When the Measure Is Contested: ESG Rating Divergence, Corporate Financial Reporting Behaviour, and the Validity of the Evidence Base—A Systematic Literature Review

ESG rating providers assessing the same firm in the same year reach materially different conclusions. Six reviews since 2024 have synthesised what that divergence does to capital markets; what it does to firms’ own financial reporting and audit behaviour, and to the credibility of research using ESG ratings, has not been reviewed. Following PRISMA 2020, this review identifies studies linking an ESG rating imperfection to a financial reporting, disclosure or audit outcome, pairs bibliometric mapping with a thematic synthesis, and appraises each study for how far its inference survives the choice of provider. Fifty-five studies qualified. Among those whose direction of estimation could be coded, more estimate the effect of reporting on divergence than the reverse, and the disclosure evidence and the audit evidence sit on opposite arms of that distinction, so pooling them as consequences of divergence misdescribes most of them. The apparent conflict between findings that disclosure is associated with more disagreement and findings that it is associated with less can be reconciled once disclosure quantity is separated from disclosure quality. The evidence is almost entirely associational. None of the 46 studies whose design could be assessed attains a low inference risk on the review’s coding, and three do on an independent second coding: a low rating is rare and contested, because the field models divergence carefully and then treats it as exogenous to the reporting with which the same literature finds it to co-vary. A reporting standard for ESG-based accounting research follows.