Integrity or deception: executives' environmental backgrounds and corporate greenwashing
Zenglu Song, Jinjing Lu, Chunhua LuoPurpose
Mitigating corporate greenwashing is critical for effective environmental governance. While prior literature emphasizes external institutional pressures, understanding internal human capital drivers of authentic sustainability remains crucial, especially in emerging markets with evolving regulations. Grounded in upper echelons theory, this study investigates how executives' environmental backgrounds (EEB) influence greenwashing, alongside the underlying internal mechanisms and contextual factors.
Design/methodology/approach
Utilizing an unbalanced panel of Chinese A-share listed firms from 2009 to 2023, this study employs multiple regression models to examine the impact of EEB on greenwashing. Mediation and moderation analyses are conducted to explore the underlying mechanisms and boundary conditions.
Findings
EEB significantly reduce greenwashing by alleviating financing constraints, stimulating green innovation, reducing information asymmetry and strengthening green cognition. This inhibitory effect is stronger in heavily polluting firms, non-state-owned enterprises and firms with more female executives. Furthermore, external monitoring – specifically stringent environmental regulations and media scrutiny – amplifies this mitigating effect.
Originality/value
Integrating upper echelons theory with environmental governance research, this study demonstrates that EEB are the crucial human capital factor curbing greenwashing. These findings deepen the understanding of authentic corporate sustainability's behavioral roots, offering practical implications for enhancing environmental accountability and governance.