Greenwashing and Environmental Communication: Effects on Stakeholders’ Perceptions

Torelli R, Balluchi F, Lazzini A. Greenwashing and environmental communication: Effects on stakeholders' perceptions. Business Strategy and the Environment. 2020; 29: 407–421

27 Pages Posted: 25 Oct 2019 Last revised: 12 Feb 2020

See all articles by Riccardo Torelli

Riccardo Torelli

Università Cattolica del Sacro Cuore, Department of Economic and Social Sciences

Federica Balluchi

Parma University, Department of Economics and Management

Arianna Lazzini

Università degli studi di Modena e Reggio Emilia (UNIMORE)

Date Written: August 14, 2019

Abstract

Since the first Earth Day in the 1970s, corporate environmental performance has increased dramatically, and cases of green-washing have increased sharply. The term green-wash refers to a variety of different misleading communications that aim to form overly positive beliefs among stakeholders about a company's environmental practices. The growing number of corporate social responsibility claims, whether founded or not, creates difficulties for stakeholders in distinguishing between truly positive business performance and companies that only appear to embrace a model of sustainable development. In this context, through the lens of legitimacy and signalling theory, we intend to understand and assess the different influences that various types of misleading communications about environmental issues have on stakeholders' perceptions of corporate environmental responsibility and green-washing. Stakeholder responses to an environmental scandal will also be assessed. The hypotheses tested through a four-for-two design experiment reveal that different levels of green-washing have a significantly different influence on stakeholders' perceptions of corporate environmental responsibility and stakeholders' reactions to environmental scandals.

Keywords: green-washing, environmental communication, signaling theory, legitimacy theory, experiment, corporate social responsibility

JEL Classification: M10, M14, M41

Suggested Citation

Torelli, Riccardo and Balluchi, Federica and Lazzini, Arianna, Greenwashing and Environmental Communication: Effects on Stakeholders’ Perceptions (August 14, 2019). Torelli R, Balluchi F, Lazzini A. Greenwashing and environmental communication: Effects on stakeholders' perceptions. Business Strategy and the Environment. 2020; 29: 407–421, Available at SSRN: https://ssrn.com/abstract=3470659 or http://dx.doi.org/10.2139/ssrn.3470659

Riccardo Torelli (Contact Author)

Università Cattolica del Sacro Cuore, Department of Economic and Social Sciences ( email )

Via Emilia Parmense 84
Piacenza, Piacenza 29122
Italy

Federica Balluchi

Parma University, Department of Economics and Management ( email )

Via J.F. Kennedy, 6
Parma, 43125
Italy

Arianna Lazzini

Università degli studi di Modena e Reggio Emilia (UNIMORE) ( email )

Viale A. Allegri 9
Modena, Modena 42121
Italy

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