audit quality measures comprising (Expertise, Compliance, Skepticism, and Responsiveness) to ESG-Corporate Sustainability Performance is 0.806, indicating that these factors collectively explain 80.6% of the variance in ESG-corporate sustainability performance. Meanwhile, the internal control system demonstrates an R² value of 0.626, suggesting that it accounts for 62.6% of the variance in ESG-corporate sustainability performance. The f-squared statistic, which measures the impact of each exogenous variable on the variance explained, was computed alongside SRMR and NFI to assess model fit, following the guidelines provided by Hair et al. ( 2019 ) and Khan et al. ( 2019 ). According to Hair et al. ( 2019 ) and Khan et al. ( 2019 ), acceptable thresholds include an f-squared value greater than 0.02, SRMR below 0.08, and NFI values approaching 1.0. As shown in Table 5 , the SEM model meets these benchmarks, with all f-squared values indicating adequate effect sizes. In addition, model fit is confirmed by an SRMR of 0.039, below the recommended cut-off, and an NFI score of 0.815, exceeding the acceptable level of 0.80. Table 5 Model performance and fit R-sequence R Square Adjusted R Square SRMR NFI AQ_EXP 0.041 AQ_COMP 0.068 AQ_SK 0.085 AQ_RES 0.022 ICS 0.806 0.800 0.039 0.815 ESG_PER 0.626 0.618 0.039 0.815 Hypotheses Results: Figure 3 below illustrates the hypothesized model, including both direct and indirect relationships. Correspondingly, Tables 5 and 6 show T-statistic, coefficient, P-value, and hypotheses results for each relationship of the SEM model. Table 6 Results of Direct Path Analysis and Hypothesis Testing Path Coeff. (B) T-statistic P-value Hypotheses Results AQ_EXP -> ESG_PER 0.241 3.032 0.002 H1a: Accepted AQ_COMP -> ESG_PER 0.208 2.292 0.022 H1b: Accepted AQ_SK -> ESG_PER -0.127 1.213 0.225 H1c: Rejected AQ_RES -> ESG_PER 0.350 3.386 0.001 H1d: Accepted AQ_EXP -> ICS 0.270 2.706 0.007 H2a: Accepted AQ_COMP -> ICS -0.038 0.307 0.759 H2b: Rejected AQ_SK -> ICS 0.078 0.536 0.592 H2c: Rejected AQ_RES -> ICS 0.518 4.420 0.000 H2d: Accepted ICS -> ESG_PER 0.303 3.769 0.002 H3: Accepted Table 7 Results of Indirect Path Analysis and Hypothesis Testing Path Coeff. (B) T-statistic P-value Hypotheses Results AQ_EXP -> ICS -> ESG_PER 0.182 2.869 0.023 H4a: Accepted AQ_COMP -> ICS -> ESG_PER 0.171 1.297 0.036 H4b: Accepted AQ_SK -> ICS -> ESG_PER 0.023 0.515 0.607 H4c: Rejected AQ_RES -> ICS -> ESG_PER 0.257 3.102 0.009 H4d: Accepted The hypothesis outcomes related to the direct impact of audit quality measures on ESG-corporate sustainability performance can be found in Table 6 . In the first part of the hypotheses results, the hypotheses (H1a, H2b, and H1d) were accepted with significant P -values and a coefficient of 0.241, 0.208, and 0.350, respectively, demonstrating substantive evidence of the relationships tested. However, hypothesis H1c was rejected as shown by a coefficient of -0.127 and a P -value greater than 0.05, indicating no relationship was found where the p -value was not significant. That means the audit quality measures (author’s expertise, compliance, and responsiveness) are significantly and positively associated with ESG-corporate sustainability performance, and conversely, the auditor’s skepticism is not significantly associated with ESG-corporate sustainability performance. In the second part of the hypothesis results showing the results pertaining the direct relationship of audit quality measures and internal control system, two hypotheses were validated (H2a and H2d) with significant (coefficient of 0.270 and 0.518 correspondingly, and p -values < 0.05), demonstrate substantive evidence of the relationships tested. Conversely, the other two hypotheses (H2b and H2c) were rejected with non-significant (coefficient of -0.038 and 0.078 correspondingly, and p -values > 0.05) indicating no significant evidence of the relationship tested. That means that the auditor’s expertise and responsiveness were found to be positively and significantly associated with internal control system, and conversely, the auditor’s compliance and skepticism were not significantly associated with internal control system. Finally, in the third part of the direct relationship tested, the internal control system is positively and significantly associated with ESG-corporate sustainability performance with a coefficient of 0.303 and a p -value of 0.002, supporting H3. This provides evidence that the internal control system supports ESG-corporate sustainability performance. However, the hypotheses results in Table 7 present the indirect relationship between audit quality measures and ESG-corporate sustainability performance through the mediation of internal control system. In the results, all hypotheses (H4a, H4b, and H4d) were supported, except for H4c, where the p -values indicated statistical significance, providing significant evidence for the mediating effect tested. However, the analysis of H4c indicated that the mediating role of the internal control system was not statistically significant, indicating no mediating role in this context. Specifically, the first hypothesis (H4a), which proposes that the internal control system significantly mediates the relationship between auditor expertise and ESG-corporate sustainability performance, was supported (coefficient = 0.182, p -value = 0.023). This result indicates partial mediation, as the direct relationship remained significant but was reduced in magnitude. The second hypothesis (H4b) was supported (coefficient = 0.171, p -value = 0.036), indicating that the internal control system significantly mediates the relationship between auditor compliance and ESG-corporate sustainability performance. Given that the direct effect (coefficient = 0.249) decreased when the internal control system acted as a mediator, partial mediation is indicated. In contrast, the third hypothesis (H4c) was not supported (coefficient = 0.023, p -value = 0.607), suggesting that the internal control system does not significantly mediate the relationship between auditor skepticism and ESG-corporate sustainability performance. Additionally, the direct relationship in this case was non-significant, indicating the absence of mediation. Lastly, the fourth hypothesis (H4d) was confirmed, as the internal control system significantly mediates the relationship between auditor responsiveness and ESG-corporate sustainability performance (coefficient = 0.257, p -value = 0.009). Since this mediation effect was smaller than the direct effect (coefficient = 0.350), partial mediation is also supported here. Discussion and Conclusion This study examines the relationship between audit quality and ESG-corporate sustainability performance, mediated by the internal control system within Saudi-listed companies. The results revealed that auditor expertise, compliance, and responsiveness have a significant direct effect on ESG-corporate sustainability performance. This supports the findings of many of previous research (Junior et al., 2014 ), where an increasing number of businesses are looking for outside expertise in order to validate the data that is incorporated into their non-financial reports. Further, auditors have experience and expertise in evaluating ESG-related factors because, as part of the audit of financial statements, they are required to consider any risk factor that could lead to an ESG-material misstatement (Asante-Appiah & Lambert, 2023 ). However, auditor skepticism did not show a significant effect, and this contrasts with several prior studies. For instance, Hurtt ( 2010 ) and Nelson ( 2009 ) emphasized the importance of skepticism in detecting irregularities and strengthening audit judgments. Similarly, Koo and Ki (2020) found that skeptical auditors enhance governance processes by identifying control weaknesses. The lack of significance in this study may be attributed to contextual and cultural factors in Saudi Arabia, where the exercise of professional skepticism may be constrained by hierarchical organizational structures or a lack of emphasis in training programs. In contrast, it was found that auditor expertise and responsiveness have a positive and significant association with the internal control system. This aligns with the findings of Harasheh and Provasi ( 2023 ), who noted that technically competent auditors contribute to stronger internal controls and financial reporting quality. Similarly, Koo and Ki (2020) emphasized that auditor expertise is critical in identifying risks and advising management on improving controls. Furthermore, a direct relationship between the internal control system and ESG-corporate sustainability performance was significantly supported and confirms previous studies that suggest effective internal controls are a backbone of credible sustainability disclosures (Napitupulu & Djaddang, 2025 ; Shaiti & Al-Matari, 2020 ). Finally, as a study’s contribution, the results found that the internal control system significantly mediates the relationships between auditor expertise, compliance, responsiveness, and ESG-corporate sustainability performance, while this mediating effect was not found for auditor skepticism. This suggests that high-quality audits enhance ESG-corporate sustainability performance not directly, but through their influence on the internal control system. However, the absence of a mediating effect for auditor skepticism diverges from the expectations set by prior literature, again highlighting the need to revisit how skepticism is taught and practiced. The study results, therefore, point to a gap in awareness or application of skepticism within the Saudi audit profession and raise the need for context-specific professional development programs that clarify its constructive role. While this study supports existing research on the positive roles of auditor expertise, compliance and responsiveness, it also reveals notable divergence concerning the role of skepticism. These findings stress the importance of tailoring audit quality development strategies to national and cultural contexts to optimize their impact on ESG-corporate sustainability performance. Additionally, the study contributes to providing empirical evidence that high audit quality plays a pivotal role in enhancing the ESG-corporate sustainability performance when the internal control system is active and solid, ensuring that ESG initiatives are not only effectively implemented but also accurately reported. Although the results of the study empirically and theoretically contributed to the existing literature, some limitations are to be reported. First, the sample in this study includes only the top 100 companies listed in Saudi Stock Exchange (TADAWUL), which may lead the results to have less generalizability to a smaller companies or non-listed companies that have different audit processes. Second, the cross-sectional data nature constrains the possibilities of inferring the cause-and-effect relationship between audit quality, internal control system, and ESG-corporate sustainability performance. Finally, questionnaire survey data may have response bias, specifically in technical concepts such as auditor skepticism. However, future research could explore empirical data across diverse company sizes and industry sectors, or conduct cross-country comparisons to examine how cultural and regulatory contexts influence the relationship between audit quality and ESG-corporate sustainability performance. Declarations Ethics statements This study was conducted in accordance with the principles of the Declaration of Helsinki, and approval was granted by the Ethics Committee of Jazan University (Date: 24/12/2024/No. HAPO-10-Z-001). All participants were informed about the study’s purpose, assured of anonymity and confidentiality, and provided informed consent prior to participation. Written informed consent was obtained from all participants prior to completing the questionnaire survey, which was conducted online (via Google Forms) between December 2024 and March 2025. Declarations of competing interests The authors state that none of the work disclosed in this publication may have been influenced by any known conflicting financial interests or personal ties. Funding statement The authors gratefully acknowledge the funding of the Deanship of Graduate Studies and Scientific Research. Jazan University, Saudi Arabia, through Project Number: RG24-S0197 Author Contribution Author’s (1) Contribution:Mohammed AlfifyAssistant ProfessorDepartment of Accounting and Finance, Jazan University, Saudi ArabiaEmail: [email protected] Contribution: Research Idea, Conceptualization, Investigation, Data collection, Writing - Review & EditingAuthor’s (2) Contribution:Hussein H. Sharaf-AddinSenior LecturerDepartment of Management, Centre of Social Innovation (CoSI), Institute of Smart & Sustainable Living (ISSL), Universiti Teknologi PETRONAS, 32610 Seri Iskandar, Perak, Malaysia Email: [email protected] Contribution: Methodology, Data analysis, Writing - Original Draft, Final Draft Organization, Visualization Acknowledgement The authors gratefully acknowledge the funding of the Deanship of Graduate Studies and Scientific Research. Jazan University, Saudi Arabia, through Project Number: RG24-S0197 Data Availability The data utilized for this empirical study is available upon request. References Abu Bakar, M. A., Abdul Rahim, A., & Mohd Nasir, M. I. (2022). Understanding the Importance of Provisioning Ecosystem Services in Natural Resource-Dependent Poor Household: A Case Study of Jerlun, Kedah. International Journal of Academic Research in Business and Social Sciences , 12 (9), 339–354. https://doi.org/10.6007/ijarbss/v12-i9/14492 Adeyanju, A. 