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The Harm of Symbolic Actions and Green-Washing: Corporate Actions and Communications on Environmental Performance and Their Financial Implications


  • Kent Walker


  • Fang Wan



We examine over 100 top performing Canadian firms in visibly polluting industries as we seek to answer four research questions: What specific environmental issues are firms addressing? How do these issues differ between industries? Are both symbolic and substantive actions financially beneficial? Does green-washing, measured as the difference between symbolic and substantive action, and/or green-highlighting, measured as the combined effect of symbolic and substantive actions, pay? We find that substantive actions of environmental issues (green walk) neither harm nor benefit firms financially, but symbolic actions (green talk) are negatively related to financial performance. We also find that green-washing (discrepancy between green talk and green walk) has a negative effect on financial performance and green-highlighting (concentrated efforts of the talk and walk) has no effect on financial performance. In this article, we provide explanations of our findings and put forth future research directions. Copyright Springer Science+Business Media B.V. 2012

Suggested Citation

  • Kent Walker & Fang Wan, 2012. "The Harm of Symbolic Actions and Green-Washing: Corporate Actions and Communications on Environmental Performance and Their Financial Implications," Journal of Business Ethics, Springer, vol. 109(2), pages 227-242, August.
  • Handle: RePEc:kap:jbuset:v:109:y:2012:i:2:p:227-242
    DOI: 10.1007/s10551-011-1122-4

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    References listed on IDEAS

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    1. Siano, Alfonso & Vollero, Agostino & Conte, Francesca & Amabile, Sara, 2017. "“More than words”: Expanding the taxonomy of greenwashing after the Volkswagen scandal," Journal of Business Research, Elsevier, vol. 71(C), pages 27-37.
    2. Marian Siminica & Liviu Craciun & Adina Dinu, 2015. "The Impact of Corporate Sustainability Strategies on the Financial Performance of Romanian Companies in the Context of Green Marketing," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 17(40), pages 994-994, August.
    3. repec:gam:jsusta:v:9:y:2017:i:10:p:1778-:d:113764 is not listed on IDEAS
    4. Leila Elgaaïed-Gambier, 2016. "Who Buys Overpackaged Grocery Products and Why? Understanding Consumers’ Reactions to Overpackaging in the Food Sector," Journal of Business Ethics, Springer, vol. 135(4), pages 683-698, June.
    5. Amparo Baviera-Puig & Tomás Gómez-Navarro & Mónica García-Melón & Gabriel García-Martínez, 2015. "Assessing the Communication Quality of CSR Reports. A Case Study on Four Spanish Food Companies," Sustainability, MDPI, Open Access Journal, vol. 7(8), pages 1-22, August.
    6. repec:gam:jsusta:v:8:y:2015:i:1:p:23:d:61414 is not listed on IDEAS
    7. Hjort, Ingrid, 2016. "Potential Climate Risks in Financial Markets: A Literature Overview," Memorandum 01/2016, Oslo University, Department of Economics.
    8. Kunapatarawong, Rasi & Martínez-Ros, Ester, 2016. "Towards green growth: How does green innovation affect employment?," Research Policy, Elsevier, vol. 45(6), pages 1218-1232.
    9. Zelong Wei & Hao Shen & Kevin Zheng Zhou & Julie Juan Li, 2017. "How Does Environmental Corporate Social Responsibility Matter in a Dysfunctional Institutional Environment? Evidence from China," Journal of Business Ethics, Springer, vol. 140(2), pages 209-223, January.
    10. repec:eee:joreco:v:32:y:2016:i:c:p:117-130 is not listed on IDEAS
    11. Baviera-Puig, Amparo & García-Martínez, Gabriel & Gómez-Navarro, Tomás, 2014. "Propuesta metodológica mediante ANP para la evaluación de las memorias de sostenibilidad del sector agroalimentario español," Economia Agraria y Recursos Naturales, Spanish Association of Agricultural Economists, vol. 14(1).
    12. Contreras-Pacheco, Orlando E. & Claasen, Cyrlene, 2017. "Fuzzy reporting as a way for a company to greenwash: perspectives from the Colombian reality," MPRA Paper 85472, University Library of Munich, Germany.
    13. Da-Chang Pai & Chi-Shiun Lai & Chih-Jen Chiu & Chin-Fang Yang, 2015. "Corporate Social Responsibility and Brand Advocacy in Business-to-Business Market: The Mediated Moderating Effect of Attribution," Journal of Business Ethics, Springer, vol. 126(4), pages 685-696, February.
    14. Newton, Joshua D. & Tsarenko, Yelena & Ferraro, Carla & Sands, Sean, 2015. "Environmental concern and environmental purchase intentions: The mediating role of learning strategy," Journal of Business Research, Elsevier, vol. 68(9), pages 1974-1981.
    15. Ionel Jianu & Carmen Ţurlea & Ionela Guşatu, 2015. "The Reporting and Sustainable Business Marketing," Sustainability, MDPI, Open Access Journal, vol. 8(1), pages 1-12, December.
    16. Kent Walker & Na Ni & Weidong Huo, 2014. "Is the Red Dragon Green? An Examination of the Antecedents and Consequences of Environmental Proactivity in China," Journal of Business Ethics, Springer, vol. 125(1), pages 27-43, November.
    17. Aoife Brophy Haney, 2015. "Managerial interpretation and innovation in the context of climate change," Cambridge Working Papers in Economics 1524, Faculty of Economics, University of Cambridge.
    18. repec:kap:jbuset:v:143:y:2017:i:1:d:10.1007_s10551-015-2758-2 is not listed on IDEAS
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    20. Nathalie Meißner & Ulrike Grote, 2017. "Motives, opportunities, and risks for private sector investment in protected areas with international importance: evidence from German companies," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 19(1), pages 199-219, February.
    21. Carmen Valentina RÃDULESCU & Ildiko IOAN & Marian NÃSTASE, 2016. "Premises of the Green Business Strategies," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 17(2), pages 108-113, May.
    22. Banu Dincer, 2016. "The Role of Sustainability Disclosures for the Capital Market Participants: Evidence from Turkey," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 6(4), pages 134-141, October.
    23. Costa-Campi, M.T. & García-Quevedo, J. & Martínez-Ros, E., 2017. "What are the determinants of investment in environmental R&D?," Energy Policy, Elsevier, vol. 104(C), pages 455-465.
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