Economic, Institutional and Governance Determinants of Environmental, Social and Governance Disclosure Quality in Zimbabwe: An Empirical Analysis

Abstract

The study investigates the economic, institutional and governance determinants of Environmental, Social and Governance (ESG) disclosure quality among firms in Zimbabwe, addressing the limited empirical evidence from institutionally constrained developing economies. Using panel data from Zimbabwe Stock Exchange listed firms, ESG disclosure quality is measured through content analysis of annual and sustainability reports based on an ESG disclosure index aligned with internationally recognised reporting frameworks. Multivariate regression analysis is employed to examine the influence of firm-level economic factors, institutional pressures and corporate governance attributes on disclosure quality. The findings indicate that firm size, profitability, foreign ownership and board independence are positively associated with ESG disclosure quality, while higher leverage and weak regulatory enforcement negatively affect disclosure practices. Institutional pressures and effective governance mechanisms are shown to play a significant role in enhancing ESG transparency. The study is limited to listed firms and relies on publicly available disclosures from a sample of 235 firm-year observations which may constrain the generalisability of the findings to unlisted entities and informal sustainability practices. While the sample size was considered statistically adequate for panel regression analysis and enhanced the robustness of the empirical results, the focus on listed companies restricts broader sectoral applicability. The study concludes that ESG disclosure quality in Zimbabwe is shaped jointly by economic capacity, institutional context and governance effectiveness, underscoring the need for stronger regulatory enforcement and improved governance structures. The novelty of the study lies in providing one of the first integrated empirical analyses of ESG disclosure quality determinants in Zimbabwe, thereby extending ESG disclosure literature to an under[1]researched African context.