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Sharaf-Addin","email":"","orcid":"","institution":"Universiti Teknologi PETRONASDe","correspondingAuthor":false,"prefix":"","firstName":"Hussein","middleName":"H.","lastName":"Sharaf-Addin","suffix":""}],"badges":[],"createdAt":"2025-09-01 10:08:26","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-7507109/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-7507109/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":101193832,"identity":"fe070113-c74f-476f-a09f-53a727035d4f","added_by":"auto","created_at":"2026-01-27 07:43:09","extension":"jpg","order_by":1,"title":"Figure 1","display":"","copyAsset":false,"role":"figure","size":88339,"visible":true,"origin":"","legend":"\u003cp\u003eSummary of the Research Methodology\u003c/p\u003e","description":"","filename":"1.jpg","url":"https://assets-eu.researchsquare.com/files/rs-7507109/v1/963cd5a2ebc57a1ae7479873.jpg"},{"id":101193829,"identity":"9196c01a-b641-47ba-8449-9b8f224e317b","added_by":"auto","created_at":"2026-01-27 07:43:08","extension":"jpg","order_by":2,"title":"Figure 2","display":"","copyAsset":false,"role":"figure","size":84428,"visible":true,"origin":"","legend":"\u003cp\u003eConceptual Research Model\u003c/p\u003e","description":"","filename":"2.jpg","url":"https://assets-eu.researchsquare.com/files/rs-7507109/v1/f8e03f08d3bf08cc238f8bfe.jpg"},{"id":101193830,"identity":"48b2f854-09ce-4fcb-b744-2bb167006fc2","added_by":"auto","created_at":"2026-01-27 07:43:08","extension":"jpg","order_by":3,"title":"Figure 3","display":"","copyAsset":false,"role":"figure","size":123729,"visible":true,"origin":"","legend":"\u003cp\u003eSchematic of the Structural Equation Model\u003c/p\u003e","description":"","filename":"3.jpg","url":"https://assets-eu.researchsquare.com/files/rs-7507109/v1/c63990a64714c35116a772a0.jpg"},{"id":101296641,"identity":"50db4e4e-fe98-477f-9676-72da1135df37","added_by":"auto","created_at":"2026-01-28 09:17:46","extension":"pdf","order_by":0,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":1296601,"visible":true,"origin":"","legend":"","description":"","filename":"manuscript.pdf","url":"https://assets-eu.researchsquare.com/files/rs-7507109/v1/7a1b276f-3acc-4320-bef6-5e3741d89d20.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"Audit Quality and ESG-Corporate Sustainability Performance: Evidence on the Mediating Role of Internal Control System","fulltext":[{"header":"Introduction","content":"\u003cp\u003eSeveral economies can be observed in the world such as green economy, oil economy, tourism and sports economy, and blue economy, etc. Different countries will be having different economies on basis of the resources present in the country (Al-Qatamin \u0026amp; Salleh, \u003cspan citationid=\"CR3\" class=\"CitationRef\"\u003e2020\u003c/span\u003e). A sustainable economy is closely related to sound audit practices, which are essential for building stakeholders\u0026rsquo; trust. Thus, one of the justifications for conducting a sustainable audit is its potential to identify operational inefficiencies, thereby enabling organizations to reduce costs and improve performance (Sharaf-addin et al., \u003cspan citationid=\"CR51\" class=\"CitationRef\"\u003e2025\u003c/span\u003e). A sustainable auditing is known to identify opportunities for energy conservation, waste minimization, water use optimization, etc (Napitupulu \u0026amp; Djaddang, \u003cspan citationid=\"CR42\" class=\"CitationRef\"\u003e2025\u003c/span\u003e). The emergence of the International Sustainability Standards Board has brought Environmental, Social, and Governance (ESG) considerations to the forefront of concern for both those responsible for preparing financial statements and auditors. Ensuring sustainable auditing practices involves a meticulous selection of ESG standards by an auditor\u0026rsquo;s organization (Dagılgan \u0026amp; Ercan, \u003cspan citationid=\"CR14\" class=\"CitationRef\"\u003e2025\u003c/span\u003e). These chosen standards must encompass the necessary criteria for identifying and validating controls that guarantee accurate reporting (Gherai et al., \u003cspan citationid=\"CR19\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). Auditors and accountants are increasingly pivotal in upholding the integrity of their company\u0026rsquo;s or clients\u0026rsquo; disclosure of ESG parameters and metrics. Maintaining a zero-tolerance policy for issues like integrity is imperative. Furthermore, it is crucial to reiterate the importance of comprehensively considering the risks and opportunities associated with climate, human capital, and other ESG factors when they impact the business and operational landscape, leading to material effects on financial statements. Auditors should prioritize understanding management policies and procedures regarding (a) collecting information on climate-related issues affecting the financial statements, (b) assessing the risks of material misstatements resulting from these matters, and (c) evaluating the risks of inadvertent material misstatements in the financial statements related to these issues (Li et al., \u003cspan citationid=\"CR36\" class=\"CitationRef\"\u003e2019\u003c/span\u003e). Hence, auditors are increasingly seen as essential players in ensuring the quality and reliability of ESG-related disclosures, leveraging their expertise to identify reputational and operational risks (Asante-Appiah \u0026amp; Lambert, \u003cspan citationid=\"CR6\" class=\"CitationRef\"\u003e2023\u003c/span\u003e). High audit quality has been widely recognized as a vital factor in promoting transparency, improving corporate accountability, and strengthening stakeholder trust. Consequently, audit functions are critical to ensuring the credibility of sustainability initiatives and reporting.\u003c/p\u003e \u003cp\u003ePrevious research has investigated the relationship between audit quality and business ESG performance in terms of environmental, social, and governance sustainability. However, the impact of the internal control system on this relationship remains ambiguous. In response to this gap, this study aims to examine the relationship between audit quality, specifically auditor expertise, compliance, skepticism, and responsiveness, and ESG corporate sustainability performance, with a particular focus on the mediating role of internal control system. The study not only addresses this important theoretical gap but also offers practical insights for auditors, regulators, and corporate leaders seeking to enhance sustainability performance through robust governance and control practices. The structure of this study is as follows: the next section presents a critical review of relevant literature on audit quality and ESG-related corporate sustainability performance, serving as a foundation for hypothesis development. This is followed by the methodology section outlining data collection and analysis approaches. The subsequent section presents the empirical findings. Finally, the study concludes with the discussion on the findings, theoretical and practical implications, study limitations, and suggestions for future research in the last section.\u003c/p\u003e\n\u003ch3\u003eLiterature Review and Hypotheses Development:\u003c/h3\u003e\n\u003cp\u003eIn the context of the green economy, corporate sustainability has emerged as a vital consideration for firms across all sectors. Companies are now expected to address a wide array of environmental, social, and governance (ESG) issues that may significantly impact their financial statements (Harif \u0026amp; Natasha, \u003cspan citationid=\"CR26\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). Auditors, therefore, play an expanded role not only validating financial information but also overseeing ESG-related disclosures. Given the complex nature of ESG risks, auditing processes must be adapted to account for business-specific, industry-specific, and geographic ESG dynamics (Sharaf-addin et al., \u003cspan citationid=\"CR51\" class=\"CitationRef\"\u003e2025\u003c/span\u003e). This evolution positions auditors as strategic advisors in fostering sustainable practices. Hence, the urgency of sustainability is further underscored by global issues including climate change, ecological degradation, and social inequality. These planetary crises are directly threatening both environmental and economic systems, thereby increasing demand for reliable corporate governance (Abu Bakar et al., \u003cspan citationid=\"CR1\" class=\"CitationRef\"\u003e2022\u003c/span\u003e; Adeyanju et al., \u003cspan citationid=\"CR2\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). Societal well-being, gender equality, and equitable access to natural resources are increasingly at risk, fueling calls for transparency and accountability in corporate behavior. As such, ESG factors have shifted from optional considerations to core business imperatives, and organizations must now demonstrate responsible conduct across multiple dimensions. To meet these expectations, auditors must possess deep expertise in ESG risk factors. Their ability to identify material ESG issues, evaluate the adequacy of risk assessments, and recommend improvements is crucial (Ermilova et al., \u003cspan citationid=\"CR16\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). Tools like ESG dashboards allow auditors to customize analysis based on industry trends, improving the relevance of sustainability assessments. This growing demand for ESG assurance aligns with the evolving role of audit professionals who are now expected to engage proactively with both regulatory developments and stakeholder expectations (Eulerich et al., \u003cspan citationid=\"CR17\" class=\"CitationRef\"\u003e2022\u003c/span\u003e). Simultaneously, international organizations such as the Sustainability Accounting Standards Board and the United Nations have been instrumental in formalizing ESG expectations. The UN\u0026rsquo;s Sustainable Development Goals (SDGs) provide a global roadmap for firms to align their practices with key social and environmental outcomes (El-Deeb et al., \u003cspan citationid=\"CR15\" class=\"CitationRef\"\u003e2023\u003c/span\u003e; Hazaea et al., \u003cspan citationid=\"CR27\" class=\"CitationRef\"\u003e2021\u003c/span\u003e). This has increased companies\u0026rsquo; managerial attention to climate issues, driving them to improve their ESG performance (He et al., \u003cspan citationid=\"CR28\" class=\"CitationRef\"\u003e2022\u003c/span\u003e) through digital finance, which ensures investment efficiency and enhances the quality of information disclosure (Liu et al., \u003cspan citationid=\"CR39\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). As a result, ESG performance has become a key determinant of financial reporting quality, prompting auditors to place greater emphasis on ESG disclosures to strengthen accountability and enhance investor confidence (Sulimany, \u003cspan citationid=\"CR52\" class=\"CitationRef\"\u003e2025\u003c/span\u003e).