Cogent Business & Management

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Does stakeholder pressure influence firms

environmental, social and governance (ESG)
disclosure? Evidence from Ghana

Noha Alessa, John Yaw Akparep, Inusah Sulemana & Andrew Osei Agyemang

To cite this article: Noha Alessa, John Yaw Akparep, Inusah Sulemana & Andrew Osei
Agyemang (2024) Does stakeholder pressure influence firms environmental, social and
governance (ESG) disclosure? Evidence from Ghana, Cogent Business & Management, 11:1,
2303790, DOI: 10.1080/23311975.2024.2303790

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Cogent Business & Management
2024, VOL. 11, NO. 1, 2303790
https://doi.org/10.1080/23311975.2024.2303790

 CCOUNTING, CORPORATE GOVERNANCE & BUSINESS

A
ETHICS | Research Article

Does stakeholder pressure influence firms environmental, social and

governance (ESG) disclosure? Evidence from Ghana
Noha Alessaa, John Yaw Akparepb, Inusah Sulemanac and Andrew Osei Agyemangb
a
Department of Accounting, College of Business Administration, Princess Nourah bint Abdulrahman University, Riyadh, Saudi
Arabia; bSchool of Business, S.D. Dombo University of Business and Integrated Development Studies, Wa, Ghana; cSchool of
Business and Law, University for Development Studies, Tamale, Northern Region, Ghana

ABSTRACT ARTICLE HISTORY

In the era of climate change, stakeholders are becoming more concerned about the Received 9 October 2023
sustainability disclosure of businesses. However, for developing economies like Ghana, Revised 1 January 2024
studies on stakeholders’ pressure and sustainable development has not received much Accepted 4 January 2024
attention. Hence, this study examines the influence of stakeholders’ pressure on KEYWORDS
sustainability disclosure and employed green technological innovation (GTI) as a Developing economy;
mediating factor. The study focused on mining and manufacturing firms because their green technological
processes are known to release carbon dioxide, create waste. The data utilize in this innovation; stakeholders
study was collected from 383 respondents in Ghana via online questionnaires. PLS-SEM pressure sustainability
was used to analyze the data and tested the hypothesis for the study using SMART-PLS disclosure
4. The results demonstrated that stakeholder pressure substantially improves REVIEWING EDITOR
sustainability disclosure performance. Also, the results revealed that a firm’s GTI mediates Collins Ntim, University of
the connection between stakeholder pressure in terms of shareholder and consumer Southampton, United
pressures. However, government pressure and sustainability disclosure were found to Kingdom of Great Britain
be insignificant. The study recommends that managers should incorporate GTI into the and Northern Ireland
product design and manufacturing process since it enables firms not only fulfill their SUBJECTS
client’s needs but also reduce their environmental impacts, like the production of Accounting (Sustainability
carbon dioxide and solid debris. Reporting)

1. Introduction
Almost all of the world’s largest firms now regularly provide sustainability reports that outline their oper-
ations and the impacts they have had in the areas of environment, society, and governance (Agyemang
et al., 2023a). Major firm publishes its annual report detailing the impacts of their business operations
on society, the environment, and the economy (Wiredu et al., 2023). Environmental, social, and gover-
nance (ESG) disclosure has increased in importance for almost all economies as people throughout the
world are concerned about the global ecological challenges and the associated need to preserve the
ecosystem. Hence, several firms are trying to be more accountable and environmentally friendly. To
clearly understand and share their effect on ESG concerns, businesses and governments around the
world seek guidance from groups like the Global Reporting Initiative (GRI). Even as firms may devise
strategies to enhance their ESG reporting to compete in the global market, stakeholders may put pres-
sure on businesses to reveal more ESG information.
A firm may show the public that it is not running its operations just for profit at the expense of its
responsibilities to its customers, workers, the environment, and society by reporting ESG reports. There
are several advantages to incorporating sustainability into business strategy and practices and enhancing
sustainability reporting, including increased transparency, enhanced brand value, improved reputation
and legitimacy, increased employee and customer loyalty, lower costs, better business practices, improved

CONTACT Inusah Sulemana [email protected] School of Business and Law, University for Development Studies, Tamale, Ghana
© 2024 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group.
This is an Open Access article distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/), which
permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. The terms on which this article has been
published allow the posting of the Accepted Manuscript in a repository by the author(s) or with their consent.
2 N. ALESSA ET AL.

firm performance and valuation, and the creation of competitive advantage (Sanchez-Planelles et al.,
2020, Menassa & Dagher, 2020).
Firms in developing economies are increasingly under scrutiny from owners and other interested par-
ties who want to know more about the value they provide and the consequences of their actions for
the natural world and the community. A more transparent and consistent reporting system has also been
highlighted as an area of emphasis to improve the performance of firms and attract investors to the
firms (Mensah et al., 2017). Hence, businesses are becoming more transparent about their sustainability
practices and adopting stricter measures of self-regulation as a consequence of stakeholder engagement
(Maama & Mkhize, 2020). Thus, firms’ ESG disclosure must evolve and advance due to a growing recog-
nition that the opportunities and issues facing a firm’s long-term value are far more nuanced and com-
plex than financial statements alone can capture.
Previous studies have paid attention to stakeholder demands since they are the primary driver of
sustainability (Higgins et al., 2020; Lulu, 2021). However, none of these studies considered the mediating
role of technological innovation which is a major factor of sustainability reporting. Moreover, (Ramadhini
et al., 2020; Krasodomska & Zarzycka, 2021) studies were centered on developed economies using sec-
ondary data and relying on the EKC theory. To the best of our knowledge, none of the earlier studies
have considered developing economies especially from Sub-Saharan Africa (SSA). Despite the premise
that, a firm can have a beneficial and adverse impact on its various stakeholder groups, few of the stud-
ies focused on stakeholder pressure and ecological reporting for developed economies. Additionally,
incompatible proof exists regarding the impact of particular stakeholder demands even though previous
studies have found that stakeholder pressures generally influence sustainability disclosure (Rudyanto &
Veronica Siregar, 2018). This necessitates more investigation into the relationship between stakeholders
pressures (SP) and sustainability disclosure (SD) using primary data from a developing country in SSA.
Also, it is not explicit how SP affects SD in existing literature, which is an open question in this study.
The few known studies have centered on transparency and the value of sustainability reports (Higgins
et al., 2020; Lulu, 2021). Therefore, the goal of this study is to close a gap between existing studies by
examining how pressure from stakeholders affects the degree of SD in Ghana.
This study aims to investigate how stakeholder pressure influences sustainability disclosure in Ghanaian
traded firms. The unique goals of the study are identifying the influence of stakeholder pressure on
sustainability disclosure in a developing economy in SSA. Establishing the impact of stakeholder pres-
sures on green technological innovation. Examining the mediating role of green technological innovation
between stakeholders’ pressure and sustainability reporting.
The theoretical inspiration of the study is rooted in stakeholder theory and institutional theory. The
stakeholder theory, suggest that firms are influenced by the expectations and demands of various stake-
holders, while institutional theory emphasizes the importance of external forces, cultural expectations
and institutional norms in determining corporate behaviors. By incorporating these two theories shed
lights on how different stakeholders influence firms’ behavior.
To better understand how stakeholder pressure affects sustainability reporting, the study relied on
first-hand data and utilized the partial least squares structural equation model method. The data analysis
was conducted using Smart PLS, version 4.0 which the authors have obtained a copyright license. The
results revealed that stakeholder, government, and customer pressures significantly influence sustainabil-
ity disclosure performance. Also, the study discovered that green technological innovation plays a signif-
icant mediating role between shareholder pressure, customer pressure, and sustainability disclosure, and
an insignificant mediating role between government pressure and sustainability disclosure. The outcome
of the study throws light on the different stakeholders’ pressure on sustainability disclosure and provides
policy guide for businesses on which of the stakeholders’ pressure to consider so as to improve sustain-
ability disclosure.
This study’s originality cannot be overstated; it adds to the existing work of knowledge regarding
stakeholder pressure and sustainability disclosure in distinct ways. First, to the best of our knowledge,
the relationship between stakeholder pressures and green technological innovation has not been thor-
oughly examined in developing economies. This study therefore offers an in-depth insight into how
green technological innovation mediates the relationship between stakeholder pressure and sustainabil-
ity disclosure in a developing economy. This differs from earlier studies that only looked at the direct
 Cogent Business & Management 3

