IDEAS home Printed from https://ideas.repec.org/p/cpr/ceprdp/21803.html

Objective vs. Perceived Corporate Greenness: Do Individuals Understand Corporate Sustainability Information?

Author

Listed:
  • Fabisik, Kornelia
  • Rink, Sebastian

Abstract

We investigate how individuals interpret corporate sustainability disclosures in a pre-registered survey experiment. We provide novel evidence that participants can meaningfully distinguish greener from browner firms, yet their assessments exhibit a central tendency bias. Interestingly, this bias is asymmetric: respondents overestimate the greenness of browner firms while underestimating the greenness of greener firms more strongly. The same pattern persists among finance professionals and sustainability experts, suggesting that expertise alone does not eliminate interpretation errors. Consequently, firms’ incentives to invest in emissions reductions may be attenuated. We further identify disclosure design features that enhance individuals’ ability to differentiate firms’ emissions performance.

Suggested Citation

  • Fabisik, Kornelia & Rink, Sebastian, 2026. "Objective vs. Perceived Corporate Greenness: Do Individuals Understand Corporate Sustainability Information?," CEPR Discussion Papers 21803, Centre for Economic Policy Research.
    • Handle: RePEc:cpr:ceprdp:21803
    as

    Download full text from publisher

    File URL: https://cepr.org/publications/DP21803
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    ;

    JEL classification:

    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

    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:cpr:ceprdp:21803. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: CEPR (email available below). General contact details of provider: https://cepr.org/ .

    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.