The Interaction Between Greenwashing and Chinese ESG Investors: Analyzing from the Perspectives of Credibility and Investment Decision-making

Environmental, Social, and Governance (ESG) investing involves considering environmental, social, and governance factors to make socially responsible investment decisions that align with ethical and sustainable values. The widespread adoption of ESG has stimulated academic research in this field, primarily focusing on North America and Europe. However, in the current development of ESG investment in China, "greenwashing" has attracted widespread attention and awaits effective resolution. Greenwashing is the deceptive practice of conveying a false impression or exaggerating a company's commitment to environmental and social responsibility to appear more environmentally friendly than it is. Therefore, this study employs a literature analysis approach to study the interaction between greenwashing and Chinese ESG investors. The primary finding indicates that diverse forms of greenwashing by companies can influence investors' decisions and ESG ratings. This study outlines three key resolution strategies: centralized environmental monitoring policies, companies streamlining management and financial costs, and institutional investors conducting on-site inspections.