impact (Lulu, 2021, Vitolla et al., 2019, Ramadhini et al., 2020). Hence, the study bridges the gap between
technological innovation adoption and sustainability practices, recognizing the pivotal role of green tech-
nological innovation in shaping a firm environmental, social and governance disclosure. This integration
is crucial for contemporary businesses navigating the intersection of technology and sustainability.
Second, the study’s originality lies in incorporating both process and product innovations within the
realm of green technological innovation. Many studies on ESG disclosure focuses predominantly on prod-
uct innovation (Li et al., 2018, Jayaraman et al., 2023), often overlooking the significance of process
innovation in contributing to sustainable business practices. This dual focus adds complexity and depth
to the analysis, recognizing that a firms’ environmental and social effects and reporting can be signifi-
cantly influenced by innovation in the product and the process in which it operates.
Consequently, the current paper seeks to make the following contributions to the existing literature.
First by introducing green technological innovation as a mediating variable, the study contributes to a
more advanced understanding of the mechanisms through which stakeholder pressure influences ESG
disclosure. It goes beyond establishing a direct relationship and explores the role of technological-driven
sustainability initiatives in mediating this influence.
Second, by focusing on Ghana, the study adds a contextual dimension to institutional theory, acknowl-
edging that the regulatory and normative environment in emerging markets may differ significantly from
that of developed economies, hence contributing to the broader understanding of how institutional fac-
tors interact with stakeholder pressures to shape ESG disclosure practices in a diverse global setting.
Third, the study’ inclusion of both process and product innovations as components of green techno-
logical innovation provides a holistic view. This recognition acknowledges that sustainable practices
extend beyond the final product and encompasses the entire production process. Such a comprehensive
perspective contributes to a more nuanced understanding of the ecofriendly initiatives within firms.
Fourth, the study’s results of a positive and significant influence of stakeholder pressure on ESG dis-
closure contributes empirical validation to existing literature that suggest a similar relationship. This sup-
ports and reinforces the idea that stakeholder pressure serves as a catalyst for increased transparency
and disclosure in environmental social, and governance domains.
The authors divided this article into seven distinct components. Section 1 provided an introduction.
Section 2 looks at the contextual factors by leveraging regulatory policies and requirements of ESG dis-
closure practices and advancements. Section 3 pertains to the theoretical literature review. Section 4
entails an empirical review of relevant studies, formulating hypotheses, and establishing a conceptual
framework. The research design for the study is elaborated on in section five. The sixth section of the
study presents the empirical results and provides a comprehensive analysis and discussion of the
obtained data. The seventh section encompasses a concise summary and a sweeping conclusion.

2. Background
Recently, there has been a notable transformation in the global business environment, characterized by
a growing focus on corporate responsibility and sustainability practices (Imperiale et al., 2023). In con-
temporary business evaluation, firms are no longer assessed based only on their financial success; their
influence on the environment, society, and governance practices is now considered (Cicchiello et al.,
2023). The emerging of the ESG framework has been a direct consequence of this revolution. This frame-
work is an evaluative tool for assessing a firm’s dedication to sustainable practices and ethical conduct
(Abeysekera, 2022).
Ghana, a country in West Africa, has seen tremendous economic expansion and advancement lately.
Corporate social responsibility and sustainable practices are becoming increasingly important as the
nation develops (Tetteh et al., 2024). Ghana’s business environment is distinguished by a blend of tradi-
tional and modern sectors, which mirrors the country’s many economic pursuits. Ghana has witnessed
an increasing focus on adopting sustainable business practices, evidenced by the implementation of
regulatory frameworks and policy initiatives (Wiredu et al., 2023). The government has been aggressively
advocating for the preservation of the environment, promoting social responsibility, and implementing
good governance. This phenomenon is apparent in the formulation and execution of rules and regula-
tions designed to incentivize enterprises to embrace and divulge environmental, social, and governance
4 N. ALESSA ET AL.

(ESG) practices (Faseyi et al., 2023). The implementation of the Ghana Green Label Certification Scheme
and the regulatory measures imposed by the Environmental Protection Agency, such as environmental
impact assessments, exemplify the government’s dedication to promoting environmentally sustainable
business practices (Otitolaiye et al., 2023). The Ghana’s Securities and Exchange Commission has under-
taken initiatives to incorporate Environmental, Social, and Governance (ESG) factors into firm reporting,
thereby conforming to prevailing international patterns. Listed firms are now required by the Securities
and Exchange Commission (SEC) to publish their ESG practices in their annual reports (Kaur, 2021). The
purpose of these standards is to guarantee that businesses provide stakeholders with accurate, trust-
worthy, and comparable ESG information (Jahid et al., 2023). SEC is a significant force behind promoting
ESG disclosure among businesses. Firms are encouraged to provide pertinent information about their
environmental effect, social activities, and corporate governance practices using rules and regulations
published by the SEC (Annan, 2023).
Ghana has undergone economic reforms to attract foreign investment and promote sustainable invest-
ment. These reforms are initiatives to enhance accountability, transparency, and corporate governance
(Anaman et al., n.d.). Ghana’s business community increasingly realizes the importance of following global
best practices to boost competitiveness and access outside markets (Simpson et al., 2022). Hence, ESG
disclosure in Ghana goes beyond merely abiding by the rules and regulations (Annan, 2023). It is an
opportunity for firms to show that they are dedicated to sustainability, ethical business conduct, and
generating long-term value for all parties involved. Firms may improve their reputation, draw in socially
aware investors, and support Ghana’s general sustainable growth by providing ESG information. ESG dis-
closure is an essential aspect of corporate transparency and accountability in Ghana (Appiah-Konadu
et al., 2022). It enables firms to communicate their commitment to environmental stewardship, social
responsibility, and strong corporate governance practices. The increasing desire for openness and stake-
holder accountability is a crucial driving force behind adopting ESG disclosure practices in Ghana
(Aboagye‐Otchere et al., 2020). There is a growing emphasis among investors, consumers, workers, and
the general public on the environmental and social consequences of organizations alongside their gov-
ernance strategies (Faseyi et al., 2023). Ghanaian enterprises acknowledge the need to cultivate trust,
maintain a favorable image, and attract enduring investments by disclosing their environmental, social,
and governance (ESG) performance (Jahid et al., 2023).
Moving forward the nation has a profound cultural legacy that places importance on active participa-
tion within society, managing the environment, and fulfilling social obligations (Welbeck, 2017). Numerous
Ghanaian enterprises acknowledge the significance of harmonizing their operational strategies with pre-
vailing cultural norms (Arthur et al., 2017). Consequently, they place a high priority on disclosing their
environmental, social, and governance (ESG) practices as a means to showcase their dedication to foster-
ing sustainable development. In addition, it is noted that some sectors, including mining and agriculture,
substantially influence the natural environment and nearby populations (Amoako et al., 2022). These
sectors are seeing heightened scrutiny to publicly report their environmental, social, and governance
(ESG) performance and address adverse social and ecological consequences (Famiyeh et al., 2021).

