The impact of corporate greenwashing on debt default risk

Using a sample of Chinese A-share listed firms in Shanghai and Shenzhen from 2015 to 2022, this study finds that corporate greenwashing is positively associated with debt default risk. Heterogeneity analysis reveals that this effect is more pronounced among firms in less developed regions, with low marketization, weak internal controls, non-Big Four audits, low media attention, high financing constraints, and operating in high-pollution industries. Mechanism analysis indicates that corporate greenwashing reduces information disclosure quality, thereby exacerbating debt default risk.