\u003c/p\u003e \u003cp\u003eESG considerations are increasingly seen as financially material to corporate performance (Maji \u0026amp; Tiwari, \u003cspan citationid=\"CR40\" class=\"CitationRef\"\u003e2025\u003c/span\u003e). Despite being classified as non-financial, ESG factors can directly influence a firm\u0026rsquo;s cost of capital, risk profile, and long-term valuation (Aydoğmuş et al., \u003cspan citationid=\"CR7\" class=\"CitationRef\"\u003e2022\u003c/span\u003e; Hales, \u003cspan citationid=\"CR24\" class=\"CitationRef\"\u003e2023\u003c/span\u003e). Investors increasingly rely on ESG ratings, which are developed using both firm-disclosed and third-party information. However, the absence of a standardized definition of ESG performance and concerns around data accuracy have cast doubts on the validity of ESG scores (Escrig-Olmedo et al., 2010). This creates a unique opportunity for auditors to enhance credibility through third-party validation. Indeed, audit quality plays a critical role in enhancing ESG disclosure credibility. Independent verification reduces information asymmetries between firms and stakeholders, thereby fostering trust (Healy \u0026amp; Palepu, \u003cspan citationid=\"CR29\" class=\"CitationRef\"\u003e2001\u003c/span\u003e; Junior et al., \u003cspan citationid=\"CR31\" class=\"CitationRef\"\u003e2014\u003c/span\u003e). As part of their professional obligations, auditors engage in risk identification, control system evaluations, and strategic assurance of non-financial reports. Their alignment with frameworks such as Committee of Sponsoring Organization (COSO) and Enterprise Risk Management (ERM) theories (Baxter et al., \u003cspan citationid=\"CR10\" class=\"CitationRef\"\u003e2013\u003c/span\u003e) further equips them to support corporate ESG strategies by embedding robust control systems and assurance protocols.\u003c/p\u003e \u003cp\u003eMoreover, stakeholders have become increasingly interested in how organizations integrate ESG into decision-making (Ojetunde et al., \u003cspan citationid=\"CR44\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). Understanding these dynamics is not only important for scholars but also for practitioners and regulators. Audit quality, including auditor expertise, compliance, skepticism, and responsiveness, serves as a strategic governance tool that mitigates agency problems and supports sustainable corporate conduct (Bacha et al., \u003cspan citationid=\"CR9\" class=\"CitationRef\"\u003e2021\u003c/span\u003e; Watkins et al., \u003cspan citationid=\"CR53\" class=\"CitationRef\"\u003e2004\u003c/span\u003e). Therefore, audit quality plays a crucial role in reducing information asymmetry and ensuring reliable financial and non-financial reporting. Prior studies highlight that auditor expertise enhances the accuracy of ESG-related disclosures (Rahman, \u003cspan citationid=\"CR46\" class=\"CitationRef\"\u003e2024\u003c/span\u003e; Sawaya et al., \u003cspan citationid=\"CR48\" class=\"CitationRef\"\u003e2025\u003c/span\u003e). Additionally, ESG compliance efforts benefit from knowledgeable auditors who understand sector-specific ESG risks (Minkkinen et al., \u003cspan citationid=\"CR41\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). Moreover, stakeholders have become increasingly interested in how organizations integrate ESG into decision-making. Understanding these dynamics is not only important for scholars but also for practitioners and regulators. Audit quality, including auditor expertise, compliance, skepticism, and responsiveness, serves as a strategic governance tool that mitigates agency problems and supports sustainable corporate conduct (Bacha et al., \u003cspan citationid=\"CR9\" class=\"CitationRef\"\u003e2021\u003c/span\u003e; Watkins et al., \u003cspan citationid=\"CR53\" class=\"CitationRef\"\u003e2004\u003c/span\u003e). This expertise contributes to more meaningful sustainability disclosures that align with stakeholder expectations. As discussed above, this leads to the proposition of the following hypothesis:\u003c/p\u003e \u003cp\u003e \u003cem\u003eH1a: Auditor\u0026rsquo;s expertise significantly and positively associates with ESG-corporate sustainability performance.\u003c/em\u003e \u003c/p\u003e \u003cp\u003eAuditor compliance with ESG reporting frameworks, such as those outlined in the Sustainable Development Goals (SDGs) and sustainability accounting standards, ensures that the disclosed information is both accurate and complete (El-Deeb et al., \u003cspan citationid=\"CR15\" class=\"CitationRef\"\u003e2023\u003c/span\u003e). Junior et al. (\u003cspan citationid=\"CR31\" class=\"CitationRef\"\u003e2014\u003c/span\u003e) found that firms increasingly seek external validation to reinforce the credibility of their ESG disclosures. Further, while Samy El-Deeb et al. (\u003cspan citationid=\"CR15\" class=\"CitationRef\"\u003e2023\u003c/span\u003e) emphasized the importance of aligning audit efforts with global sustainability goals, Wu et al. (\u003cspan citationid=\"CR54\" class=\"CitationRef\"\u003e2025\u003c/span\u003e) highlighted the critical role of third-party audits in ensuring transparency and reinforcing ESG regulatory alliances. In light of the previous discussion, the following hypothesis is proposed:\u003c/p\u003e \u003cp\u003e \u003cem\u003eH1b: Auditor\u0026rsquo;s compliance significantly and positively associates with ESG-corporate sustainability performance.\u003c/em\u003e \u003c/p\u003e \u003cp\u003eProfessional skepticism is another important characteristic that is highly essential to determine audit quality (Al-Qatamin \u0026amp; Salleh, \u003cspan citationid=\"CR3\" class=\"CitationRef\"\u003e2020\u003c/span\u003e; Sharaf-addin et al., \u003cspan citationid=\"CR51\" class=\"CitationRef\"\u003e2025\u003c/span\u003e) which allows auditors to critically evaluate ESG claims and detect potential misstatements or greenwashing (Zahid et al., \u003cspan citationid=\"CR56\" class=\"CitationRef\"\u003e2022\u003c/span\u003e). Further, Asante-Appiah \u0026amp; Lambert (\u003cspan citationid=\"CR6\" class=\"CitationRef\"\u003e2023\u003c/span\u003e) highlighted that skepticism is key in assessing non-financial risks, ensuring ESG reporting remains robust and decision-useful. Based on this discussion, the following hypothesis is proposed:\u003c/p\u003e \u003cp\u003e \u003cem\u003eH1c: Professional skepticism significantly and positively associates with ESG-corporate sustainability performance.\u003c/em\u003e \u003c/p\u003e \u003cp\u003eZahid et al., (\u003cspan citationid=\"CR56\" class=\"CitationRef\"\u003e2022\u003c/span\u003e) argued that auditors must remain responsive to the rapidly evolving ESG landscape, adapting audit procedures to reflect new risks, regulatory expectations, and stakeholder demands. Further, Yunis et al. (\u003cspan citationid=\"CR55\" class=\"CitationRef\"\u003e2024\u003c/span\u003e) highlighted the importance of audit quality for promoting professional innovation related to financial ESG risk-taking. This suggests that auditor responsiveness enables early identification and mitigation of ESG-related risks, thereby enhancing ESG performance. Based on this discussion, the following hypothesis is proposed:\u003c/p\u003e \u003cp\u003e \u003cem\u003eH1d: Auditor\u0026rsquo;s responsiveness significantly and positively associates with ESG-corporate sustainability performance.\u003c/em\u003e \u003c/p\u003e \u003cp\u003eThe importance of auditor expertise in evaluating and enhancing internal control systems has been emphasized, particularly in the context of enterprise risk management (Borchert \u0026amp; Zellmer-Bruhn, \u003cspan citationid=\"CR12\" class=\"CitationRef\"\u003e2010\u003c/span\u003e; Haislip et al., \u003cspan citationid=\"CR23\" class=\"CitationRef\"\u003e2016\u003c/span\u003e; Lisic et al., \u003cspan citationid=\"CR38\" class=\"CitationRef\"\u003e2019\u003c/span\u003e). Skilled auditors can identify control gaps that may impact ESG reporting quality and recommend improvements (Asante-Appiah \u0026amp; Lambert, \u003cspan citationid=\"CR6\" class=\"CitationRef\"\u003e2023\u003c/span\u003e). Based on this discussion, the following hypothesis is proposed:\u003c/p\u003e \u003cp\u003e \u003cem\u003eH2a: Auditor\u0026rsquo;s expertise significantly and positively associates with the internal control system.\u003c/em\u003e \u003c/p\u003e \u003cp\u003eHealy and Palepu (\u003cspan citationid=\"CR29\" class=\"CitationRef\"\u003e2001\u003c/span\u003e) found that effective compliance practices, supported by external audit efforts, help build robust internal control systems. These systems play a foundational role in ensuring the validity and completeness of both financial and non-financial disclosures. Hence, the following hypothesis is proposed:\u003c/p\u003e \u003cp\u003e \u003cem\u003eH2b: Auditor\u0026rsquo;s compliance significantly and positively associates with the internal control system.\u003c/em\u003e \u003c/p\u003e \u003cp\u003eThe exercise of professional skepticism enhances the auditor's ability to detect deficiencies in internal processes and controls. Asante-Appiah and Lambert (\u003cspan citationid=\"CR6\" class=\"CitationRef\"\u003e2023\u003c/span\u003e) confirmed that skeptical auditors provide critical feedback on control weaknesses, enabling organizations to strengthen their risk management frameworks. Based on this discussion, the following hypothesis is proposed:\u003c/p\u003e \u003cp\u003e \u003cem\u003eH2c: Professional skepticism significantly and positively associates with the internal control system.\u003c/em\u003e \u003c/p\u003e \u003cp\u003eThe auditor\u0026rsquo;s responsiveness is essential to identifying emerging control issues (Zahid et al., \u003cspan citationid=\"CR56\" class=\"CitationRef\"\u003e2022\u003c/span\u003e), particularly in the dynamic area of ESG compliance (Lee et al., \u003cspan citationid=\"CR35\" class=\"CitationRef\"\u003e2022\u003c/span\u003e). Responsive auditors can provide timely recommendations for updating internal controls, thus improving their overall effectiveness. Therefore, the following hypothesis is proposed:\u003c/p\u003e \u003cp\u003e \u003cem\u003eH2d: Auditor\u0026rsquo;s responsiveness significantly and positively associates with the internal control system.\u003c/em\u003e \u003c/p\u003e \u003cp\u003eA corporate internal control system could serve as a vital mediator in translating audit insights into action. Further, an effective internal control system facilitates data reliability, regulatory compliance, and organizational learning (Sharaf-addin et al., \u003cspan citationid=\"CR51\" class=\"CitationRef\"\u003e2025\u003c/span\u003e). Li et al. (\u003cspan citationid=\"CR37\" class=\"CitationRef\"\u003e2018\u003c/span\u003e) emphasized that a well-structured internal control system supports ESG performance by ensuring proper oversight of ESG data. Internal controls reduce the risk of disclosure errors and enhance the reliability of ESG communications to stakeholders (Baxter et al., \u003cspan citationid=\"CR11\" class=\"CitationRef\"\u003e2020\u003c/span\u003e). By formalizing auditor recommendations, the internal control system ensures that ESG strategies are implemented in a structured and measurable manner (Alewine \u0026amp; Stone, \u003cspan citationid=\"CR5\" class=\"CitationRef\"\u003e2013\u003c/span\u003e). This relationship becomes especially pertinent in emerging markets, where ESG infrastructure is still evolving. Based on this discussion, the following hypothesis is proposed:\u003c/p\u003e \u003cp\u003e \u003cem\u003eH3: Internal control system significantly and positively associates with ESG-corporate sustainability performance.