How greenwashing influences formal and informal institutional benefits in China

Abstract

Enterprises are likely to adopt the greenwashing approach to obtain institutional benefits under an imperfect institutional background. Using panel data on Chinese enterprises from 2010 to 2015, we examine the possibility of enterprises obtaining formal and informal institutional benefits through greenwashing in China. Moreover, from the perspective of government enterprise relationships and social enterprise relationships, we show that government enterprise relationships positively regulate the relationship between greenwashing and formal institutional benefits, and public attention will weaken the positive relationship between greenwashing and informal institutional benefits. These results provide important implications for the relationship between greenwashing and institutional benefits and further highlight the value of government guidance and supervision of enterprises' greenwashing.