3. Theoretical literature review

In the following sub-sections, the theoretical justification is presented.

3.1. Stakeholder theory (ST)

Stakeholder theory is one of the most common ideas to explain why firms report on ESG issues. The
stakeholder theory states that businesses have duties to all other stakeholders interested in the business
besides owners, whose only goal is to make as much profit as possible (Freeman, 1984). According to
stakeholder theory, this goal cannot be reached by ignoring the needs of other stakeholders. This means
that while firms are responsible to their investors or stakeholders, they must also balance the interests
of many different stakeholders whose actions can affect or be affected by the firms’ actions (Dissanayake
et al., 2019). To demonstrate to stakeholders that their expectations are being acknowledged, firms
 Cogent Business & Management 5

actively participate in and provide an account of environmental, social, and governance (ESG) matters.
This may be done by including it in the annual reports or by producing separate sustainability reports
(Abeysekera, 2022). Businesses strive to minimize information asymmetry by reporting non-financial mat-
ters such as social and environmental activities and repercussions to convey ESG information effectively
(Alsahali & Malagueño, 2022). ESG reporting is used as a means of actively involving various stakeholder
groups that are considered vital for the organization’s ongoing operations.
Organizational managers are compelled by stakeholder theory to respond more quickly to the out-
side world’s demands. Thus, stakeholder theory states that firms should act in a good and fair way
towards stakeholders’ expectation, based on what the stakeholders think is right. It builds on legitimacy
theory, which also focuses on firms behaving ethically (Osei et al., 2023). Stakeholders lead organization
managers by advising them on how to live the firm’s values (Wen et al., 2023). This orientation helps
them discern between right and sinister. Stakeholders provide an orientation to help firms preserve and
maintain the quality of life while continually improving it, such that it becomes critical to how busi-
nesses approaches the environment in their operations and disclose sustainability information (Zhou
et al., 2022).
According to stakeholder theory, businesses should prioritize cultivating positive relationships with all
stakeholders (Osei et al., 2019). Thus, firms may be prompted to adopt and release sustainability reports
in response to pressure from stakeholders. The firm’s sustainability reports are meant to be comprehen-
sive sources of data on how the business’s operations affect the local community and the natural envi-
ronment. Firms declare their efforts towards the global objectives as a means of discharging their
responsibilities and gaining the approval and support of stakeholders.
Studies related to ESG often use ST as an important theoretical framework. According to Agyemang
et al. (2023b), to ensure firm sustainability, the firm must meet the expectations of its associates. The
intricacy of ESG issues requires the involvement of many different parties if effective or sustainable
answers are to be devised (Freudenreich et al., 2020). As a result of competing interests, leaders often
must decide which ones to prioritize, ignore, back, or fulfill. Stakeholder interest balance is thus an
important aspect to firms.

3.2. Institutional theory

Institutional theory provides a holistic explanation on why a firm chooses a specific structure or method
of reporting. Businesses whose principal activity is linked with greater ecological effects, like the mining
sector, undergo greater pressure to operate ethically in the manner they do business than those with
fewer ecological consequences (Simoni et al., 2020).
According to institutional theory, entities within the same field tend to grow increasingly similar to
one another due to the pressures they face, which include adopting institutional as well as social norms
and standards to gain legitimacy to preserve access to resources. Isomorphism is a term used to describe
this kind of standardization, and several types have been identified by: coercive (regulatory), mimetic
(competition), and normative (market) (Kılıç et al., 2021).
Coercive isomorphism arises when a firm is subjected to pressure from outside sources, such as share-
holders or employees, or from the national decision and laws to alter its long-standing institutional
norms (Herold, 2018). A firm may engage in mimetic isomorphism if its leaders believe that doing so
would provide them an edge in the marketplace (Kılıç et al., 2021). One example of this is the adoption
of corporate social responsibility reporting. Firms around the world are increasingly turning to the GRI
standards for SD as an example of normative isomorphism, which refers to the pressure to implement
organizational practices resulting from shared beliefs, typically from clients or vendors who require com-
pliance with ecological and social standards (Tran & Beddewela, 2020).
According to institutional theory, a firm’s corporate strategies are significantly impacted by its institu-
tional environment, which consists of its rules, conventions, and social beliefs (Posadas et al., 2023).
Nonetheless, this idea is comparable to the strategy supported by legitimacy theory. Similarly, Simoni
et al. (2020) argued that, businesses must adhere to regional social norms, values, and beliefs to prosper.
Building on this idea, institutional theory represents that a firm’s activities, efforts, and reports may lead
to stakeholders having certain expectations. Therefore, implementing sustainability practices means
6 N. ALESSA ET AL.

abiding by laws, social conventions, and values to enhance or preserve a firm’s reputation among stake-
holders (Alatawi et al., 2023).

4. Empirical review and hypotheses development

4.1. Stakeholder pressure and sustainability disclosure
The study of the factors that influence sustainability reports from businesses might benefit from the
theoretical groundwork provided by stakeholder theory. According to stakeholder theory, managers may
use stakeholders’ expectations (or output restrictions) as a benchmark for environmental performance
when they see widespread consensus on the importance of environmental concerns (Sarkis et al., 2010).
Efforts to incorporate environmental concerns and practices into strategic, tactical, and operational
actions have increased as a response of rising challenges. Similarly, the legitimacy theory argues that
businesses’ social practices should emphasize how firms respond to community expectations. As a result,
a firm may need to explain how its actions align with social values since the community or stakeholders
may react negatively, especially when there are discrepancies between firm and societal values (Alatawi
et al., 2023). Therefore, businesses must adapt to societal demands to uphold their social standing and
cultivate a relationship based on trust with stakeholders. Firms can better anticipate societal concerns by
disseminating and publishing information about their sustainability issues in publicly accessible reports
(Alatawi et al., 2023).
Stakeholder theory was considered by Sarkis et al. (2010) while analyzing the implementation of sus-
tainable measures in the Spanish automobile sector. Their results suggested that stakeholders may have
varied effects given the particular scenario under consideration. Thus, there is a significant association
between environmental demands across stakeholders and various groups’ stakeholder pressures on sus-
tainability practices.
Every decision made by the firm is a direct reflection of the majority shareholder’s desires (Raub &
Martin-Rios, 2019). Therefore, shareholders need to exercise effective oversight of the firm’s management
to decrease instances of concealing information and promote more comprehensive disclosures. Firms are
being pushed to consider their broader social and environmental impacts as a result of shareholder
pressure on sustainability, which is a welcome trend.
Investors are beginning to see the potential of sustainability as a tool for creating a more equal and
just society as well as a safer and more prosperous one. As a consequence, stakeholders are utilizing
their voting power and other forms of influence to pressure businesses to improve their ESG effective-
ness (Cadez et al., 2019, Lee et al., 2018). The results by Chithambo et al. (2022) demonstrate that
stakeholder pressure, as represented by environmental, consumer, employee, and shareholder pressures,
significantly affect the environmental performance of manufacturing businesses listed on the Indonesia
Stock Exchange (ISE).
Government regulations are crucial factors for businesses to consider. Permits for doing business,
labor laws, and other requirements have all been promulgated by various state institutions. As a result
of increased public scrutiny and demands transparency, state authorities are putting pressure on busi-
ness leaders to provide sustainability reports (Lestari et al., 2021). The government and regulations
may use a variety of tools to encourage businesses to take environmental protection measures. The
advent of emission limits and environmental programs has put considerable regulatory pressure on
many businesses in developed countries. Without the effect of legislation to force their acceptance,
certain industries, like the energy industry, would not even be in existence. The use of force is often
implicit in regulatory efforts. Because of the risk of fines, jail time, or other legal repercussions, busi-
nesses are compelled to comply with legal pronouncements by instituting internal sustainability poli-
cies that reduce emissions, resource usage, and waste during production (Esfahbodi et al., 2017).
Moreover, rules place stress on businesses by necessitating the development of organizational respon-
sibility reports that detail the infirm of external and internal sustainability measures. Hence, it stands
to reason that coercive constraints from governments and regulators would have a detrimental impact
on supplier sustainability cooperation, although some academics have claimed otherwise (Talbot
et al., 2021).
 Cogent Business & Management 7

