{"id":15179,"date":"2024-03-27T18:07:06","date_gmt":"2024-03-27T17:07:06","guid":{"rendered":"https:\/\/www.covalence.ch\/?p=15179"},"modified":"2024-03-27T18:07:07","modified_gmt":"2024-03-27T17:07:07","slug":"can-investors-curb-greenwashing","status":"publish","type":"post","link":"https:\/\/www.covalence.ch\/index.php\/2024\/03\/27\/can-investors-curb-greenwashing\/","title":{"rendered":"Can Investors Curb Greenwashing?"},"content":{"rendered":"\n<p>At Covalence, we are pleased to have provided data used in this very interesting academic paper by a team of researchers of Institut Polytechnique de Paris.<\/p>\n\n\n\n<p><img loading=\"lazy\" decoding=\"async\" width=\"150\" height=\"98\" class=\"alignright wp-image-15180\" style=\"width: 150px;\" src=\"https:\/\/www.covalence.ch\/wp-content\/uploads\/2024\/03\/crest.png\" alt=\"\">We show how investors with pro-environmental preferences and who penalize revelations of past environmental controversies impact corporate greenwashing practices. Through a dynamic equilibrium model with information asymmetry, we characterize firms&#8217; optimal environmental communication, emissions reduction, and greenwashing policies, and we explain the forces driving them. Notably, under a condition that we explicitly characterize, companies greenwash to inflate their environmental score above their fundamental environmental value, with an effort and impact increasing with investors\u2019 pro-environmental preferences. However, investment decisions that penalize greenwashing, policies increasing transparency, and environment-related technological innovation contribute to mitigating corporate greenwashing. We provide empirical support for our results. (&#8230;)<\/p>\n\n\n\n<p>In practice, we propose a two-step empirical method for analyzing companies\u2019 environmental communication policies and testing their dynamics in cross-section. To do so, we use monthly data from the data provider Covalence, which constructs an environmental reputation score, an environmental controversy score, and an environmental performance score from published news.\u201d <a href=\"https:\/\/papers.ssrn.com\/sol3\/papers.cfm?abstract_id=4644741\" target=\"_blank\" rel=\"noreferrer noopener\">More&#8230;<\/a><\/p>\n\n\n\n<p>Source: <a href=\"https:\/\/papers.ssrn.com\/sol3\/papers.cfm?abstract_id=4644741\" target=\"_blank\" rel=\"noreferrer noopener\">SSRN<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>At Covalence, we are pleased to have provided data used in this very interesting academic paper by a team of researchers of Institut Polytechnique de Paris. We show how investors with pro-environmental preferences and who penalize revelations of past environmental controversies impact corporate greenwashing practices. Through a dynamic equilibrium model with information asymmetry, we characterize&hellip;<\/p>\n","protected":false},"author":665,"featured_media":15180,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"wds_primary_category":2,"wds_primary_post_series":0,"footnotes":""},"categories":[2],"tags":[],"post_series":[],"class_list":["post-15179","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-publications","entry","has-media"],"_links":{"self":[{"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/posts\/15179","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/users\/665"}],"replies":[{"embeddable":true,"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/comments?post=15179"}],"version-history":[{"count":1,"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/posts\/15179\/revisions"}],"predecessor-version":[{"id":15181,"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/posts\/15179\/revisions\/15181"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/media\/15180"}],"wp:attachment":[{"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/media?parent=15179"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/categories?post=15179"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/tags?post=15179"},{"taxonomy":"post_series","embeddable":true,"href":"https:\/\/www.covalence.ch\/index.php\/wp-json\/wp\/v2\/post_series?post=15179"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}