<p>This study contributes to the knowledge economy literature by examining how environmental, social, and governance (ESG) disclosure and corporate stakeholder orientation (CSO) function as complementary knowledge-based governance assets that interactively shape a firm’s cost of debt. In increasingly regulated financial environments, we posit that ESG disclosure is not a uniform signal but is interpreted by creditors through the lens of a firm’s relational governance, specifically its stakeholder orientation. Drawing on a dynamic panel of 864 publicly listed firms from eight European countries (2008–2022), we employ a two-step system Generalised Method of Moments (GMM) estimator to analyse the ESG–cost of debt relationship and explicitly test the moderating role of a multidimensional CSO index. The empirical results reveal a nuanced relationship between these variables. We find that higher levels of ESG disclosure are, on average, associated with a higher cost of debt, suggesting that creditors internalise the regulatory and long-term risk exposures signalled by enhanced transparency. However, this effect is critically moderated by the corporate stakeholder orientation. For firms with strong CSO, the relationship between ESG disclosure and the cost of debt becomes negative. Stakeholder orientation transforms ESG disclosure from a risk premium into a credibility and trust signal that lowers borrowing costs. These findings underscore that the financial impact of ESG disclosure is contingent on a firm’s underlying governance ethos. By reconceptualising ESG and CSO as intertwined components of a firm’s informational and relational capital, this study advances the understanding of how sustainability governance is priced in the credit markets. We conclude that in a knowledge-based economy, stakeholder orientation is the critical mechanism that unlocks the debt financing benefits of ESG transparency.</p>