Customers are often regarded as the most influential stakeholder group (Chithambo et al., 2022). The
ecological impact of products is increasingly communicated to consumers. Ecologically conscious cus-
tomers are willing to pay more for green items that are offered by firms with a strong ecological repu-
tation. So, there is an incentive for suppliers to implement sustainable practices to enhance their market
performance and meet the needs of their customers. Customers on the B2B level often mandate that
vendors have environmental certifications like ISO 14000. Recent studies by Gong et al. (2019) shows that
consumer demands are crucial for encouraging businesses to build their sustainability capabilities and
communicate sustainability to their supply chain collaborators through the use of various stakeholders’
pressure. Thus, it is anticipated that the adoption and execution of both inside and outside green initia-
tives would be favorably impacted by demands from customers. According to studies conducted by
Ramadhini et al. (2020), external stakeholders, such as creditors and the media, impact social and envi-
ronmental disclosure. In addition, studies by Fernandez-Feijoo et al. (2014) found that pressure from
specific stakeholder groups—including customers, clients, employees, and the environment—raises the
bar for report openness.
Based on the above literature, the following hypotheses are developed:
H1. Shareholder pressure significantly influences sustainability disclosure.
H2. Government pressure has a positive and significant influence on sustainability disclosure.
H3. Customer pressure has a positive and significant link with sustainability disclosure.

4.2. Stakeholder pressure and green technological innovation

The institutional theory focuses on how the outside world affects green technologies. Green innovation
may be seen from the perspective of analytical logic as a method of dealing with the demands of the
customers and regulatory pressure. The goal is to make businesses adhere to social norms, regulatory
requirements, and public perception (Berrone et al., 2013).
Studies conducted by Rui and Lu (2021) used a sample of 278 businesses to explore the driving
mechanism of stakeholders’ regulatory, normative, and imitation pressures on firms’ green innovation,
respectively. These three types of pressure come from the government, consumers, and rivals. The results
of hierarchical regression analysis indicate that pressure from stakeholders may improve the environmen-
tal ethics of firms and the development of green technology. Similarly, Tian and Tian (2021) conducted
a study to examine how green innovation emerges and affects a firm’s environmental performance. The
empirical study results using 306 firms sample data demonstrate that stakeholder pressure favors firm
sustainability performance and that responsible innovation is a partial mediating factor in this connec-
tion. In addition to confirming the logic of stakeholder theory, which predicted that stakeholder pres-
sures would have a significant impact on firms’ decisions about green innovation (Cadez et al., 2019, Lee
et al., 2018), this finding also extends it by illuminating the heterogeneous influences of various stake-
holder pressures on green product innovation.
Following to the stakeholder theory, organizations should prioritize meeting the demands and expec-
tations of all constituencies rather than just those of shareholders with financial stakes (Freeman, 1984).
Hence, firm now includes green innovation strategies in its policies. Shareholder pressure on sustainabil-
ity describes the rising movement of shareholders, notably institutional shareholders, to require busi-
nesses to disclose their ESG results and prioritize green technological innovations initiatives. As a
consequence, shareholders are utilizing their voting power and other forms of influence to pressure busi-
nesses to improve their green technological innovation (Kılıç et al., 2021). Thus, firms are being pushed
to consider their broader social and environmental impacts as a result of shareholder pressure on green
technological innovation adoption, which is a welcome trend.
Government pressure often describes governmental restrictions upon businesses, like environmental
laws. Businesses must cease engaging in environmentally harmful activities and adopt green technolog-
ical innovation practices to avoid government penalties and preserve regulatory flexibility. Numerous
studies have supported this idea. For instance, it was discovered via a study of 92 industrial firms in
Germany that the rigor of statutory ecological rules increased the possibility of implementing green
innovation (Kammerer, 2009). In order to compete internationally, businesses must also adhere to
8 N. ALESSA ET AL.

international environmental conventions. As a result, adopting green technological innovation will directly
depend on how stringent the regulations are and how the firms perceive them.
According to the stakeholder theory, customer pressure and regulations may spur businesses to adopt
green technological innovations. Firms may satisfy customers’ expectations and requests to lessen their
ecological effects by introducing green technological innovation products and green processes. According
to Lin and Ho (2011), consumer pressure is the degree to which consumers anticipate or pressure busi-
nesses to enhance their environmental performance—it has been recognized as a critical factor in adopt-
ing green innovation by firms. In the study by Lestari et al. (2021) on the effects of consumer demand
and environmental legislation on green innovations, customer pressure has a very beneficial impact on
green technological innovation performance. Also, Lulu (2021) discovered a more prominent favorable
association between consumer pressure and the businesses’ environmental initiatives. In a similar vein,
third-party logistic providers’ green developments were seen to be primarily influenced by consumer
pressure (Chu et al., 2019). According to the results of empirical study done by Esposito De Falco et al.
(2021), contractual stakeholders have a more significant influence on environmental innovation. It is also
discovered by Jayaraman et al. (2023), that stakeholders such as employees, suppliers, government reg-
ulations, and customers significantly impact an organization’s sustainability performance, particularly
regarding green technological innovation initiatives indicating that stakeholders play a vital role regard-
ing the implementation of green innovation and believe such an act could help in minimizing environ-
mental impact. A further study has supported that the influence of stakeholders on do impact firms in
adopting green innovation (Thomas et al., 2022). Therefore, we hypothesize that;
H4. Shareholder pressure has a significant impact on green technological innovation.
H5. Government pressure has a significant impact on green technological innovation.
H6. Customer pressure has a significant impact on green technological innovation.

