Assessing the Decision-Usefulness of ESG Reporting and Financial Transparency: Evidence from the U.S. Capital Markets and the Sustainability Capital Matrix Model (SCMM)
This study examines the decision usefulness of accounting information in U.S. capital markets by
integrating traditional financial information with corporate and sustainability-related disclosures.
It focuses on the value relevance of Earnings per Share (EPS) and Book Value per Share (BVPS),
market reactions to financial and sustainability disclosures, sectoral differences in disclosure responses,
sustainability-related capital allocation, and the influence of firm size and leverage on market valuation.
A quantitative research design was employed, using panel data on 100 publicly listed U.S. non-financial
firms from 2015 to 2025. The study applies the Ohlson valuation model, event study methodology, and
the Sustainability Capital Matrix Model (SCMM).
The empirical results indicate that EPS and BVPS are positively and significantly associated with stock
prices, supporting the value relevance of traditional accounting information. The event-study analysis
reports a statistically significant Average Abnormal Return (AAR) of 1.80%, indicating that corporate
disclosure events contain information relevant to capital-market participants. Sector-level results show
differences in observed market reactions, although the proposed moderating effect of sector requires
formal interaction regression for conclusive validation. The SCMM demonstrates that sustainability-
related capital allocation gaps can be quantified by comparing actual allocation with benchmark
requirements. Furthermore, firm size is positively and significantly associated with market valuation,
whereas leverage is negatively associated but not statistically significant.
The results suggest that accounting information remains important for capital-market decision-making,
while decision usefulness increasingly extends to corporate disclosure and sustainability information.
The study emphasizes that such information’s usefulness depends on its relevance, transparency,
credibility, comparability, and economic substance. The research contributes to the accounting literature
by integrating value relevance analysis, market reaction analysis, and sustainability capital-allocation
assessment within a single framework.
10.33425/2690-8077.1252
Published: 10 Nov, 2026