Does City Honor Drive Companies to Remove the Mask of Greenwashing? Evidence from the National Civilized City Program in China

Abstract

At present, many enterprises are facing the dilemma of green management and greenwashing behavior is becoming increasingly serious. The honor of a city is an intangible asset that can bring opportunities for city development and enhance the recognition and loyalty of stakeholders within the city. At present, there are few studies on the impact of city reputation on corporate green behavior. This paper collected data on Chinese A-share listed enterprises from 2009 to 2019 and explored the relationship between the two using a double-difference model. The robustness of the hypotheses was verified by using the parallel trend test, placebo test, and PSM-DID. It was finally concluded that city honor inhibits corporate greenwashing behavior through two pathways, strengthening environmental regulation and stimulating corporate social responsibility, and it has a spillover effect between regions. Moreover, this effect is more obvious in regions with a high economic development level and a high degree of marketization, and it also shows a significant role in state-owned enterprises and enterprises with high total assets. This paper provides a theoretical basis for studying the relationship between city honor and corporate greenwashing behavior, and it also acts as a reference for standardizing enterprises’ environmental behavior and improving the quality of environmental information disclosure of enterprises.