\u003c/em\u003e \u003c/p\u003e \u003cp\u003eShaiti \u0026amp; Al-Matari (\u003cspan citationid=\"CR49\" class=\"CitationRef\"\u003e2020\u003c/span\u003e) found that the internal audit function is positively associated with the quality of the internal control system, and this relationship is significantly moderated by enterprise resource planning (ERP). However, previous literature has explored the direct relationship between audit quality and ESG-corporate sustainability performance but has not sufficiently explored the role of the internal control system through which audit quality could impact ESG outcomes. For instance, several studies have shown that audit quality is associated with higher earnings integrity and lower capital costs (Garz\u0026oacute;n-Jim\u0026eacute;nez \u0026amp; Zorio-Grima, \u003cspan citationid=\"CR18\" class=\"CitationRef\"\u003e2021\u003c/span\u003e; M. Khan et al., \u003cspan citationid=\"CR33\" class=\"CitationRef\"\u003e2016\u003c/span\u003e; Rodriguez-Fernandez, \u003cspan citationid=\"CR47\" class=\"CitationRef\"\u003e2016\u003c/span\u003e). Yet, most research has focused on the direct impact of audit quality on ESG financial performance, with limited attention to the governance mechanisms that mediate this relationship. Specifically, there is a lack of empirical exploration regarding how audit quality is associated with ESG through the internal control system. In light of these insights, this study aims to explore the role of audit quality in enhancing ESG-corporate sustainability performance among Saudi-listed companies. Particular attention is paid to the mediating effect of internal control systems, thereby addressing a key gap in sustainability and corporate governance literature. This methodology facilitates a deeper and more integrated understanding of how audit practices contribute to sustainable performance outcomes. In this study, an effective internal control system may mediate this relationship by translating audit quality inputs (e.g., expertise, compliance, skepticism, and responsiveness) into improved ESG reporting and performance. Accordingly, the following hypotheses are developed:\u003c/p\u003e \u003cp\u003e \u003cem\u003eH4a: Internal control system significantly mediates the relationship between auditor\u0026rsquo;s expertise and ESG-corporate sustainability performance.\u003c/em\u003e \u003c/p\u003e \u003cdiv id=\"Sec3\" class=\"Section2\"\u003e \u003cp\u003eH4b: Internal control system significantly mediates the relationship between auditor\u0026rsquo;s compliance and ESG-corporate sustainability performance\u003c/p\u003e \u003cdiv id=\"Sec4\" class=\"Section3\"\u003e \u003cp\u003eH4c: Internal control system significantly mediates the relationship between professional Skepticism and ESG-corporate sustainability performance\u003c/p\u003e \u003cdiv id=\"Sec5\" class=\"Section4\"\u003e \u003cp\u003eH4d: Internal control system significantly mediates the relationship between auditor\u0026rsquo;s responsiveness and ESG-corporate sustainability performance\u003c/p\u003e \u003c/div\u003e \u003c/div\u003e \u003c/div\u003e"},{"header":"Methodology","content":"\u003cdiv id=\"Sec7\" class=\"Section2\"\u003e \u003ch2\u003eSample Selection and Data Collection\u003c/h2\u003e \u003cp\u003eThis study adopted a quantitative research approach, utilizing a questionnaire survey for data collection. The sample of the study included the top 100 companies listed in Saudi Stock Exchange (TADAWUL) and selected based on their total capital investment, assessed by total assets. The targeted respondents were finance department employees, specifically senior managers, managers, heads of departments, senior executives, and executives. Prior to data collection, a pilot study was carried out to refine the questionnaire by pretesting construct measures adapted from previous studies. This involves an interview with three senior executives from a selected company, as well as an in-depth discussion with three academic experts. As a result, all 48 items were found to well represent their specific measurement constructs. The finalized questionnaire was then designed using Google Forms and distributed to the selected companies through personal contacts. A total of 162 responses were collected over a four-month period (December 2024 to March 2025), representing a 36% response rate from the targeted sample of 400 respondents.\u003c/p\u003e \u003cp\u003e \u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab1\" border=\"1\"\u003e \u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 1\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eDemographic Information\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e \u003ccolgroup cols=\"4\"\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e \u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e \u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e \u003cthead\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/th\u003e \u003cth align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/th\u003e \u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003eFrequency\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003ePercentage\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003c/thead\u003e \u003ctbody\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eGender\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eMale\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e136\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e84.0\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eFemale\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e26\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e16.0\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e\u003cb\u003eTotal\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e\u003cb\u003e162\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e\u003cb\u003e100.0\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAge\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e\u0026lt;\u0026thinsp;30 years\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e102\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e63.0\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e30\u0026ndash;40 years\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e44\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e27.2\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e41\u0026ndash;50 years\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e13\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e8.0\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e\u0026gt;\u0026thinsp;50 years\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e3\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e1.9\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e\u003cb\u003eTotal\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e\u003cb\u003e162\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e\u003cb\u003e100.0\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eEducation\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eSecondary\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e18\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e11.1\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eBachelor\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e100\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e61.7\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003ePost-graduate\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e44\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e27.2\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e\u003cb\u003eTotal\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e\u003cb\u003e162\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e\u003cb\u003e100.0\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eExperience\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e\u0026lt;\u0026thinsp;10 years\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e112\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e69.1\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e10\u0026ndash;20 years\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e12\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e7.4\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e\u0026gt;\u0026thinsp;20 years\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e38\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e23.5\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003e\u003cb\u003eTotal\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e\u003cb\u003e162\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e\u003cb\u003e100.0\u003c/b\u003e\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003c/tbody\u003e \u003c/colgroup\u003e \u003c/table\u003e\u003c/div\u003e \u003c/p\u003e \u003cp\u003eBased on the demographic results above (see Table\u0026nbsp;\u003cspan refid=\"Tab1\" class=\"InternalRef\"\u003e1\u003c/span\u003e), most respondents are male (136, 84%), and the majority are under 30 years old (102, 63%). They hold a bachelor\u0026rsquo;s degree (100, 61.7%) and have less than 10 years of experience (112, 69.1%).\u003c/p\u003e \u003cp\u003eHowever, the details of the variables used in the study are presented in Table\u0026nbsp;\u003cspan refid=\"Tab2\" class=\"InternalRef\"\u003e2\u003c/span\u003e below.\u003c/p\u003e \u003cp\u003e \u003cdiv class=\"gridtable\"\u003e\u003ctable float=\"Yes\" id=\"Tab2\" border=\"1\"\u003e \u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 2\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eVariables Used and Data Sources\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e \u003ccolgroup cols=\"4\"\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e \u003cdiv align=\"left\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e \u003cthead\u003e \u003ctr\u003e \u003cth align=\"left\" colname=\"c1\"\u003e \u003cp\u003eVariable Name\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003eAbbreviation\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003eUnit\u003c/p\u003e \u003c/th\u003e \u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003eData Source\u003c/p\u003e \u003c/th\u003e \u003c/tr\u003e \u003c/thead\u003e \u003ctbody\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAuditor\u0026rsquo;s Expertise\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eAQ_EXP\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eLikert Scale (1\u0026ndash;5)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e(Chi \u0026amp; Chin, \u003cspan citationid=\"CR13\" class=\"CitationRef\"\u003e2011\u003c/span\u003e)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAuditor\u0026rsquo;s Compliance\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eAQ_COM\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eLikert Scale (1\u0026ndash;5)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e(Nelson, \u003cspan citationid=\"CR43\" class=\"CitationRef\"\u003e2009\u003c/span\u003e)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAuditor\u0026rsquo;s Skepticism\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eAQ_SK\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eLikert Scale (1\u0026ndash;5)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e(Hurtt, \u003cspan citationid=\"CR30\" class=\"CitationRef\"\u003e2010\u003c/span\u003e)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAuditor\u0026rsquo;s Responsiveness\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eAQ_RES\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eLikert Scale (1\u0026ndash;5)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e(Gibbins et al., \u003cspan citationid=\"CR20\" class=\"CitationRef\"\u003e2010\u003c/span\u003e)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eInternal Control System\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eICS\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eLikert Scale (1\u0026ndash;5)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e(Oussii \u0026amp; Taktak, \u003cspan citationid=\"CR45\" class=\"CitationRef\"\u003e2018\u003c/span\u003e)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003ctr\u003e \u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG-Corporate Sustainability Performance\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c2\"\u003e \u003cp\u003eESG_PER\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c3\"\u003e \u003cp\u003eLikert Scale (1\u0026ndash;5)\u003c/p\u003e \u003c/td\u003e \u003ctd align=\"left\" colname=\"c4\"\u003e \u003cp\u003e(Alaamri et al., \u003cspan citationid=\"CR4\" class=\"CitationRef\"\u003e2023\u003c/span\u003e)\u003c/p\u003e \u003c/td\u003e \u003c/tr\u003e \u003c/tbody\u003e \u003c/colgroup\u003e \u003c/table\u003e\u003c/div\u003e \u003c/p\u003e \u003c/div\u003e \u003cdiv id=\"Sec8\" class=\"Section2\"\u003e \u003ch2\u003eResearch Instruments and Model Development\u003c/h2\u003e \u003cp\u003eThis study started with an extensive review of existing literature to build the study conceptual model, followed by instruments development, sample selection, data collection, and finally data analysis (see Fig.