The green fog: Environmental rating disagreement and corporate greenwashing

Hu, Xinwen; Hua, Renhai; Liu, Qingfu; Wang, Chuanjie

doi:10.1016/j.pacfin.2023.101952

Cited by 73 publications

(20 citation statements)

References 66 publications

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“…ESG report greenwashing scores. Based on the methods of previous studies (Hu et al, 2023; Yu et al, 2020; Zhang, 2022a), the degree of greenwashing can be measured by comparing the gap between the level of ESG disclosure and the level of ESG performance. The specific calculation method is shown in Formula ():

Greenwashin g_{i} = \frac{D_{i} - \overset{true¯}{D}}{σ_{D}} - \frac{P_{i} - \overset{true¯}{P}}{σ_{P}} .

…”

Section: Methodsmentioning

confidence: 99%

“…The standardized ESG disclosure level and performance evaluation score of the same industry and the year are compared. The difference between the two values reflects the gap between ESG oral publicity and ESG behavior (Hu et al, 2023). The larger the value is, the higher the degree of greenwashing.…”

Section: Methodsmentioning

confidence: 99%

“…Fourth are other factors. Hu et al (2023) found that environmental rating disagreement intensifies the degree of information opacity of enterprises, which directly affects the future greenwashing behavior of enterprises. Especially when a company obtains a low ESG score, the company's management and employees are more inclined to greenwash (Lee & Raschke, 2023).…”

Section: Studies On Esg Report Greenwashingmentioning

confidence: 99%

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Research on the masking effect of vertical interlock on ESG greenwashing in the context of sustainable Enterprise development

Liu

Hao

et al. 2023

Corp Soc Responsibility Env

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Based on impression management and principal‐agent theory, this article considers Chinese A‐share listed companies from 2014 to 2020 to explore whether vertical interlocking promotes the sustainable development of enterprises from the perspective of environmental, social, and governance (ESG) report greenwashing. The results show that vertical interlocking increases ESG report greenwashing and hides negative ESG information; these results remained valid through a series of robustness tests. Mechanism analysis shows that the purpose of ESG report greenwashing by vertically interlocked executives is to hollow out minority shareholders rather than to cover up earnings management to conceal actual ESG information. The vertical interlocking of executives more significantly promotes ESG report greenwashing when the property is state‐owned, has poor internal supervision mechanisms, has a large executive team and has no senior executives with green experience. This study furthers the relevant research on the factors affecting the sustainable development of enterprises and enriches and expands studies of the role of the vertical interlock from the perspective of information concealing, providing a more in‐depth reference for promoting the sustainable development of enterprises.

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Greenwashin g_{i} = \frac{D_{i} - \overset{true¯}{D}}{σ_{D}} - \frac{P_{i} - \overset{true¯}{P}}{σ_{P}} .

…”

Section: Methodsmentioning

confidence: 99%

Section: Methodsmentioning

confidence: 99%

Section: Studies On Esg Report Greenwashingmentioning

confidence: 99%

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Research on the masking effect of vertical interlock on ESG greenwashing in the context of sustainable Enterprise development

Liu

Hao

et al. 2023

Corp Soc Responsibility Env

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“…We also use this test in the submatrices[9] to analyse the presence of greenwashing and SDG-washing. Following Yu et al (2020), Ferrón et al (2022), Sensharma et al (2022), Zhang (2022a, 2022b) and Hu et al (2023), we test for greenwashing by examining the possible differences in ex ante and ex post indicators for each SDG. In contrast, SDG-washing supposes that companies promote some SDGs to the detriment of others.…”

Section: Methodsmentioning

confidence: 99%

Examining greenwashing and SDG-washing: an analysis of corporate engagement with the SDGs

del Río,

González-Álvarez,

López-Arceiz

2023

SAMPJ

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Purpose The purpose of this study is to examine the existence of greenwashing and sustainable development goal (SDG)-washing processes by comparing ex ante (SDG Compass) and ex post (SDG Compliance) indicators and investigating whether the limitations associated with these indicators encourage companies to engage in washing processes. Design/methodology/approach The authors use a sample of 1,154 companies included in the S&P Sustainability Yearbook (formerly the RobecoSAM Yearbook). The authors test for the presence of greenwashing by comparing ex ante and ex post indicators for each SDG, whereas to test for SDG-washing, the authors compare the two ex ante and ex post approaches considering the full set of SDGs. Findings The results show that there is no consistency between the two types of indicators to measure the level of SDG implementation in organisations. This lack of consistency may facilitate both greenwashing and SDG-washing processes, which is due to the design and limitations of these measurement tools. Practical implications Companies may choose those indicators that paint their commitment to the SDGs in the best light, but they may also select indicators based on the SDGs they want to report on. These two options would combine greenwashing and SDG-washing. Social implications The shift towards improved standards and regulations for measuring SDG achievement is the result of several social factors such as investor scrutiny, regulatory reform, consumer awareness and increased corporate accountability. Originality/value Few previous studies have analysed in detail the interaction between greenwashing and SDG-washing. They focus on the use of ex ante or ex post indicators separately, with samples composed of local companies, and without considering the whole set of SDGs.

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“…In an analysis of over 400 voluntary third-party certification statements, Heras-Saizarbitoria et al (2020) found that fewer than half resulted in any discernible environmental improvement. Furthermore, there is huge divergence between voluntary schemes, with often wildly differing criteria and results, resulting in what Hu et al (2023) call 'the green fog'. Ultimately, Partzsch and Kemper (2019) argue that, while some certification schemes have the potential to encourage meaningful change, they ultimately reflect neoliberal forms of governance, bypassing the state and reinforcing power asymmetries between different actors.…”

Section: Greenwashing Geography Power and Politicsmentioning

confidence: 99%

Greenwashing: Appearance, illusion and the future of ‘green’ capitalism

Williams

2024

Geography Compass

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Greenwashing is a well‐understood concept, describing the use of false or misleading claims and symbolism to give an impression of a company or organisation's commitment to environmental protection and sustainability. While many environmental groups use the concept widely to criticise the ‘optics’ strategies of organisations wanting to improve their image while maintaining a business‐as‐usual approach, it has largely been ignored in Geography and related disciplines. This paper argues that we need to take greenwashing seriously. It develops a broad concept of greenwashing, suggesting that the processes of obscuring social and ecological relations via greenwashing are central to the (dis)functioning of contemporary capitalism. A critical theory of greenwashing, therefore, is not simply about challenging ‘bad actors’, but is an essential part of a wider critique of ‘green’ capitalism and Sustainable Development.

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The green fog: Environmental rating disagreement and corporate greenwashing

Cited by 73 publications

References 66 publications

Research on the masking effect of vertical interlock on ESG greenwashing in the context of sustainable Enterprise development

Research on the masking effect of vertical interlock on ESG greenwashing in the context of sustainable Enterprise development

Examining greenwashing and SDG-washing: an analysis of corporate engagement with the SDGs

Greenwashing: Appearance, illusion and the future of ‘green’ capitalism

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