Do Perceived Green Accounting Practices Influence Stakeholders' Trust: Evidence From Ghana

ABSTRACT Despite the growing attention on sustainability and transparency, little is known about how green accounting disclosure practices shape stakeholder perceptions in developing markets. Existing research has mainly centered on the financial outcomes of environmental disclosure, leaving a gap in understanding its socio‐relational effects, especially stakeholders' trust. This study investigates the impact of perceived green accounting practices on stakeholders' confidence, considering the mediating effect of corporate reputation and the moderating effect of third‐party environmental disclosure assurance in the geographic context of manufacturing and commercial banks in Ghana, drawing on stakeholder and legitimacy theories. This study utilized primary data collected from 589 participants from the various external stakeholders in Ghana using survey instruments. SmartPLS 4.0 software was used to conduct the study analysis by employing the Partial Least Squares Structural Equation Model (PLS‐SEM) approach. The study results revealed that perceived green accounting practices positively and significantly influence corporate reputation and stakeholders' confidence. Additionally, the study discovered that corporate reputation has a significantly positive mediating effect on the relationship between perceived green accounting practices and stakeholders' trust, while third‐party environmental disclosure assurance favorably and substantially moderates the relationship between perceived green accounting disclosure practices and stakeholders' trust. This study provides valuable insights to policymakers, business managers, and owners on how green accounting practices boost corporate reputation and stakeholders' confidence in developing economies.