FinTech innovation, ESG reporting quality, and information systems risk: Panel data evidence from financial institutions in emerging markets

This study examines the impact of Innovation of Fintech on the quality of ESG reporting on financial institutions on the developing market and emphasizes the mitigating risk of information systems (IS). Using 268 solid observations covering 2014–2023 we use OL, fixed effects, two-stage smallest squares and GMM estimates to solve heterogeneity, endogeneity and dynamic dependencies. The results show that FinTech’s innovation itself has an insignificant direct effect on the quality of ESG, while its risk management interaction is positive and significant. This shows that risk controls are effective increase the stability and transparency of ESG -controlled ESG procedures. In addition, IT infrastructure and digital culture positively affect ESG quality, while cyber security vulnerability has a negative effect. The findings emphasize that it is necessary to rugged to ensure a trustworthy and sustainable publication of ESG, especially because financial institutions on developing markets integrate advanced solutions into their ecosystems of news.