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Corporate Governance Role in Greenwashing and Firm Value Nexus

Author

Listed:
  • Islahuddin Islahuddin

    (Accounting Department, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh 23111, Indonesia)

  • Yossi Diantimala

    (Accounting Department, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh 23111, Indonesia)

  • Zera Ayudiastika

    (Accounting Department, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh 23111, Indonesia)

  • Muhammad Putra Aprullah

    (Accounting Department, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh 23111, Indonesia)

Abstract

This study investigates how greenwashing affects firm value and whether corporate governance can mitigate its negative impact. The analysis is based on 760 companies in the energy, basic materials, and industrial sectors in Indonesia during 2020–2024. Moderated regression analyses using a random effect model were conducted to test the hypotheses. The results show that greenwashing has a significant negative relationship with firm value. As hypothesized, corporate governance weakens this negative effect, indicating it reduces greenwashing’s impact. This study offers novelty by combining the presence of CSR committees and internationally experienced directors as measures of corporate governance to examine their moderating role in the relationship between greenwashing and firm value.

Suggested Citation

  • Islahuddin Islahuddin & Yossi Diantimala & Zera Ayudiastika & Muhammad Putra Aprullah, 2026. "Corporate Governance Role in Greenwashing and Firm Value Nexus," IJFS, MDPI, vol. 14(3), pages 1-26, March.
    • Handle: RePEc:gam:jijfss:v:14:y:2026:i:3:p:60-:d:1876493
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