\u0026nbsp;\u003cspan refid=\"Fig1\" class=\"InternalRef\"\u003e1\u003c/span\u003e). A questionnaire survey was used to collect primary data from a targeted sample of the top 100 Saudi listed companies. The data were analysed using Smart PLS version 4.1.\u003c/p\u003e \u003cp\u003e \u003c/p\u003e \u003cp\u003eThorough the instruments developed, the relationship between variables is well defined including audit quality characteristics (auditor\u0026rsquo;s expertise, compliance, skepticism, and responsiveness) as independent variables adopted from the literature, internal control system as a mediating variable suggested by this study, and ESG-corporate sustainability performance as a dependent variable (refer to Fig.\u0026nbsp;\u003cspan refid=\"Fig2\" class=\"InternalRef\"\u003e2\u003c/span\u003e).\u003c/p\u003e \u003cp\u003e \u003c/p\u003e \u003c/div\u003e"},{"header":"Results","content":"\u003cdiv id=\"Sec10\" class=\"Section2\"\u003e \u003ch2\u003eReliability and Validity\u003c/h2\u003e \u003cp\u003eTo evaluate the reliability and validity of latent constructs, several key statistical measures are commonly applied, including Cronbach’s alpha, composite reliability (CR), and average variance extracted (AVE) (Baah et al., \u003cspan citationid=\"CR8\" class=\"CitationRef\"\u003e2021\u003c/span\u003e; Hair et al., \u003cspan citationid=\"CR22\" class=\"CitationRef\"\u003e2017\u003c/span\u003e; Sharaf-Addin \u0026amp; Al-Dhubaibi, \u003cspan citationid=\"CR50\" class=\"CitationRef\"\u003e2025\u003c/span\u003e; Zaidi et al., \u003cspan citationid=\"CR57\" class=\"CitationRef\"\u003e2024\u003c/span\u003e). In addition, analysing the mean, standard deviation, and factor loadings of individual items within each construct is considered essential (Sharaf-Addin \u0026amp; Al-Dhubaibi, \u003cspan citationid=\"CR50\" class=\"CitationRef\"\u003e2025\u003c/span\u003e). As shown in Table\u0026nbsp;\u003cspan refid=\"Tab3\" class=\"InternalRef\"\u003e3\u003c/span\u003e, all observed items exceeded the recommended minimum factor loading threshold of 0.50, consistent with the guidelines provided by Hair et al. (\u003cspan citationid=\"CR22\" class=\"CitationRef\"\u003e2017\u003c/span\u003e).\u003c/p\u003e \u003cp\u003e \u003c/p\u003e\u003cdiv class=\"gridtable\"\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c5\" colnum=\"5\"\u003e\u003c/div\u003e\u003ctable float=\"Yes\" id=\"Tab3\" border=\"1\"\u003e\u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 3\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eMeasurement Items Statistics\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e\u003ccolgroup cols=\"5\"\u003e\u003c/colgroup\u003e\u003cthead\u003e\u003ctr\u003e\u003cth align=\"left\" colname=\"c1\"\u003e \u003cp\u003eItem Code\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003eMean\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003eSD\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003eFL\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c5\"\u003e \u003cp\u003eVIF\u003c/p\u003e \u003c/th\u003e\u003c/tr\u003e\u003c/thead\u003e\u003ctbody\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP_Q1\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.326\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.319\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.865\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.359\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP_Q2\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.429\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.285\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.905\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.247\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP_Q3\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.280\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.227\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.920\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.695\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP_Q4\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.366\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.319\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.903\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.377\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP_Q5\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.263\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.283\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.900\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.225\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP_Q6\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.269\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.266\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.908\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.674\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP_Q1\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.211\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.363\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.892\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.521\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP_Q2\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.183\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.292\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.887\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.480\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP_Q3\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.280\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.338\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.901\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.764\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP_Q4\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.274\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.350\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.895\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.584\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP_Q5\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.183\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.340\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.906\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.956\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP_Q6\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.251\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.303\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.900\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.679\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES_Q1\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.051\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.341\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.852\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e2.711\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES_Q2\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.297\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.345\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.904\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.832\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES_Q3\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.211\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.396\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.900\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.799\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES_Q4\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.183\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.357\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.910\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.256\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES_Q5\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.074\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.278\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.865\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e2.938\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES_Q6\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.171\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.383\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.912\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.495\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK_Q1\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.189\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.371\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.875\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.190\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK_Q2\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.097\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.277\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.892\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.638\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK_Q3\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.223\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.220\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.849\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e2.665\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK_Q4\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.131\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.296\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.906\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.036\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK_Q5\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.177\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.355\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.894\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.640\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK_Q6\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.246\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.374\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.873\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.108\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_ENV_Q1\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.229\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.302\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.876\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.306\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_ENV_Q2\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.211\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.321\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.886\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.663\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_PER_Q1\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.269\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.403\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.918\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e5.289\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_PER_Q2\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.360\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.261\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.906\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.513\