4.3. The mediating role of green technological innovation (GTI)

GTI describes the creation and widespread use of new technologies that help preserve the planet (Zhang
et al., 2020). New products, processes, or services developed to lower greenhouse gas (GHG) emissions,
conserve natural resources, and advance sustainable development are examples of such innovations. The
utilization of renewable energy sources, for instance, may assist to decrease GHG emissions and prevent
climate variability, while green building methods can help to lessen the ecological effect of the construc-
tion (Agyemang et al., 2021). Innovation in environmentally friendly technologies is crucial to long-term
viability since it helps mitigate adverse environmental impacts while also opening up lucrative new mar-
kets. Thus, reducing carbon emissions, preserving natural resources, and encouraging eco-friendly prac-
tices across sectors are all ways in which green technical innovation contributes to sustainability (Raihan,
2023). By facilitating the development and adoption of sustainable practices across sectors, GTI has a
major impact on environmental sustainability.
Due to pressure from stakeholders and regulatory standards, firms adhere to pollution reduction,
energy efficiency policies, and other environmentally conscious practices (Amoah & Eweje, 2020). By
adopting and promoting sustainable technologies, enterprises can fulfill stakeholder expectations and
actively contribute to global endeavors to address and mitigate the effects of climate change (Cadez
et al., 2019). The application of advanced carbon capture and storage technologies has made it possible
to store carbon dioxide emissions from power plants and industrial processes (Dhanda et al., 2022). This
responds to stakeholder demand for concrete action to reduce carbon emissions and mitigate climate
change by preventing the release of carbon dioxide.
Stakeholders’ advocacy for sustainability drives the heightened utilization of renewable energy sources
such as solar and wind (Cadez et al., 2019) and investment in carbon capture and storage innovations
to reduce their carbon footprint by absorbing and storing carbon emissions, hence improving the quality
of the climate (Cadez & Guilding, 2017). An empirical study by Seroka-Stolka (2023) revealed a positive
correlation between stakeholder pressure and the implementation of decarbonization strategies and per-
formance linked to carbon emissions. From the standpoint of stakeholder theory, corporations operating
in industries that significantly affect global warming are subject to greater public scrutiny. As a result,
 Cogent Business & Management 9

these firms are more inclined to disclose their performance in addressing climate change in response to
demand from stakeholders (Liesen et al., 2015, Cadez & Czerny, 2016). Hence, it is hypothesized that:
H7. Green technological innovation mediates the association between shareholder pressure and sustainability
disclosure.
H8. Green technological innovation mediates the link between government pressure and sustainability disclosure.
H9. Green technological innovation facilitates the link between customer pressure and sustainability disclosure.

5. Methodology
5.1. Research design
Using a quantitative research methodology, the study investigated the influence of stakeholder pressure
on ESG disclosure. We utilized primary data since it has higher validity due to its lack of human involve-
ment, enhanced interpretation, attention to pertinent research questions, and data decency (Wiredu
et al., 2023). Survey questions were created to collect data for the study. A five-point Likert scale, ranging
from strongly disagree to strongly agree, was used in the surveys. It was done to meet the study’s goals.
Before the pilot test, an instrument pre-test was carried out after creating the questionnaire. The ques-
tionnaire underwent advanced pilot testing by consulting experts on the test items. They provided
insightful feedback that helped to improve the questionnaire’s content. The purpose of this process was
to guarantee the authenticity of the information. A pilot test was conducted after revisions to the ques-
tionnaire based on experts’ input.
The data collected was analyzed using smart PLS version 4.0. The study employed the PLS-SEM for
the analysis because it is successful with small sample numbers and makes no presumptions regarding
the data being analyzed (Sarstedt et al., 2019). Also, the PLS-SEM offers greater statistical validity than
CB-SEM because it is well-known for its skill while estimating parameters.

5.2. Population and sampling

We used firms Ghana as the study population. Ghana, which is located in the Western part of Africa, was
selected for the study due to the stable socio-political regime, hence, promoting smooth running of busi-
nesses (Sare et al., 2023). To enable the authors select a sample size, purposive sampling approach was used
to identify 457 mining (including quarry firms) and manufacturing firms in Ghana that have at least 50
employees. These mining and manufacturing firms were chosen because their processes are known to
release carbon dioxide, create waste, and need the use of natural resources like minerals and forests (Wiredu
et al., 2023). Firms in the service sector and small businesses were excluded from this study since their busi-
ness activities do not directly influence environmental challenges. The managing director for each of the
identified 421 firms constituted the respondents for the study. Out of the 421 identified respondents,
twenty-six of the selected firms declined to partake in the study, whereas, twelve responses were considered
as incomplete, hence, were excluded from the study. Therefore, the final sample used for the study was 383
respondents. Table 1 provides summary of the population and sample size used for the study.

5.3. Operational definition of study constructs

In this investigation, sustainability disclosure serves as the dependent variable. Shareholder, government,
and customer pressures are the independent constructs. Green technological innovation is the mediating
variable.

5.3.1. Dependent construct

Sustainability disclosure is the act of disclosing environmental-related information to the public (Lulu,
2021). The goal of sustainability disclosure is to provide stakeholders with accurate and transparent infor-
mation about firm’s sustainability-related initiatives and advancements. Sustainability information disclo-
sure may come in various formats such as reports, statements, and statistics.
10 N. ALESSA ET AL.

Table 1. Summary of population and sample size.

Categories Identified Firms Declined Incomplete Final Sample
Manufacturing firms 304 18 7 279
Mining Firms (including quarry) 117 8 5 104
Total 421 26 12 383

5.3.2. Independent constructs

5.3.2.1. Shareholder pressure. Shareholder pressure is the power used by people or organizations that
own stock in a firm to persuade the firm to implement more environmentally friendly procedures (Tian
& Tian, 2021). A shareholder’s strategy might include voting on resolutions pertaining to ESG issues,
conversing with management, or pulling out investments from firms that fall short of their sustainability
standards.

5.3.2.2. Government pressure. Government pressure is the measures the national and local governments
use to encourage sustainability and control corporate conduct (Rudyanto & Veronica Siregar, 2018). This
might include passing legislation and establishing rules for labor laws, CSR, and environmental protection.
Governments may also push firms to adopt more environmentally friendly practices by offering financial
rewards or penalties.

5.3.2.3. Consumer pressure. Consumer pressure arises from the wants and preferences of people who buy
products and services (Lestari et al., 2021). Consumers are becoming more concerned about the ecological
and social consequences of purchasing things. They may buy from firms committed to sustainability or
participate in activism or boycotts to change corporate behavior.

5.3.3. Mediating construct

5.3.1 Green technological innovation (GTI) entails creating and implementing new technologies and pro-
cesses that improve environmental sustainability (Chu et al., 2019). These technologies attempt to save
resources, decrease pollution, and contribute to a more sustainable and environmentally friendly society.
A process and product innovation are examples of green technological innovation

5.4. Measurement of study constructs

The authors employed a validity survey instrument adapted from previous studies to assess the study
constructs. In order to guarantee validity and reliability, questionnaire indicators should be modified from
existing studies. To measure sustainability disclosure, we utilized a measurement developed by Truant
et al. (2017; Chege & Wang, 2020). This scale incorporates indicators related to Global Reporting Initiative
(GRI), comprising various aspect of ESG practices. To measure shareholder pressure, we employed mea-
surement developed by Rudyanto and Veronica Siregar (2018), which includes items such as shareholder
activism, shareholder engagement meetings. This scale has demonstrated reliability and validity. The
measurement of government pressure was adapted from the study of (Mooneeapen et al., 2022; Zhang
& Zhu, 2019). The scale consists of items such as regulatory compliance, legislative initiatives and policy
changes. We assessed customer pressure using a scale adapted from (Zhang & Zhu, 2019), which com-
prises items such as customer feedback and complaints, customer surveys on ESG issues and
customer-requested ESG reporting. To measure green technological innovation, we utilized the scale
from (Wang et al., 2022; Mukhtar et al., 2023), consisting of items such as investment in green research
and development. This scale has been validated in prior studies within the context of technological
innovation.
A total of four indicators were used to assess sustainability disclosure, stakeholder and customer pres-
sure while three items are used to measure government pressure and green technological innovation.
To measure the study constructs, an interval scale is employed. The study constructs that were
regarded as dimensions were measured using a Likert scale. The questionnaire statements were created
once the indicators have been identified. A Likert scale was used to evaluate the attitudes, opinions, and
perceptions of management with stakeholders’ pressure about sustainability disclosure. From strongly
 Cogent Business & Management 11

disagree to strongly agree, a Likert-type instrument offers a range. Table 2 presents the summary of the
study constructs. The detailed constructs is provided in Appendix A.

