Mandatory ESG Information Disclosure Policy:"Safeguarding" the Development of Green Finance-An Evolutionary Game Model Based on Local Governments and Greenwashing Behavior of Heavily Polluting Enterprises

China is in the early stages of green finance development, with some listed companies engaging in greenwashing-misleading practices to appear environmentally friendly. To address this, the paper develops an evolutionary game model involving local governments and heavily polluting enterprises. It explores how mandatory ESG disclosure influences corporate strategy, finding that it can curb greenwashing when local governments enforce higher fines and higher-level governments provide stronger incentives. The case of Shendong Coal Group demonstrates the effectiveness of combining government penalties and incentives. A robust penalty system and high-level government incentives are essential for successful ESG disclosure policies to mitigate corporate greenwashing.