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_PER_Q3\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.349\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.326\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.923\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.873\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_PER_Q4\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.320\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.309\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.894\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.035\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_PER_Q5\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.331\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.293\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.893\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.757\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_PER_Q6\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.411\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.349\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.920\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.988\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_SOC_Q1\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.149\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.292\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.914\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.335\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_SOC_Q2\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.103\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.233\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.905\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.828\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_SOC_Q3\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.269\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.288\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.924\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e4.965\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_SOC_Q4\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e3.291\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.318\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.873\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e3.975\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003c/tbody\u003e\u003c/table\u003e\u003c/div\u003e \u003cp\u003e\u003c/p\u003e \u003cp\u003eThe analysis also included an assessment of convergent validity (see Table\u0026nbsp;\u003cspan refid=\"Tab4\" class=\"InternalRef\"\u003e4\u003c/span\u003e), which revealed that all constructs had Cronbach’s alpha and CR values above 0.70, along with AVE values exceeding 0.50. These results are in line with the established benchmarks outlined by Hair et al. (\u003cspan citationid=\"CR21\" class=\"CitationRef\"\u003e2019\u003c/span\u003e), thereby confirming that the measurement model demonstrates acceptable reliability and convergent validity. Accordingly, the SEM model can be valid and specified from both reflective and formative measurement approaches.\u003c/p\u003e \u003cp\u003e \u003c/p\u003e\u003cdiv class=\"gridtable\"\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e\u003ctable float=\"Yes\" id=\"Tab4\" border=\"1\"\u003e\u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 4\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eDiscriminant validity with HTMT\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e\u003ccolgroup cols=\"4\"\u003e\u003c/colgroup\u003e\u003cthead\u003e\u003ctr\u003e\u003cth align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/th\u003e\u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003eCronbach's alpha\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003eComposite reliability (rho\u003csub\u003ec\u003c/sub\u003e)\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003eAverage variance extracted (AVE)\u003c/p\u003e \u003c/th\u003e\u003c/tr\u003e\u003c/thead\u003e\u003ctbody\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.953\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.954\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.811\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.951\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.952\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.805\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.948\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.948\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.793\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.943\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.945\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.777\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.958\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.958\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.826\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eICS\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.951\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.952\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.804\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003c/tbody\u003e\u003c/table\u003e\u003c/div\u003e \u003cp\u003e\u003c/p\u003e \u003c/div\u003e \u003cdiv id=\"Sec11\" class=\"Section2\"\u003e \u003ch2\u003eModel Goodness of Fit\u003c/h2\u003e \u003cp\u003eThe Standardized Root Mean Squared Residual (SRMR), f-square (f²), Normed Fit Index (NFI), and R-square (R²) were used to assess the model’s goodness of fit. The R² value for audit quality measures comprising (Expertise, Compliance, Skepticism, and Responsiveness) to ESG-Corporate Sustainability Performance is 0.806, indicating that these factors collectively explain 80.6% of the variance in ESG-corporate sustainability performance. Meanwhile, the internal control system demonstrates an R² value of 0.626, suggesting that it accounts for 62.6% of the variance in ESG-corporate sustainability performance.\u003c/p\u003e \u003cp\u003e The f-squared statistic, which measures the impact of each exogenous variable on the variance explained, was computed alongside SRMR and NFI to assess model fit, following the guidelines provided by Hair et al. (\u003cspan citationid=\"CR21\" class=\"CitationRef\"\u003e2019\u003c/span\u003e) and Khan et al. (\u003cspan citationid=\"CR32\" class=\"CitationRef\"\u003e2019\u003c/span\u003e). According to Hair et al. (\u003cspan citationid=\"CR21\" class=\"CitationRef\"\u003e2019\u003c/span\u003e) and Khan et al. (\u003cspan citationid=\"CR32\" class=\"CitationRef\"\u003e2019\u003c/span\u003e), acceptable thresholds include an f-squared value greater than 0.02, SRMR below 0.08, and NFI values approaching 1.0. As shown in Table\u0026nbsp;\u003cspan refid=\"Tab5\" class=\"InternalRef\"\u003e5\u003c/span\u003e, the SEM model meets these benchmarks, with all f-squared values indicating adequate effect sizes. In addition, model fit is confirmed by an SRMR of 0.039, below the recommended cut-off, and an NFI score of 0.815, exceeding the acceptable level of 0.80.\u003c/p\u003e \u003cp\u003e \u003c/p\u003e\u003cdiv class=\"gridtable\"\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c5\" colnum=\"5\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c6\" colnum=\"6\"\u003e\u003c/div\u003e\u003ctable float=\"Yes\" id=\"Tab5\" border=\"1\"\u003e\u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 5\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eModel performance and fit\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e\u003ccolgroup cols=\"6\"\u003e\u003c/colgroup\u003e\u003cthead\u003e\u003ctr\u003e\u003cth align=\"left\" colname=\"c1\"\u003e\u0026nbsp;\u003c/th\u003e\u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003eR-sequence\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003eR Square\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003eAdjusted R Square\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c5\"\u003e \u003cp\u003eSRMR\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c6\"\u003e \u003cp\u003eNFI\u003c/p\u003e \u003c/th\u003e\u003c/tr\u003e\u003c/thead\u003e\u003ctbody\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.041\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.068\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.085\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.022\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c3\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c4\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"left\" colname=\"c6\"\u003e\u0026nbsp;\u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eICS\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.806\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.800\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e0.039\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c6\"\u003e \u003cp\u003e0.815\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c2\"\u003e\u0026nbsp;\u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.626\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.618\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c5\"\u003e \u003cp\u003e0.039\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c6\"\u003e \u003cp\u003e0.815\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003c/tbody\u003e\u003c/table\u003e\u003c/div\u003e \u003cp\u003e\u003c/p\u003e \u003c/div\u003e \u003cdiv id=\"Sec12\" class=\"Section2\"\u003e \u003ch2\u003eHypotheses Results:\u003c/h2\u003e \u003cp\u003eFigure \u003cspan refid=\"Fig3\" class=\"InternalRef\"\u003e3\u003c/span\u003e below illustrates the hypothesized model, including both direct and indirect relationships. Correspondingly, Tables\u0026nbsp;\u003cspan refid=\"Tab5\" class=\"InternalRef\"\u003e5\u003c/span\u003e and \u003cspan refid=\"Tab6\" class=\"InternalRef\"\u003e6\u003c/span\u003e show T-statistic, coefficient, P-value, and hypotheses results for each relationship of the SEM model.\u003c/p\u003e \u003cp\u003e \u003c/p\u003e \u003cp\u003e \u003c/p\u003e\u003cdiv class=\"gridtable\"\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c5\" colnum=\"5\"\u003e\u003c/div\u003e\u003ctable float=\"Yes\" id=\"Tab6\" border=\"1\"\u003e\u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 6\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eResults of Direct Path Analysis and Hypothesis Testing\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e\u003ccolgroup cols=\"5\"\u003e\u003c/colgroup\u003e\u003cthead\u003e\u003ctr\u003e\u003cth align=\"left\" colname=\"c1\"\u003e \u003cp\u003ePath\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003eCoeff. (B)\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003eT-statistic\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003eP-value\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c5\"\u003e \u003cp\u003eHypotheses Results\u003c/p\u003e \u003c/th\u003e\u003c/tr\u003e\u003c/thead\u003e\u003ctbody\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP -\u0026gt; ESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.241\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e3.032\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.002\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH1a: Accepted\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP -\u0026gt; ESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.208\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e2.292\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.022\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH1b: Accepted\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK -\u0026gt; ESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e-0.127\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.213\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.225\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH1c: Rejected\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES -\u0026gt; ESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.350\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e3.386\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.001\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH1d: Accepted\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP -\u0026gt; ICS\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.270\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e2.706\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.007\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH2a: Accepted\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP -\u0026gt; ICS\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e-0.038\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.307\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.759\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH2b: Rejected\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK -\u0026gt; ICS\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.078\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.536\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.592\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH2c: Rejected\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES -\u0026gt; ICS\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.518\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e4.420\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.000\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH2d: Accepted\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eICS -\u0026gt; ESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.303\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e3.769\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.002\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH3: Accepted\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003c/tbody\u003e\u003c/table\u003e\u003c/div\u003e \u003cp\u003e\u003c/p\u003e \u003cp\u003e \u003c/p\u003e\u003cdiv class=\"gridtable\"\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c1\" colnum=\"1\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c2\" colnum=\"2\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c3\" colnum=\"3\"\u003e\u003c/div\u003e\u003cdiv align=\"char\" char=\".\" class=\"colspec\" colname=\"c4\" colnum=\"4\"\u003e\u003c/div\u003e\u003cdiv align=\"left\" class=\"colspec\" colname=\"c5\" colnum=\"5\"\u003e\u003c/div\u003e\u003ctable float=\"Yes\" id=\"Tab7\" border=\"1\"\u003e\u003ccaption language=\"En\"\u003e \u003cdiv class=\"CaptionNumber\"\u003eTable 7\u003c/div\u003e \u003cdiv class=\"CaptionContent\"\u003e \u003cp\u003eResults of Indirect Path Analysis and Hypothesis Testing\u003c/p\u003e \u003c/div\u003e \u003c/caption\u003e\u003ccolgroup cols=\"5\"\u003e\u003c/colgroup\u003e\u003cthead\u003e\u003ctr\u003e\u003cth align=\"left\" colname=\"c1\"\u003e \u003cp\u003ePath\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c2\"\u003e \u003cp\u003eCoeff. (B)\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c3\"\u003e \u003cp\u003eT-statistic\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c4\"\u003e \u003cp\u003eP-value\u003c/p\u003e \u003c/th\u003e\u003cth align=\"left\" colname=\"c5\"\u003e \u003cp\u003eHypotheses Results\u003c/p\u003e \u003c/th\u003e\u003c/tr\u003e\u003c/thead\u003e\u003ctbody\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_EXP -\u0026gt; ICS -\u0026gt; ESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.182\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e2.869\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.023\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH4a: Accepted\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_COMP -\u0026gt; ICS -\u0026gt; ESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.171\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e1.297\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.036\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH4b: Accepted\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_SK -\u0026gt; ICS -\u0026gt; ESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.023\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e0.515\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.607\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH4c: Rejected\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003ctr\u003e\u003ctd align=\"left\" colname=\"c1\"\u003e \u003cp\u003eAQ_RES -\u0026gt; ICS -\u0026gt; ESG_PER\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c2\"\u003e \u003cp\u003e0.257\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c3\"\u003e \u003cp\u003e3.102\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"char\" char=\".\" colname=\"c4\"\u003e \u003cp\u003e0.009\u003c/p\u003e \u003c/td\u003e\u003ctd align=\"left\" colname=\"c5\"\u003e \u003cp\u003eH4d: Accepted\u003c/p\u003e \u003c/td\u003e\u003c/tr\u003e\u003c/tbody\u003e\u003c/table\u003e\u003c/div\u003e \u003cp\u003e\u003c/p\u003e \u003cp\u003eThe hypothesis outcomes related to the direct impact of audit quality measures on ESG-corporate sustainability performance can be found in Table\u0026nbsp;\u003cspan refid=\"Tab6\" class=\"InternalRef\"\u003e6\u003c/span\u003e. In the first part of the hypotheses results, the hypotheses (H1a, H2b, and H1d) were accepted with significant \u003cem\u003eP\u003c/em\u003e-values and a coefficient of 0.241, 0.208, and 0.350, respectively, demonstrating substantive evidence of the relationships tested. However, hypothesis H1c was rejected as shown by a coefficient of -0.127 and a \u003cem\u003eP\u003c/em\u003e-value greater than 0.05, indicating no relationship was found where the \u003cem\u003ep\u003c/em\u003e-value was not significant. That means the audit quality measures (author’s expertise, compliance, and responsiveness) are significantly and positively associated with ESG-corporate sustainability performance, and conversely, the auditor’s skepticism is not significantly associated with ESG-corporate sustainability performance.\u003c/p\u003e \u003cp\u003eIn the second part of the hypothesis results showing the results pertaining the direct relationship of audit quality measures and internal control system, two hypotheses were validated (H2a and H2d) with significant (coefficient of 0.270 and 0.518 correspondingly, and \u003cem\u003ep\u003c/em\u003e-values \u0026lt; 0.05), demonstrate substantive evidence of the relationships tested. Conversely, the other two hypotheses (H2b and H2c) were rejected with non-significant (coefficient of -0.038 and 0.078 correspondingly, and \u003cem\u003ep\u003c/em\u003e-values \u0026gt; 0.05) indicating no significant evidence of the relationship tested. That means that the auditor’s expertise and responsiveness were found to be positively and significantly associated with internal control system, and conversely, the auditor’s compliance and skepticism were not significantly associated with internal control system. Finally, in the third part of the direct relationship tested, the internal control system is positively and significantly associated with ESG-corporate sustainability performance with a coefficient of 0.303 and a \u003cem\u003ep\u003c/em\u003e-value of 0.002, supporting H3. This provides evidence that the internal control system supports ESG-corporate sustainability performance.\u003c/p\u003e \u003cp\u003eHowever, the hypotheses results in Table\u0026nbsp;\u003cspan refid=\"Tab7\" class=\"InternalRef\"\u003e7\u003c/span\u003e present the indirect relationship between audit quality measures and ESG-corporate sustainability performance through the mediation of internal control system. In the results, all hypotheses (H4a, H4b, and H4d) were supported, except for H4c, where the \u003cem\u003ep\u003c/em\u003e-values indicated statistical significance, providing significant evidence for the mediating effect tested. However, the analysis of H4c indicated that the mediating role of the internal control system was not statistically significant, indicating no mediating role in this context. Specifically, the first hypothesis (H4a), which proposes that the internal control system significantly mediates the relationship between auditor expertise and ESG-corporate sustainability performance, was supported (coefficient = 0.182, \u003cem\u003ep\u003c/em\u003e-value = 0.023). This result indicates partial mediation, as the direct relationship remained significant but was reduced in magnitude. The second hypothesis (H4b) was supported (coefficient = 0.171, \u003cem\u003ep\u003c/em\u003e-value = 0.036), indicating that the internal control system significantly mediates the relationship between auditor compliance and ESG-corporate sustainability performance. Given that the direct effect (coefficient = 0.249) decreased when the internal control system acted as a mediator, partial mediation is indicated. In contrast, the third hypothesis (H4c) was not supported (coefficient = 0.023, \u003cem\u003ep\u003c/em\u003e-value = 0.607), suggesting that the internal control system does not significantly mediate the relationship between auditor skepticism and ESG-corporate sustainability performance. Additionally, the direct relationship in this case was non-significant, indicating the absence of mediation. Lastly, the fourth hypothesis (H4d) was confirmed, as the internal control system significantly mediates the relationship between auditor responsiveness and ESG-corporate sustainability performance (coefficient = 0.257, \u003cem\u003ep\u003c/em\u003e-value = 0.009). Since this mediation effect was smaller than the direct effect (coefficient = 0.350), partial mediation is also supported here.\u003c/p\u003e \u003c/div\u003e "},{"header":"Discussion and Conclusion","content":"\u003cp\u003eThis study examines the relationship between audit quality and ESG-corporate sustainability performance, mediated by the internal control system within Saudi-listed companies. The results revealed that auditor expertise, compliance, and responsiveness have a significant direct effect on ESG-corporate sustainability performance. This supports the findings of many of previous research (Junior et al., \u003cspan citationid=\"CR31\" class=\"CitationRef\"\u003e2014\u003c/span\u003e), where an increasing number of businesses are looking for outside expertise in order to validate the data that is incorporated into their non-financial reports. Further, auditors have experience and expertise in evaluating ESG-related factors because, as part of the audit of financial statements, they are required to consider any risk factor that could lead to an ESG-material misstatement (Asante-Appiah \u0026amp; Lambert, \u003cspan citationid=\"CR6\" class=\"CitationRef\"\u003e2023\u003c/span\u003e).\u003c/p\u003e\u003cp\u003eHowever, auditor skepticism did not show a significant effect, and this contrasts with several prior studies. For instance, Hurtt (\u003cspan citationid=\"CR30\" class=\"CitationRef\"\u003e2010\u003c/span\u003e) and Nelson (\u003cspan citationid=\"CR43\" class=\"CitationRef\"\u003e2009\u003c/span\u003e) emphasized the importance of skepticism in detecting irregularities and strengthening audit judgments. Similarly, Koo and Ki (2020) found that skeptical auditors enhance governance processes by identifying control weaknesses. The lack of significance in this study may be attributed to contextual and cultural factors in Saudi Arabia, where the exercise of professional skepticism may be constrained by hierarchical organizational structures or a lack of emphasis in training programs. In contrast, it was found that auditor expertise and responsiveness have a positive and significant association with the internal control system. This aligns with the findings of Harasheh and Provasi (\u003cspan citationid=\"CR25\" class=\"CitationRef\"\u003e2023\u003c/span\u003e), who noted that technically competent auditors contribute to stronger internal controls and financial reporting quality. Similarly, Koo and Ki (2020) emphasized that auditor expertise is critical in identifying risks and advising management on improving controls. Furthermore, a direct relationship between the internal control system and ESG-corporate sustainability performance was significantly supported and confirms previous studies that suggest effective internal controls are a backbone of credible sustainability disclosures (Napitupulu \u0026amp; Djaddang, \u003cspan citationid=\"CR42\" class=\"CitationRef\"\u003e2025\u003c/span\u003e; Shaiti \u0026amp; Al-Matari, \u003cspan citationid=\"CR49\" class=\"CitationRef\"\u003e2020\u003c/span\u003e).