6. Empirical results and discussion

6.1. Measurement model
We first assessed the study’s results by verifying the convergent validity, discriminant validity, and inter-
nal consistency dependability of the assessment of the outer model. This was done before making a call
on whether or not both convergent and discriminant assumptions hold (Sarstedt et al., 2021).

6.1.1. Indicator reliability

When assessing reflective measurement models, indicators are considered reliable when their loadings
are more than 0.708, which implies that greater than 50% of the indicator’s variance can be explained
by the latent variables. According to Hair Jr et al. (2021), indicators with loadings below 0.40 be routinely
deleted from the measurement model. Figure 1 depicts that all the loading values of the indicators were
over the minimum threshold, indicating that the indicators offered a meaningful assessment of the latent
variables or the items used in the research are dependable.

6.1.2. Internal consistency reliability

According to Hair et al. (2014), the composite reliability numbers need to be greater than 0.60 to reliably
evaluate internal consistency. The external factors loading analysis suggests that the indicator’s reliability
has to be greater than 0.60. The results of the construct reliability are presented in Table 3.
The composite dependability values of the results, displayed in Table 3, range from outstanding (0.869)
to good (0.929). Rho_A is a dependableness metric that has gained popularity as an alternative to com-
posite reliability. Rho_A should ideally be around about 0.70. All the constructs have Rho_A value above
0.70, as shown in Table 3. The investigation complies with the internal consistency criteria because the
Cronbach’s alpha scores and composite reliability scores for each variable were greater than the advised
value of 0.7. Hence, the data is verified and reliable.

6.1.3. Convergent validity

The examining of the typically extracted variance is the first step toward establishing convergent validity
(AVE) (Hair et al., 2014). To test for convergent validity, statisticians employ the AVE. AVE is a measure of
convergent validity, underscoring the proportion of variance in the observed variables that is captured
by the underlying construct. According to Hair et al. (2014), an AVE of 0.50 or greater is preferable.
During convergent validity testing, the AVE results are then analyzed in depth. The AVE threshold value
is 0.50. The minimum AVE for the constructs was 0.703. Therefore, convergent validity is satisfied. Table 4
displays the computed AVE values.

6.1.4. Discriminant validity

Discriminant validity illustrates the fact that relationships between constructs that logically should not
exist occur. We evaluated the discriminant validity using the standards established by Fornell and Larcker
(1981) in Table 5. The square root of AVE values was shown to have the strongest correlation with the
latent variable across all indicators and constructs in this study. The largest numbers in the columns as

Table 2. Summary of study constructs and the number of indicators.

Constructs Number of indicators Construct type Measurement
Sustainability disclosure (SD) 4 Dependent Likert scale
Shareholder pressure (SP) 4 Independent Likert scale
Government pressure (GP)′ 3 Independent Likert scale
Customer pressure (CP) 4 Independent Likert scale
Green technological innovation (GTI) 3 Mediating Likert scale
12 N. ALESSA ET AL.

Figure 1. Indicator reliability loading.

Table 3. Construct reliability.

Constructs Cronbach’s alpha Composite reliability (rho_a) Composite reliability (rho_c)
Consumer pressure 0.904 0.906 0.933
Government pressure 0.908 0.914 0.942
Green technological innovation 0.856 0.866 0.913
Shareholder pressure 0.874 0.880 0.914
Sustainability disclosure 0.857 0.860 0.904

Table 4. Convergent validity.

Constructs AVE
Consumer pressure 0.778
Government pressure 0.845
Green technological innovation 0.777
Shareholder pressure 0.728
Sustainability disclosure 0.703

Table 5. Discriminant validity (Fornell and larker criterion).

Constructs 1 2 3 4 5
Consumer pressure 0.882
Government pressure 0.825 0.919
Green technological innovation 0.857 0.758 0.881
Shareholder pressure 0.847 0.852 0.817 0.853
Sustainability disclosure 0.881 0.818 0.838 0.817 0.839

well as the rows are shown in bold numerals, which are also visible. Each set of factor coefficients was
less than the square root of the AVE, which shows that discriminant reliability is not an issue (Hair et al.,
2010). In a nutshell, the factors that were looked at have a strong ability to separate. Based on the
results, we can say that this situation satisfies the requirements of discriminant validity. Table 5 presents
the results of the discriminant validity.

6.2. Structural model

The coefficient of determination (R2), variance inflation factor and path coefficient are examined to show
the fitness of the structural model.
 Cogent Business & Management 13

6.2.1. Multicollinearity
Examining the variance inflation factor values for each of the several measurements allowed us to gauge
the degree of multicollinearity. From the results in Table 6, there was no multicollinearity in the model
since the collinearity VIF values for all independent variables were less than 3.3.

6.2.2. Path significance

We performed a bootstrapping operation in Smart-PLS to determine the importance of the model using
a substantial value of 5000 subsamples and a 0.1 two-tailed distribution. The bootstrapping method is
applied to obtain T-statistics for studying both direct and indirect impacts (Hair et al., 2019). The SEM
technique’s outcomes, which provide the pathways, beta values (coefficients), t-statistics, and p-values,
make it more appropriate for both complicated and straightforward models (Hair et al., 2010). Some of
the hypotheses are confirmed by the data in Table 7, while others are refuted.
According to Table 7 results about the direct relationship between the study’s constructs, pressure
from customers has a significant direct influence on sustainability disclosure. This finding supports the
authors hypothesis. In addition, the study results revealed a positive and significant relationship between
consumer pressure and green technological innovation. This affirmed hypothesis H4. The result indicates
that customers pressure plays a key role in influencing firm green technological innovation adoption and
sustainability disclosure practices. Moreover, government pressure has a positive and substantial influ-
ence on sustainability disclosure, which was in line with the study’s assumption. This implies that a per-
centage change in pressure from the government will increase sustainability disclosure by 0.417. However,
government pressure has an insignificant effect on GTI. This outcome denied the authors hypothesis that
government pressure has a significant influence on GTI. This implies that pressure from the government
had an insignificant effect on firms’ adoption and implementation of GTI initiatives.
Additionally, shareholder pressure revealed a significant and favorable impact on the disclosure of sus-
tainability information by mining and manufacturing firms in Ghana. Therefore, it is scientifically proven
that shareholder pressure has a positive and considerable influence on ESG, indicating that 1% increase
in the coefficient of shareholder pressure will boost sustainability disclosure of firms by 0.340. Also, share-
holder pressure revealed a significant and substantial effect on green technological innovation, validating
H5. This means that a percentage increase in pressure from shareholder will lead to an increased in GTI
initiatives by 0.318. Similarly, according to Table 4 results, GTI significantly influence sustainability disclo-
sure, showing that a 1% increase in GTI will escalate firm sustainability disclosure by 0.114.
In Table 7, the mediation results demonstrate that the GTI had a substantial mediating influence
between shareholder pressures and sustainability disclosure, as well as, between customer pressure and

Table 6. Multicollinearity statistics (inner VIF).

Constructs CP GP GTI SP SD
CP 3.102 3.039
GP 4.227 2.227
GTI 4.237
SP 2.768 3.196
SD

Table 7. Direct relationship and indirect relationship.

