Paper: arXiv 2312.14515

Authors: Mathieu Gomes, Sylvain Marsat, Jonathan Peillex, Guillaume Pijourlet

Abstract

We analyze the influence of religious social norms on corporate greenwashing behavior. Specifically, we focus on a specific form of greenwashing: selective disclosure. Using a large sample of US firms between 2005 and 2019, we show that firms located in counties where religious adherence is high are less likely to engage in greenwashing. We also find that a stronger religious adherence within the county in which a company is located reduces the magnitude of greenwashing, when observed. We further analyze the mechanism underlying this relationship and show that religious adherence impacts greenwashing behaviors through the channel of risk aversion. A comprehensive set of robustness tests aimed at addressing potential endogeneity concerns confirms that religion is a relevant driver of corporate greenwashing behavior.

Complexity vs Empirical Score

  • Math Complexity: 2.5/10
  • Empirical Rigor: 7.5/10
  • Quadrant: Street Traders — practical and empirical, lighter on theory

Why this score: The paper relies heavily on applied econometric panel data models rather than complex mathematical derivations, placing it firmly in the empirical domain. It offers novel insights into how socio-cultural factors like religiosity affect corporate ESG behaviors and selective disclosure, backed by rigorous endogeneity and robustness checks.

Research Flowchart

  flowchart TD
    A[Research Goal: Does county-level religiosity influence corporate greenwashing?] --> B[Data Inputs: US Firms 2005-2019 & County Religious Adherence Rates]
    B --> C[Methodology: Analyze Selective Disclosure & Address Endogeneity]
    C --> D[Mechanism Analysis: Evaluate Risk Aversion Channel]
    D --> E[Finding 1: High religiosity reduces likelihood & magnitude of greenwashing]
    D --> F[Finding 2: Risk aversion drives the negative relationship]