The Agency of Greenwashing

38 Pages Posted: 10 Jul 2020

See all articles by Marco Ghitti

Marco Ghitti

SKEMA Business School - Université Côte d’Azur

Gianfranco Gianfrate

EDHEC Business School

Lorenza Palma

affiliation not provided to SSRN

Date Written: June 1, 2020

Abstract

As climate change increasingly challenges business models, the disclosure of firm environmental performance casts growing attention by corporate stakeholders. This creates wider opportunities and incentives for greenwash behaviours. We propose a novel measure of greenwashing and investigate its determinants and consequences for US firms. We find that companies with larger boards are less prone to greenwashing. Board independence is positively associated with greenwash behaviours, while the percentage of women in the board has no detectable impact. Finally, we show that greenwashing reduces firm value.

Keywords: ESG, Climate Change, Carbon Footprint, Greenwashing, Agency Theory

JEL Classification: G32, M14, Q56

Suggested Citation

Ghitti, Marco and Gianfrate, Gianfranco and Palma, Lorenza, The Agency of Greenwashing (June 1, 2020). Available at SSRN: https://ssrn.com/abstract=3629608 or http://dx.doi.org/10.2139/ssrn.3629608

Marco Ghitti

SKEMA Business School - Université Côte d’Azur

Esplanade Mona Lisa
- Courbevoie -
Paris La Défense, 92916
France

Gianfranco Gianfrate (Contact Author)

EDHEC Business School ( email )

58 rue du Port
Lille, 59046
France

Lorenza Palma

affiliation not provided to SSRN

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