IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v80y2025ics1544612325006038.html

From greenwashing to genuine action: Impact of a CEO's green experience

Author

Listed:
  • Lin, Xian
  • Shen, Weitao
  • Song, Linjia
  • Yang, Xin

Abstract

This study investigates the impact of a CEO's green experience on a firm's greenwashing behavior. Using manually collected data from the sample of Chinese public firms, we find that firms led by CEOs with green experience are less likely to engage in greenwashing. Additionally, these CEOs help their firms obtain additional green subsidies and attract more green investors. Cross-sectional results indicate that firms with weaker corporate governance, less rigorous environmental regulations, and larger earnings expectation gaps show a pronounced reduction in greenwashing. These findings suggest that a CEO's green experience drives the firms to adopt genuine environmentally responsible practices.

Suggested Citation

  • Lin, Xian & Shen, Weitao & Song, Linjia & Yang, Xin, 2025. "From greenwashing to genuine action: Impact of a CEO's green experience," Finance Research Letters, Elsevier, vol. 80(C).
    • Handle: RePEc:eee:finlet:v:80:y:2025:i:c:s1544612325006038
    DOI: 10.1016/j.frl.2025.107345
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1544612325006038
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2025.107345?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Wu, Yang Andrew & Ng, Artie W. & Yu, Zichao & Huang, Jie & Meng, Ke & Dong, Z.Y., 2021. "A review of evolutionary policy incentives for sustainable development of electric vehicles in China: Strategic implications," Energy Policy, Elsevier, vol. 148(PB).
    2. Azar, José & Duro, Miguel & Kadach, Igor & Ormazabal, Gaizka, 2021. "The Big Three and corporate carbon emissions around the world," Journal of Financial Economics, Elsevier, vol. 142(2), pages 674-696.
    3. C. Edward Fee & Charles J. Hadlock & Joshua R. Pierce, 2013. "Managers with and without Style: Evidence Using Exogenous Variation," The Review of Financial Studies, Society for Financial Studies, vol. 26(3), pages 567-601.
    4. Yuan Yuan & Gaoliang Tian & Louise Yi Lu & Yangxin Yu, 2019. "CEO Ability and Corporate Social Responsibility," Journal of Business Ethics, Springer, vol. 157(2), pages 391-411, June.
    5. Xin Li & Fei Guo & Jiaqi Wang, 2024. "A path towards enterprise environmental performance improvement: How does CEO green experience matter?," Business Strategy and the Environment, Wiley Blackwell, vol. 33(2), pages 820-838, February.
    6. Bonsall, Samuel B. & Green, Jeremiah & Muller, Karl A., 2020. "Market uncertainty and the importance of media coverage at earnings announcements," Journal of Accounting and Economics, Elsevier, vol. 69(1).
    7. Jeong-Bon Kim & Chong Wang & Feng Wu, 2023. "The real effects of risk disclosures: evidence from climate change reporting in 10-Ks," Review of Accounting Studies, Springer, vol. 28(4), pages 2271-2318, December.
    8. Xiulu Huang & Chuxiong Tang & Yichao Liu & Pengfei Ge, 2025. "Greening or greenwashing? Corporate green bonds and stock pricing efficiency in China," Sustainability Accounting, Management and Policy Journal, Emerald Group Publishing Limited, vol. 16(3), pages 874-913, January.
    9. Tu, Zhengge & Hu, Tianyang & Shen, Renjun, 2019. "Evaluating public participation impact on environmental protection and ecological efficiency in China: Evidence from PITI disclosure," China Economic Review, Elsevier, vol. 55(C), pages 111-123.
    10. Shuai Wu & Wei Tang & Qiang Fu & Yu Xu, 2024. "The “educational capital” of corporate boards and initial public offering pricing: Evidence from the US initial public offerings," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 45(4), pages 1756-1772, June.
    11. Zhang, Dongyang, 2022. "Green financial system regulation shock and greenwashing behaviors: Evidence from Chinese firms," Energy Economics, Elsevier, vol. 111(C).
    12. Panayiotis C. Andreou & Constantinos Antoniou & Joanne Horton & Christodoulos Louca, 2016. "Corporate Governance and Firm†specific Stock Price Crashes," European Financial Management, European Financial Management Association, vol. 22(5), pages 916-956, November.
    13. Canio Forliano & Enrico Battisti & Paola Bernardi & Tomáš Kliestik, 2025. "Mapping the greenwashing research landscape: a theoretical and field analysis," Review of Managerial Science, Springer, vol. 19(11), pages 3407-3456, November.
    14. Huang, Ruilei & Wei, Jiuchang, 2023. "Does CEOs’ green experience affect environmental corporate social responsibility? Evidence from China," Economic Analysis and Policy, Elsevier, vol. 79(C), pages 205-231.
    15. Mingjun Deng & Hao Tang & Wenbing Luo, 2024. "Can the green experience of CEO improve ESG performance in heavy polluting companies? Evidence from China," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 45(4), pages 2373-2392, June.
