Green, blue or black, but washing–What company characteristics determine greenwashing?

Abstract

The purpose of this paper is to study what are the characteristics that make firms less or more prone to greenwashing. We collect data from sustainability disclosures of the S&P top 100 companies, to investigate the determinants of greenwashing. We use content analysis to measure the level of reporting of the companies. We define the “greenwashing” variable as the difference between what the company says it does in terms of commitment to sustainability, and what the company actually does as evaluated by external parties (Bloomberg ESG scores). Our results show that companies in environmentally sensitive industries greenwash less than their counterparts in other industries, as well as companies following the GRI guidelines. Companies that issue a sustainability report and assure it greenwash less than those that do not do it. Contrary to our intuition, companies in industries with close proximity and high visibility greenwash more than their counterparts. A limitation of the paper is the inclusion in the sample of data from one country. Our findings have implications for policy-makers, particularly in Europe, where some European states have already regulated on green issues reporting and lately on blue issues. It might be interesting to consider both the industry effect and the relevance of reporting mechanisms when developing regulation and policies in order to improve the quality of sustainability reporting. We contribute to literature by proposing a new quantitative measure to assess greenwashing practices, to better understand the effect of industry and reporting mechanisms on greenwashing.

The analytic hierarchy process as an innovative way to enable stakeholder engagement for sustainability reporting in the food industry

“…CSR is a multi-level concept that can also be used interchangeably with sustainability (Strand et al, 2015). Research has shown that companies that operate in environmentally sensitive sectors participate in less greenwashing and that lower greenwashing is associated with higher-quality sustainability reporting (Ruiz-Blanco et al, 2022). Accordingly, there is an assumed link between sustainability reporting and CSR practices.…”

Corporate Social Responsibility and Marketing: A Bibliometric and Visualization Analysis of the Literature between the Years 1994 and 2020

“…Panel surveys can assess, over time, the marketing results of organizations that exhibit these CSR washing practices. Although it is not within the scope of bibliometric analysis, significant growth in the number of publications on this subject was noticed in the year 2021, indicating a real increase in interest in investigating this topic (e.g., [116][117][118][119][120]).…”

Determinants and consequences of corporate social responsibility decoupling—Status quo and limitations of recent empirical quantitative research

“…Second, to decrease those problems, other researchers recognized the difference between CSR reporting, based on manual content analyses, and CSR performance, based on external CSR databases ( Bloomberg , e.g., Ruiz‐Blanco et al, 2022; Morgan Stanley Capital International , Tashman et al, 2019), as CSR decoupling. Next to manual content analyses, automatized textual analyses to measure tone management in CSR reporting, for example, based on python and wordlists, are used.…”