\u003c/p\u003e\u003cp\u003eFinally, as a study’s contribution, the results found that the internal control system significantly mediates the relationships between auditor expertise, compliance, responsiveness, and ESG-corporate sustainability performance, while this mediating effect was not found for auditor skepticism. This suggests that high-quality audits enhance ESG-corporate sustainability performance not directly, but through their influence on the internal control system. However, the absence of a mediating effect for auditor skepticism diverges from the expectations set by prior literature, again highlighting the need to revisit how skepticism is taught and practiced. The study results, therefore, point to a gap in awareness or application of skepticism within the Saudi audit profession and raise the need for context-specific professional development programs that clarify its constructive role.\u003c/p\u003e\u003cp\u003e While this study supports existing research on the positive roles of auditor expertise, compliance and responsiveness, it also reveals notable divergence concerning the role of skepticism. These findings stress the importance of tailoring audit quality development strategies to national and cultural contexts to optimize their impact on ESG-corporate sustainability performance. Additionally, the study contributes to providing empirical evidence that high audit quality plays a pivotal role in enhancing the ESG-corporate sustainability performance when the internal control system is active and solid, ensuring that ESG initiatives are not only effectively implemented but also accurately reported. Although the results of the study empirically and theoretically contributed to the existing literature, some limitations are to be reported. First, the sample in this study includes only the top 100 companies listed in Saudi Stock Exchange (TADAWUL), which may lead the results to have less generalizability to a smaller companies or non-listed companies that have different audit processes. Second, the cross-sectional data nature constrains the possibilities of inferring the cause-and-effect relationship between audit quality, internal control system, and ESG-corporate sustainability performance. Finally, questionnaire survey data may have response bias, specifically in technical concepts such as auditor skepticism. However, future research could explore empirical data across diverse company sizes and industry sectors, or conduct cross-country comparisons to examine how cultural and regulatory contexts influence the relationship between audit quality and ESG-corporate sustainability performance.\u003c/p\u003e"},{"header":"Declarations","content":"\u003cp\u003e \u003ch2\u003eEthics statements\u003c/h2\u003e \u003cp\u003e This study was conducted in accordance with the principles of the Declaration of Helsinki, and approval was granted by the Ethics Committee of Jazan University (Date: 24/12/2024/No. HAPO-10-Z-001). All participants were informed about the study\u0026rsquo;s purpose, assured of anonymity and confidentiality, and provided informed consent prior to participation. Written informed consent was obtained from all participants prior to completing the questionnaire survey, which was conducted online (via Google Forms) between December 2024 and March 2025.\u003c/p\u003e \u003cp\u003e\u003cstrong\u003eDeclarations of competing interests\u003c/strong\u003e\u003c/p\u003e\n\u003cp\u003eThe authors state that none of the work disclosed in this publication may have been influenced by any known conflicting financial interests or personal ties.\u003c/p\u003e\u003ch2\u003eFunding statement\u003c/h2\u003e \u003cp\u003eThe authors gratefully acknowledge the funding of the Deanship of Graduate Studies and Scientific Research. Jazan University, Saudi Arabia, through Project Number: RG24-S0197\u003c/p\u003e\u003ch2\u003eAuthor Contribution\u003c/h2\u003e\u003cp\u003eAuthor\u0026rsquo;s (1) Contribution:Mohammed AlfifyAssistant ProfessorDepartment of Accounting and Finance, Jazan University, Saudi ArabiaEmail: [email protected] Contribution: Research Idea, Conceptualization, Investigation, Data collection, Writing - Review \u0026amp; EditingAuthor\u0026rsquo;s (2) Contribution:Hussein H. Sharaf-AddinSenior LecturerDepartment of Management, Centre of Social Innovation (CoSI), Institute of Smart \u0026amp; Sustainable Living (ISSL), Universiti Teknologi PETRONAS, 32610 Seri Iskandar, Perak, Malaysia Email: [email protected] Contribution: Methodology, Data analysis, Writing - Original Draft, Final Draft Organization, Visualization\u003c/p\u003e\u003ch2\u003eAcknowledgement\u003c/h2\u003e\u003cp\u003eThe authors gratefully acknowledge the funding of the Deanship of Graduate Studies and Scientific Research. Jazan University, Saudi Arabia, through Project Number: RG24-S0197\u003c/p\u003e\u003ch2\u003eData Availability\u003c/h2\u003e\u003cp\u003eThe data utilized for this empirical study is available upon request.\u003c/p\u003e"},{"header":"References","content":"\u003cp\u003eAbu Bakar, M. A., Abdul Rahim, A., \u0026amp; Mohd Nasir, M. I. (2022). Understanding the Importance of Provisioning Ecosystem Services in Natural Resource-Dependent Poor Household: A Case Study of Jerlun, Kedah. \u003cem\u003eInternational Journal of Academic Research in Business and Social Sciences\u003c/em\u003e, \u003cem\u003e12\u003c/em\u003e(9), 339\u0026ndash;354. https://doi.org/10.6007/ijarbss/v12-i9/14492\u003c/p\u003e\n\u003cp\u003eAdeyanju, A. A., Tafirenyika, B., \u0026amp; Eegunjobi, R. (2024). 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Unlocking the potential of digital twins in supply chains: A systematic review. \u003cem\u003eSupply Chain Analytics\u003c/em\u003e, \u003cem\u003e7\u003c/em\u003e(August 2023). https://doi.org/10.1016/j.sca.2024.100075\u003c/p\u003e"}],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":true,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":false,"hideJournal":false,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":false,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":false,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"humanities-and-social-sciences-communications","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":false,"externalIdentity":"palcomms","sideBox":"Learn more about [Humanities \u0026 Social Sciences Communications](http://www.nature.com/palcomms/)","snPcode":"41599","submissionUrl":"https://submission.springernature.com/new-submission/41599/3","title":"Humanities and Social Sciences Communications","twitterHandle":"","acdcEnabled":true,"dfaEnabled":true,"editorialSystem":"stoa","reportingPortfolio":"Nature AJ","inReviewEnabled":true,"inReviewRevisionsEnabled":false},"keywords":"audit quality, internal control system, ESG-corporate sustainability performance, Saudi listed companies","lastPublishedDoi":"10.21203/rs.3.rs-7507109/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-7507109/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003e With increasing pressure on companies to enhance their environmental, social, and governance (ESG) reputation, auditing has become a critical tool for ESG compliance and accountability. Although the significance of audit quality in the promotion of corporate sustainability has been outlined by previous researchers, little has been said about the role of internal control system. This study fills this gap by examining the relationship between the audit quality and the ESG-corporate sustainability performance, with a particular emphasis on the mediating role of internal control system. A quantitative approach was applied by focusing on the top 100 largest companies listed in the Saudi Stock Exchange (TADAWUL). The results indicate that auditor expertise, compliance, and responsiveness play significantly affect ESG-corporate sustainability performance, without the same effect being detected for the auditor skepticism. Furthermore, auditor skills as well as responsiveness is positively associated with the internal control system that is also found to have a significant positive relationship with ESG-corporate sustainability performance. Notably, the internal control system was found to significantly mediate the relationship between auditor expertise, compliance, and responsiveness and ESG-corporate sustainability performance, but no mediating effect was found for auditor skepticism. This study contributes to the literature by revealing the mediating effect of internal control system, thereby enhancing the literature base in the field of study. Empirically, the study provides practical insights for stakeholders and policymakers on how audit quality through the internal control system can enhance ESG sustainability performance in the Saudi context.\u003c/p\u003e","manuscriptTitle":"Audit Quality and ESG-Corporate Sustainability Performance: Evidence on the Mediating Role of Internal Control System","msid":"","msnumber":"","nonDraftVersions":[{"code":1,"date":"2026-01-27 07:42:49","doi":"10.21203/rs.3.rs-7507109/v1","editorialEvents":[{"type":"communityComments","content":0},{"type":"decision","content":"Revision requested","date":"2026-04-07T12:47:27+00:00","index":"","fulltext":""},{"type":"editorInvitedReview","content":"","date":"2026-03-18T07:17:46+00:00","index":"hide","fulltext":""},{"type":"editorInvitedReview","content":"","date":"2026-03-16T22:23:05+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"311188641192144753710224209720288612138","date":"2026-02-08T18:57:17+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"237865739468375264527727077223133748936","date":"2026-02-01T15:43:49+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"222375528856596603749104327608384458783","date":"2026-01-29T14:36:39+00:00","index":"hide","fulltext":""},{"type":"reviewersInvited","content":"","date":"2026-01-22T08:12:28+00:00","index":"","fulltext":""},{"type":"editorInvited","content":"","date":"2026-01-16T07:23:51+00:00","index":"","fulltext":""},{"type":"editorAssigned","content":"","date":"2025-09-27T06:50:42+00:00","index":"","fulltext":""},{"type":"checksComplete","content":"","date":"2025-09-24T10:29:23+00:00","index":"","fulltext":""},{"type":"submitted","content":"Humanities and Social Sciences Communications","date":"2025-09-24T10:25:44+00:00","index":"","fulltext":""}],"status":"published","journal":{"display":true,"email":"[email protected]","identity":"humanities-and-social-sciences-communications","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":false,"externalIdentity":"palcomms","sideBox":"Learn more about [Humanities \u0026 Social Sciences Communications](http://www.nature.com/palcomms/)","snPcode":"41599","submissionUrl":"https://submission.springernature.com/new-submission/41599/3","title":"Humanities and Social Sciences Communications","twitterHandle":"","acdcEnabled":true,"dfaEnabled":true,"editorialSystem":"stoa","reportingPortfolio":"Nature AJ","inReviewEnabled":true,"inReviewRevisionsEnabled":false}}],"origin":"","ownerIdentity":"d0c78e36-7eee-4f61-939f-4b6eae33e617","owner":[],"postedDate":"January 27th, 2026","published":true,"recentEditorialEvents":[],"rejectedJournal":[],"revision":"","amendment":"","status":"under-review","subjectAreas":[{"id":61694603,"name":"Business and commerce/Business and management"},{"id":61694604,"name":"Social science/Business and management"},{"id":61694605,"name":"Business and commerce/Information systems and information technology"}],"tags":[],"updatedAt":"2026-04-12T14:53:16+00:00","versionOfRecord":[],"versionCreatedAt":"2026-01-27 07:42:49","video":"","vorDoi":"","vorDoiUrl":"","workflowStages":[]},"version":"v1","identity":"rs-7507109","journalConfig":"researchsquare"},"__N_SSP":true},"page":"/article/[identity]/[[...version]]","query":{"redirect":"/article/rs-7507109","identity":"rs-7507109","version":["v1"]},"buildId":"XKTyCvWXoU3ODBz1xrDgd","isFallback":false,"isExperimentalCompile":false,"dynamicIds":[84888],"gssp":true,"scriptLoader":[]}