Table 1 Variable definitions and... | Emerald Publishing

Table 1

Variable definitions and measurement

Variable	Symbol	Definition and measurement	Unit	Source/Reference
Dependent variables
Return on Assets	ROA	Net income divided by total assets at year-end	Ratio	Dhaliwal et al. (2011)
Return on Equity	ROE	Net income divided by shareholders' equity	Ratio	Velte (2017)
Independent variables
ESG Performance	ESG	Huazheng ESG rating score, rescaled to 0–100	Score (0–100)	Zhou and Nian (2024)
Standardized ESG	ESG_Z	Year-standardized z-score: $(E S G_{i t} - {m e a n}_{t}) / {S D}_{t}$	Z-score	Busch and Friede (2018)
Moderating variables
Abnormal Audit Fees	AbnFees	Residuals from the audit fee determinants model (Simunic, 1980)	Value	Simunic (1980)
Audit Fee Scale	LnAudit	Natural logarithm of total audit fees paid	Log(RMB)	Hay et al. (2006)
Big 4 Auditor	Big4	Dummy = 1 if auditor is PwC, Deloitte, EY, or KPMG; 0 otherwise	Dummy	Francis et al. (2014)
Unqualified Opinion	Opinion	Dummy = 1 if opinion is standard unqualified; 0 if modified	Dummy	DeFond and Zhang (2014)
Control variables
Firm Size	Size	Natural logarithm of total assets at year-end	Log(RMB)	DeFond et al. (2011)
Leverage	Lev	Total liabilities divided by total assets	Ratio	Dhaliwal et al. (2011)
Market-to-Book	TobinQ	(Market value of equity + Book value of debt)/Total assets	Ratio	Kaplan and Zingales (1997)
Cash Flow Ratio	CBNP	Operating cash flow divided by net profit	Ratio	Kim et al. (2012)
Board Size	Board	Natural logarithm of the number of board directors	Log(Number)	Dalton et al. (1999)
State Ownership	SOE	Dummy = 1 if the ultimate controller is the state; 0 otherwise	Dummy	Liu et al. (2014)

Variable	Symbol	Definition and measurement	Unit	Source/Reference
Dependent variables
Return on Assets	ROA	Net income divided by total assets at year-end	Ratio	Dhaliwal et al. (2011)
Return on Equity	ROE	Net income divided by shareholders' equity	Ratio	Velte (2017)
Independent variables
ESG Performance	ESG	Huazheng ESG rating score, rescaled to 0–100	Score (0–100)	Zhou and Nian (2024)
Standardized ESG	ESG_Z	Year-standardized z-score: $(E S G_{i t} - {m e a n}_{t}) / {S D}_{t}$	Z-score	Busch and Friede (2018)
Moderating variables
Abnormal Audit Fees	AbnFees	Residuals from the audit fee determinants model (Simunic, 1980)	Value	Simunic (1980)
Audit Fee Scale	LnAudit	Natural logarithm of total audit fees paid	Log(RMB)	Hay et al. (2006)
Big 4 Auditor	Big4	Dummy = 1 if auditor is PwC, Deloitte, EY, or KPMG; 0 otherwise	Dummy	Francis et al. (2014)
Unqualified Opinion	Opinion	Dummy = 1 if opinion is standard unqualified; 0 if modified	Dummy	DeFond and Zhang (2014)
Control variables
Firm Size	Size	Natural logarithm of total assets at year-end	Log(RMB)	DeFond et al. (2011)
Leverage	Lev	Total liabilities divided by total assets	Ratio	Dhaliwal et al. (2011)
Market-to-Book	TobinQ	(Market value of equity + Book value of debt)/Total assets	Ratio	Kaplan and Zingales (1997)
Cash Flow Ratio	CBNP	Operating cash flow divided by net profit	Ratio	Kim et al. (2012)
Board Size	Board	Natural logarithm of the number of board directors	Log(Number)	Dalton et al. (1999)
State Ownership	SOE	Dummy = 1 if the ultimate controller is the state; 0 otherwise	Dummy	Liu et al. (2014)

Note(s): All continuous variables are winsorized at the 1% and 99% levels