Sustainability Reporting Quality and Stakeholder Value Creation in Indonesia’s Digital Finance: The Mediating Roles of Trust and Reputation

Abstract

This study examines whether sustainability reporting quality (SRQ) functions beyond compliance by driving stakeholder value creation in Indonesia’s digital finance industry. Using an explanatory quantitative design with a firm-year unit of analysis, we analyze 312 firm-year observations from digital banks and fintech firms over 2019–2024. SRQ is operationalized through a rubric-based composite index (SRQI) capturing disclosure comprehensiveness, data quality, assurance level, and stakeholder engagement disclosure. Stakeholder value creation is assessed across economic (EVC), social (SVC), and environmental (ENV) dimensions. We test direct effects as well as mediation through stakeholder trust and corporate reputation, and moderation by regulatory sensitivity and firm size using structural modeling with bootstrapping procedures. The results indicate that SRQ positively affects EVC (β = 0.29, p < 0.001), SVC (β = 0.34, p < 0.001), and ENV (β = 0.22, p < 0.001). Mediation tests show significant indirect effects through stakeholder trust (β_indirect = 0.12–0.15, p < 0.001) and corporate reputation (β_indirect = 0.09–0.14, p < 0.001), suggesting that SRQ works through both informational credibility and perception-based mechanisms. Moderation results further show stronger SRQ effects under higher regulatory sensitivity and among larger firms. Overall, the findings position SRQ as a strategic governance signal that enhances stakeholder value creation in trust-sensitive, risk-exposed digital finance contexts, offering implications for managers and regulators to prioritize data consistency, traceability, material risk transparency, and credible assurance.