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May 9, 2026Accounting Research Journal3 citations

Leading sustainably or deceptively? CEO social capital, corporate green washing and environmental responsiveness

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JKJalal KhanMBMushahid Hussain BaigOGObaid Gulzar

Key Points

  • This study aims to understand the relationship between CEO social capital and corporate greenwashing behaviors, focusing on environmental responsiveness among Chinese firms.
  • Analyzed panel data from Chinese A-share firms between 2014 and 2022.
  • Constructed a composite index of CEO social capital based on political, business, and academic ties.
  • Employed fixed effects regression and various econometric techniques like 2SLS and difference-in-differences.
  • CEO social capital significantly reduces instances of greenwashing.
  • Environmental responsiveness directly decreases greenwashing and enhances the negative impact of CEO social capital on greenwashing.
  • Firms in high-polluting industries increased their greenwashing behavior following the 2018 Environmental Protection Tax Law.

Abstract

Purpose This study aims to explore how CEO social capital (CEOSC) influences corporate greenwashing behavior, with a particular focus on the moderating role of environmental responsiveness in Chinese A-share listed firms. It also aims to examine whether socially embedded chief executive officers (CEOs) are more or less likely to engage in deceptive sustainability disclosures. Design/methodology/approach Using a panel data set of Chinese A-share firms from 2014 to 2022, this study constructs a composite index of CEOSC based on political, business, and academic ties. Fixed effects regression is used as the baseline model. Robustness is confirmed through alternative variable measures and econometric techniques, including two-stage least squares (2SLS), Heckman’s two-stage selection model, two-step generalized method of moments (GMM), and difference-in-differences (DID) analysis. Findings The findings show that CEOSC significantly reduces greenwashing behavior. Furthermore, environmental responsiveness both directly lowers greenwashing and amplifies the negative effect of CEOSC on it. DID results also revealed that firms in high-polluting industries increased their greenwashing after the implementation of China’s Environmental Protection Tax Law in 2018, indicating that this was a case of policy-induced symbolic compliance. Originality/value This study is among the first to integrate social network theory with environmental governance by linking CEOSC to greenwashing. It contributes to the green governance literature by highlighting the contingent role of environmental responsiveness. The findings provide practical insights for firms, regulators, and policymakers.

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Cite This Study

Khan et al. (2026) studied this question.

synapsesocial.com/papers/69fecfafb9154b0b82876a80https://doi.org/10.1108/arj-08-2025-0318
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