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Climate Risk, CEO Risk Preference, and Corporate Greenwashing in High-Emission Industry: A Debiased Machine Learning Approach

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  • Shijie Ma

    (School of Business, Macao University of Science and Technology, Macao 999078, China)

  • Jingzhi Hou

    (School of Business, Macao University of Science and Technology, Macao 999078, China)

  • Haoran Niu

    (School of Business, Macao University of Science and Technology, Macao 999078, China)

  • Hsing Hung Chen

    (The Institute for Sustainable Development, Macao University of Science and Technology, Macao 999078, China)

Abstract

The transition to a low-carbon economy is the cornerstone of global sustainability, requiring high-emission enterprises to shift from carbon-intensive production to genuine green innovation. However, this study uncovers a significant structural impediment to this transition: the “defensive greenwashing” response to climate stress. Focusing on listed companies in China’s high-emission industries (2009–2024), we employ a Debiased Machine Learning (DML) framework and Causal Forest analysis to capture the non-linear impacts of multi-dimensional climate risks. Our findings reveal a robust “threshold-trigger” mechanism: once climate pressures—whether physical shocks or policy-induced transition risks—exceed corporate endurance levels, firms aggressively pivot toward strategic “information arbitrage” rather than substantive decarbonization. We identify a profound “capability paradox” in sustainability governance, where firms with higher digital maturity and resource slack leverage their technical prowess to “calibrate” sophisticated narratives, thereby widening the monitoring gap and distorting green asset pricing. Furthermore, CEO risk preference acts as a psychological accelerator, amplifying strategic decoupling, particularly under transition-risk-induced uncertainty. By demonstrating how climate stress inadvertently incentivizes symbolic compliance over sustainable transformation, this research offers critical micro-level insights for policymakers. These findings are vital for refining sustainability oversight and ensuring that capital allocation fosters a resilient, equitable transition toward true ecological and economic decoupling.

Suggested Citation

  • Shijie Ma & Jingzhi Hou & Haoran Niu & Hsing Hung Chen, 2026. "Climate Risk, CEO Risk Preference, and Corporate Greenwashing in High-Emission Industry: A Debiased Machine Learning Approach," Sustainability, MDPI, vol. 18(10), pages 1-29, May.
  • Handle: RePEc:gam:jsusta:v:18:y:2026:i:10:p:5174-:d:1947639
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