Dissertation
The Impact of Corporate Greenwashing on Mutual Fund Investment Decisions
Doctor of Philosophy (PhD), Washington State University
2026
Abstract
This study examines the impact of corporate greenwashing on the investment behavior of sustainability-focused mutual funds. Greenwashing is defined as the discrepancy between a firm’s overly positive
environmental disclosures and its actual environmental performance. I find that greenwashing firms tend
to disclose less specific and quantitative information while using more complex language. Additionally,
sustainability-focused mutual funds are less likely to hold greenwashing firms and more likely to divest
when greenwashing is publicly revealed. Divested capital is reallocated to firms with better environmental
performance. The negative association between greenwashing and mutual fund investment is most
pronounced among firms with strong financial performance, high consumer visibility, and greater
regulatory exposure. Overall, this study provides evidence that sustainability-focused mutual funds play an
important role in promoting corporate sustainability by disciplining firms for misleading environmental
claims.
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Details
- Title
- The Impact of Corporate Greenwashing on Mutual Fund Investment Decisions
- Creators
- Zhonghua Zhang
- Contributors
- Chase Potter (Advisor)Beau Barnes (Committee Member)Kathleen Harris (Committee Member)
- Awarding Institution
- Washington State University
- Academic Unit
- Carson College of Business
- Theses and Dissertations
- Doctor of Philosophy (PhD), Washington State University
- Number of pages
- 77
- Identifiers
- 99901394297001842
- Language
- English
- Resource Type
- Dissertation