Sustainability and Accountability: Assessing Their Impact on Capital Structure

Abstract

Sustainability and accountability have emerged as two strategic pillars in modern corporate governance. This study aims to assess the influence of sustainability and accountability on a firm’s capital structure by employing a structured literature review approach based on various peer-reviewed academic publications from last five years. The findings indicate that the integration of sustainability strategies and accountability practices contributes to enhanced investor confidence, reduced financial risk, and leads to a more efficient and balanced capital structure. Firms that adopt sustainable practices and uphold transparent, accountable reporting are perceived as lower-risk entities, which improves their access to capital at a reduced cost. Moreover, in an increasingly on conscious investment environment, sustainability and accountability are not only ethical imperatives but also financial strategies that align with long-term value creation. This research offers important managerial implications, particularly for financial decision-makers and policymakers, by providing insights into how sustainable governance can be aligned with capital structure decisions to support strategic growth, stakeholder trust, and long-term stability in financing.