Direct relationship Path significance T statistics P values 95% CI UL 95% CI LL Decisions
CP -> GTI 0.582 13.909 0.000*** 0.510 0.649 Accepted
CP -> SD 0.151 5.237 0.000*** 0.103 0.196 Accepted
GP -> GTI 0.007 0.184 0.854 −0.050 0.068 Denied
GP -> SD 0.417 17.164 0.000*** 0.378 0.458 Accepted
GTI -> SD 0.114 4.627 0.000*** 0.073 0.155 accepted
SP -> GTI 0.318 7.739 0.000*** 0.250 0.386 Accepted
SP -> SD 0.340 15.182 0.000*** 0.304 0.377 Accepted
Mediating analysis
GP -> GTI -> SD 0.001 0.179 0.858*** −0.006 0.008 No mediation
SP -> GTI -> SD 0.036 4.027 0.000*** 0.023 0.053 Full mediation
CP -> GTI-> SD 0.067 4.267 0.000*** 0.043 0.093 Full mediation
Significant at 1%.
14 N. ALESSA ET AL.

sustainability disclosure. This implies that, pressure from shareholders and consumer has a significant
indirect impact on sustainability disclosure through green technological innovation. On the other hand,
GTI showed a negligible mediation effect is observed between government pressure and sustainability
disclosure denying the hypothesis 8. This clearly indicates that green technological innovation does not
influence the relationship between government pressure and sustainability disclosure.

6.2.3. Goodness of fit

After evaluating the importance of the path coefficient in the structural model, we determined the mod-
el’s goodness of fit (GOF). The R-square (R2) determination coefficient is the most widely applied criterion.
According to Sahoo. (2019), R2 quantifies the explanatory power of the model. In general, R2 values of
0.25, 0.50, and 0.75 are regarded as weak, moderate, and significant, respectively (Sahoo, 2019). According
to Hair (2020), R2 values fall into three categories: average (0.333), weak (0.190), and approximately large
(0.670). Table 8 displays the constructs’ predictive power, as well as how effectively the explanatory vari-
ables of the model forecast results. For green technology innovation and sustainability disclosure, the
results revealed a predictive capacity (R2) of 0.764 and 0.924, respectively.

6.2.4. Effect sizes

Effect sizes quantify the degree to which an independent construct influences the dependent construct.
An independent construct, or exogenous latent variable, has a little, medium or high effect on the
dependent construct, with values falling between 0.020 and 0.150, 0.150 and 0.350 and 0.350 and above
0.350. Therefore, from Table 9 the independent constructs have varied effect on green technological
innovation and sustainability disclosure.

6.3. Discussion
Sustainability disclosure practices can be influenced by stakeholder pressure. Successful ecological sus-
tainability is contingent upon interactions with businesses and constituents. As per the stakeholder the-
ory, a firm’s relationship with its stakeholders is enhanced by its steadfast commitment to ecological
initiatives or activities (Wiredu et al., 2023).
Some previous studies have uncovered a positive and beneficial relationship between stakeholder
pressure, green technology, and sustainability disclosure (Thomas et al., 2022; Lulu, 2021). For instance,
Chithambo et al. (2022) suggested that institutional shareholders affect a firm’s ESG performance, which
is essential for long-term corporate sustainability. Given the purpose of the research, the study hypoth-
esize that shareholder pressures have positive and substantial effects on sustainability disclosure. The
analysis of the results confirmed that shareholder pressure is positively associated with sustainability
disclosure. This implies that shareholders with voting rights can influence the executive decision to
include ESG-related information in annual reports in order to enhance the firm’s image and economic
viability over the long term. Our results were consistent with the assumption. Hence, the first hypothesis
was accepted. Our result supports the stakeholder theory, which states that business entities have an

Table 8. R-square.
Constructs R-square R-square adjusted
Green technological innovation 0.764 0.763
Sustainability disclosure 0.924 0.924

Table 9. Effect size.

Constructs CP GP GTI SP SD
CP 0.350 0.054
GP 0.030 0.543
GTI 0.041
SP 0.090 0.294
SD
 Cogent Business & Management 15

obligation to all other groups or stakeholders who have a vested interest in the business apart from
shareholders, and to fulfill this objective, firms engaged and disclosed information related to ESG to
meet the requirement and interest of other stakeholders. Moreover, our results is consistent with the
results by Rui and Lu (2021), who concluded that shareholder pressure significantly affects the environ-
mental performance of manufacturing businesses listed on the Indonesia Stock Exchange.
The government has the power to impose rules that must be adhered to by all parties, including
pressure to disclose sustainability information. Thus, government regulations may exert pressure on the
business to publish sustainability reports. According to the institutional theory, firms may provide an
increasing amount of ESG data to comply with legal requirements, avoid fines from environmental
authorities, and legitimize their business practices (Posadas et al., 2023). Therefore, the study assumed
that government pressure has a positive and significant influence on sustainability disclosure. This
hypothesis is supported by the significance of the path coefficient results. Hence, the second hypothesis
is accepted. The study’s results are consistent with (Eryadi et al., 2021) assertion that government pres-
sure significantly improves the publication of sustainability reports.
As stated in the hypothesis, customer pressure is positively related with sustainability disclosure. This
is evidence to the legitimacy theory, which posits that firms report more on environmental, social, and
governance issues to support and justify their continued existence (Orazalin et al., 2023). Businesses that
want to compete in the global market may enhance their ESG reporting to draw in and keep environ-
mentally conscious customers. Due to the fact that businesses with a high degree of consumer proximity
tend to be more distinctive and are most likely to influence other businesses to fulfill their social and
environmental obligations. These results indicate that consumers are extremely concerned with the qual-
ity of the products and services they purchase. In addition to purchasing affordable goods or services
from a firm, consumers also pay attention to the product’s environmental friendliness, labor conditions,
and other sustainability performance factors. Hence, the assumption is accepted.
With regards to the relationship between stakeholders’ pressure and green technological innovation.
We assumed that shareholder pressure has positive a significant impact on green technological innova-
tion. The results of this study validated this hypothesis. This result aligns with an empirical study by
Singh et al. (2022), which shows that stakeholders put pressure on green innovation capability.
Shareholders may encourage managers to implement and practice green innovation since customers are
interested and ready to pay more for environmentally friendly products. This will boost the economic
performance of the firm as well as shareholders’ return on investment.
Also, the author hypothesized that government pressure has a positive and significant relationship
with green innovation. This claim is not supported by the study results. This may be as results of no
governmental rules and regulations binding firms to adopt green technological innovation in their pro-
duction process.
A positive association between consumer pressure and green technological innovation is assumed as
part of the study’s hypothesis. Path significance results supported the hypothesis. Given that customers
may alter their consumption patterns from everyday goods to green technological or environmentally
friendly products, they may do so. Many consumers are reticent to pay an extra cost or switch to a dif-
ferent product solely because a product is eco-friendly. In response, businesses may enhance green tech-
nological innovation to keep and attract additional consumers. An empirical piece of evidence indicates
that customer pressure encourages firms to implement green innovations and has been shown to
increase competition due to products that are distinct from competitors and enhance product image
and firm credibility (Chu et al., 2019).
Further, varying results are achieved concerning the mediating roles of green technological innova-
tion. The study results revealed that green technological innovation does not mediate the relationships
between government pressure and sustainability disclosure. This finding disapproved H7, which assumed
that green technological innovation moderates the relationship between shareholder pressure and sus-
tainability. However, the study results revealed that green technological innovation mediates the relation-
ship between shareholder pressure, customer pressure and sustainability disclosure, validating H8 and
H9. This conclusion is in line with the empirical results of a study by Xu et al. (2022), which found that
the relationship between CSR and ecological performance is positively and significantly mediated by
green technology innovation.
16 N. ALESSA ET AL.