    16. Jake Thomas & Wentao Yao & Frank Zhang & Wei Zhu, 2022. "Meet, beat, and pollute," Review of Accounting Studies, Springer, vol. 27(3), pages 1038-1078, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gan, Yufei, 2025. "When green claims turn brown: The Impact of corporate greenwashing on biodiversity risk in China," The Quarterly Review of Economics and Finance, Elsevier, vol. 104(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Li Meiyi & Gan Yufei, 2025. "More Philanthropy, More Consistency? Examining the Impact of Corporate Charitable Donations on ESG Rating Uncertainty," Economics - The Open-Access, Open-Assessment Journal, De Gruyter, vol. 19(1), pages 1-21.
    2. Sun, Haibo & Han, Fangyuan & Liu, Zhonglu, 2024. "Does executive environmental protection experience reduce enterprise energy consumption intensity?," Economic Analysis and Policy, Elsevier, vol. 83(C), pages 652-666.
    3. Zhang, Ping & Ma, Binbin & Chi, Chuenyu, 2025. "Institutional investors and ESG performance: Evidence from China," Economic Analysis and Policy, Elsevier, vol. 86(C), pages 1159-1181.
    4. Dan Zhang & Bingxiang Li & Qiang Fu & Wei Tang & Taqdees Fatima, 2025. "Impact of CEOs' Environmental Experience on Corporate Green Innovation," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 32(3), pages 3290-3312, May.
    5. Zhang, Dongyang, 2023. "Does green finance really inhibit extreme hypocritical ESG risk? A greenwashing perspective exploration," Energy Economics, Elsevier, vol. 121(C).
    6. Fan, Zhangmei & Chen, Ying & Mo, Yifan, 2024. "Management myopia and corporate ESG performance," International Review of Financial Analysis, Elsevier, vol. 92(C).
    7. Hu, Zinan & Borjigin, Sumuya, 2025. "Climate information disclosure quality and systemic risk in the U.S. banking industry," Journal of Financial Stability, Elsevier, vol. 79(C).
    8. Shang, Chenguang, 2021. "Dare to play with fire? Managerial ability and the use of short-term debt," Journal of Corporate Finance, Elsevier, vol. 70(C).
    9. Fan, Hanlu & Zhao, Keyi, 2025. "Uncovering the intensity of climate risk and opportunity: Awareness and effectiveness," The British Accounting Review, Elsevier, vol. 57(2).
    10. Peng, Shengnan & Liu, Chan & Wang, Ze & Ye, Zihan & Sun, Xialing & Tan, Zhanglu, 2024. "The impact of the carbon reduction policy effectiveness on energy companies' ESG performance," International Review of Financial Analysis, Elsevier, vol. 96(PB).
    11. Hui Hou & Yuanyuan Wang & Minglang Zhang, 2024. "Impact of environmental information disclosure on green finance development: empirical evidence from China," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(8), pages 20279-20309, August.
    12. Battisti, Enrico & Bo, Shaocong & Giakoumelou, Anastasia, 2025. "Climate risk disclosure and greenwashing: Evidence from Chinese A-share listed companies," International Review of Economics & Finance, Elsevier, vol. 103(C).
    13. Zhang, Guanglong, 2023. "Regulatory-driven corporate greenwashing: Evidence from “low-carbon city” pilot policy in China," Pacific-Basin Finance Journal, Elsevier, vol. 78(C).
    14. Qiao, Penghua & Zhao, Yuying & Fung, Anna & Fung, Hung-Gay, 2025. "How digital leadership guides ESG sustainability," Research in International Business and Finance, Elsevier, vol. 73(PB).
    15. Muchenje, Linda Tinofirei, 2025. "Stock liquidity and corporate climate performance: evidence from China," Journal of Financial Stability, Elsevier, vol. 77(C).
    16. Lou, Pingyi & Wu, Chenyu, 2024. "Environmental effects of foreign indirect investment: The information channel," Journal of International Money and Finance, Elsevier, vol. 144(C).
    17. Xiong, Jiacai & Yang, Zelin & Wang, Qing Sophie, 2025. "Can non-punitive regulation curb corporate greenwashing?Evidence from a word embedding model," Research in International Business and Finance, Elsevier, vol. 76(C).
    18. Nepal, Rabindra & Deng, Youyi & Dong, Kangyin & Goutte, Stéphane, 2025. "Does executive gender diversity culture inhibit corporate greenwashing behavior? The effect of informal institutions," International Review of Financial Analysis, Elsevier, vol. 97(C).
    19. Ying Ke & Yueqi Wen & Lili Teng, 2025. "Chain Leader Policy and Corporate Environmental Sustainability: A Multi-Level Analysis of Greenwashing Mitigation Mechanisms," Sustainability, MDPI, vol. 17(19), pages 1-45, October.
    20. Jiazhan Gao & Guihong Hua & Baofeng Huo, 2024. "Green finance policies, financing constraints and corporate ESG performance: insights from supply chain management," Operations Management Research, Springer, vol. 17(4), pages 1345-1359, December.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:80:y:2025:i:c:s1544612325006038. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.