The greenwashing effects on corporate reputation and brand hate, through environmental performance and green perceived risk

Abstract

Purpose

When a company practices greenwashing, it violates consumers' expectations by deliberately deceiving them about their environmental practices or the benefits of their products/services. This study investigated the effects of greenwashing on corporate reputation and brand hate. Furthermore, this study explored the mediating effects of perceived environmental performance and green perceived risk.

Design/methodology/approach

A survey design using cross-sectional primary data from 420 Portuguese consumers who identified and recognized brands engaged in greenwashing was employed. The proposed hypotheses were tested using structural equation modeling techniques.

Findings

This study's findings show that consumer perceptions of greenwashing may damage brands. The results show that greenwashing has a negative effect on corporate reputation through perceived environmental performance and green perceived risk. Additionally, greenwashing has a positive direct effect on brand hate and a negative effect on green perceived risk. Therefore, reducing greenwashing practices can improve consumers' perceptions of corporate environmental performance, buffer green perceived risk, and ultimately enhance corporate reputation. This can lead to positive relationships with customers.

Originality/value

Based on signaling and expectancy violation theories, this study develops a new framework highlighting the detrimental effects of greenwashing on brands. The combination of these theories provides the right framework to understand how greenwashing may lead to extreme feelings like brand hate and negative perceptions of corporate reputation, thus advancing the current research that lacks studies on the association between these constructs.

Citation

Santos, C., Coelho, A. and Marques, A. (2024), "The greenwashing effects on corporate reputation and brand hate, through environmental performance and green perceived risk", Asia-Pacific Journal of Business Administration, Vol. 16 No. 3, pp. 655-676. https://doi.org/10.1108/APJBA-05-2022-0216