7. Summary and conclusion

We examined the extent to which firms in Ghana disclose information regarding sustainability. Specifically,
we investigated the influence of stakeholders’ pressure on sustainability disclosure, with green techno-
logical innovation serving as a mediator. 383 out of 421 identified respondents from various mining and
manufacturing firms in Ghana submitted valid responses to the survey questionnaire.
The results of the article demonstrated that stakeholder pressure (shareholder pressure, government
pressure, and consumer pressure) a have a significant influence on firms’ ESG disclosure. Moreover, the
results demonstrate that a firm’s GTI mediates the connection between stakeholder pressure in terms of
shareholder pressure and consumer pressure. Nonetheless, the study revealed that GTI played a negligi-
ble mediating role between government and ESG disclosure.
It is therefore recommended that product development managers implement new technologies and
techniques, as well as to consider eco-friendly initiatives. Incorporating GTI into the product design and
manufacturing process enables firms to not only fulfill their client’s needs but also reduce their environ-
mental impacts, like the production of carbon dioxide and solid debris. Also, to enhance firms’ reputa-
tions, businesses should take the necessary steps, such as using eco-friendly flora, preparing annual
integrated reports, and disclosing sustainability information, to resolve society and other parties’ issues.
The study made the following contributions: First, by including green technology innovation as a
mediating variable, the study advances our knowledge of the mechanisms influencing ESG disclosure
through stakeholder pressure. Secondly, this study adds a contextual dimension to institutional theory
by looking at Ghana. It recognizes that emerging markets’ regulatory and normative environments may
differ significantly from developed economies. This helps us understand how institutional factors interact
with stakeholder pressures to shape ESG disclosure practices in a diverse global setting. Thirdly, the study
provides a holistic view by looking at process and product innovation as parts of green technology
innovation. This recognition acknowledge that environmentally friendly practices cover more than just
the finished product; they also include the production processes. This broad view helps us understand
the eco-friendly efforts in businesses more complexly.

7.1. Policy implication

The study’s results have numerous implications for decision-makers, executives at businesses, regulatory
agencies, and other stakeholders. First, through stakeholder pressure and GTI initiatives, the study offers
a vital understanding of the steps that must be taken to improve sustainability disclosure. Since ecolog-
ical issues are of greater worry for ecological pressure organizations, the community, as well as authori-
ties for regulation as a whole, the study recommends that businesses evaluate the demands or interests
of stakeholders when making business decisions. The prioritization of stakeholder demands and interests
by businesses not only facilitates their attainment of a common competitive advantage and compliance
but also facilitates their achievement of improved sustainability disclosure performance.
Moreover, regarding strategic decision-making, Ghanaian businesses may use the study results to guide
strategic decision-making processes, recognizing the influence of stakeholder pressure on ESG disclosure
practices. Policymakers may utilize the results to develop ESG transparency interventions for various firms.
The inclusion of stakeholder expectations into strategic decision-making processes has the potential to
improve stakeholder interactions, hence contributing to a firm commitment to climate protection.

7.2. Limitation and future research

This research has its drawbacks. First, data were gathered from managing directors of selected mining
and manufacturing firms in Ghana, with no other countries or regions considered. Therefore, the research
cannot be generalized regionally. Hence, future research should consider multiple nations. Secondly, the
pressure exerted by stakeholders is measured using only three dimensions (shareholder, government,
and customer pressures). Other forms of stakeholders’ pressure such as employee and creditor pressure
were not considered. Future research should consider adding other forms of stakeholder pressure that
possibly influence sustainability disclosure.
 Cogent Business & Management 17

Third, given that the study did not include any moderating variables, it limits the ability to investigate
the potential nuanced effects and interactions. Several factors, including organizational culture, regula-
tory environment, and industry characteristics, have the potential to impact the link between stakeholder
pressure and ESG disclosure which were not considered in this study. Hence, future studies should con-
sider these variables.
Fourth, there were no control variables in the study, which means there is a possibility of bias caused
by missing factors. There may be factors that need to be considered that influence both stakeholder
pressure and ESG disclosure, which confounds the link that has been seen. It is recommended that
future studies consider including relevant control factors to make the results more reliable.

Author contributions
Noha Alessa: conceptualization & design; methodology; analysis & interpretation; drafting of the paper; revising it
critically for intellectual content. John Yaw Akparep: conceptualization & design; methodology; analysis & interpre-
tation; drafting of the paper; and revising it critically for intellectual content. Inusah Sulemana: conceptualization &
design; analysis & interpretation; methodology; drafting of the paper; and revising it critically for intellectual content.
Andrew Osei Agyemang: conceptualization & design; methodology; analysis & interpretation; drafting of the paper
and revising it critically for intellectual content. All authors agree to be accountable for all aspects of the work.

Disclosure statement
No potential conflict of interest was reported by the author(s).

Data availability statement

The study relied on primary data that were collected through the administration of questionnaire from management
of manufacturing businesses in Ghana.

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Appendix A
Please indicate the extent to which you agree or disagree with each statement by selecting the appropriate re-
sponse on the scale provided.
Antecedents
1 = strongly disagree; 2 = Disagree; 3 = Neutral; 4 = Agree; 5 = Strongly Agree

Code Shareholder pressure 1 2 3 4 5

SP1 Shareholder pressure significantly influences our firm’s commitment to
sustainability reporting
SP2 Our sustainability disclosure aligns with the priorities and concerns
expressed by our shareholders.
SP3 Shareholder pressure is a primary driver for our firm to enhance its
sustainability reporting practices.
SP4 Sustainability disclosure practices are modified in response to the
expectations and demands of our shareholders.
Code Government pressure
GP1 Government pressure plays a significant role in motivating our firm to
disclose its sustainability initiatives.
GP2 Our firm actively responds to government mandates and regulations by
enhancing sustainability disclosure.
GP3 The influence of government pressure is evident in the comprehensive
nature of our sustainability disclosure practices.
Code Customer pressure
CP1 Customer expectations have a substantial impact on our firm’s
commitment to sustainability disclosure.
CP2 Our sustainability disclosures align with the values and priorities of our
customer base.
CP3 Customer pressure significantly influences the transparency and depth of
our sustainability disclosure practices.
CP4 Feedback from customers regarding sustainability practices leads to
continuous improvement in our disclosure strategies.
Code Green technological innovation
GTI1 The integration of green technological innovation is crucial in satisfying
shareholder expectations and promoting transparency in sustainability
disclosure.
GTI2 Green technological innovation is a key enabler in responding to
government pressure for enhanced sustainability disclosure in our
firm.
GTI3 The adoption of green technological innovation is instrumental in
meeting and exceeding customer expectations regarding
sustainability disclosure.
Code Sustainability disclosure
SD1 Our firm is committed to maintaining a high level of transparency in
sustainability disclosure due to stakeholder expectations.
SD2 Our firm actively seeks ways to enhance sustainability disclosure in
response to changing expectations and pressures from stakeholders.
SD3 The influence of stakeholder pressure has a measurable impact on the
quality and quantity of sustainability information disclosed by our
firm.
SD4 Stakeholder pressure significantly influences the strategic decisions made
regarding sustainability disclosure in our firm.