Perceived Greenwashing: The Interactive Effects of Green Advertising and Corporate Environmental Performance on Consumer Reactions

Abstract

The current study investigates the effects of green advertising and a corporation's environmental performance on brand attitudes and purchase intentions. A 3X3 (firm's environmental performance and its advertising efforts as independent variables) experiment using n=302 subjects was conducted. Results indicate that the negative effect of a firm's low performance on brand attitudes becomes stronger in the presence of green advertising compared to general corporate advertising and no advertising. Further, when the firm's environmental performance is high, both green and general corporate advertising result in more unfavorable brand attitudes than no advertising. The study's counter-intuitive findings are explained by attribution theory.

Won’t Get Fooled Again: The Effects of Internal and External CSR ECO-Labeling

“…With the growing awareness of the importance of a sustainable environment, and of the (financial) benefits which eco-labeled products might bring, the amount of those products and the variation of eco-labels increased enormously (Gallastegui 2002;Nyilasy et al 2014). This profusion of CSR labels, whether justified or not, makes it difficult to distinguish which label is certified by a third party (external CSR label), and hence provides a more objective assessment of a company's CSR efforts, and which label is uncertified (internal CSR claim; Nyilasy et al 2014;Parguel et al 2011).…”

“…This profusion of CSR labels, whether justified or not, makes it difficult to distinguish which label is certified by a third party (external CSR label), and hence provides a more objective assessment of a company's CSR efforts, and which label is uncertified (internal CSR claim; Nyilasy et al 2014;Parguel et al 2011). Therefore, it is also of interest to investigate how consumers respond to the combination of such an external multilevel environmental performance rating and internal CSR efforts controlled by the company.…”

“…According to Delmas and Burbano (2011), this encompasses two simultaneous behaviors: poor environmental performance and positive communication about these poor environmental performances. Thus, an internal CSR claim becomes misleading when firms do not live up to their promises (i.e., corporate greenwashing), which adversely impacts the CSR efforts and the corporation's reputation (Nyilasy et al 2014). Looking back at the two simultaneous behaviors in which greenwashing companies engage: poor environmental performance and positive communication about these poor environmental performances, it becomes clear that when internal CSR claims are combined with a negative external CSR label, it is likely to instill perceptions of greenwashing, which has a negative impact on CSR efforts and causes skepticism (Delmas and Burbano 2011).…”

“…The greenwashing literature indeed suggests an interaction between environmental performance and green advertising (Delmas and Burbano 2011;TerraChoice 2010;Nyilasy et al 2014;De Vries et al 2013). A study conducted by Nyilasy et al (2014) demonstrated that when an internal CSR claim (talk) and actual corporate environmental performance (deeds) are inconsistent, a perceived greenwashing effect occurs.…”

“…By means of investments in green advertising and CSR, firms want to be perceived as environmentally friendly and socially involved in order to build up more positive brand attitudes and purchase intentions (Nyilasy et al 2014). Indeed, CSR initiatives based on one of the three dimensions-social, ethical, or commercial-have been proven to affect consumer responses.…”