Corporate claims about environmental performance have increased rapidly in recent years, as has the incidence of greenwash, that is, communication that misleads people into forming overly positive beliefs about an organization’s environmental practices or products. References to greenwash in the literature have grown rapidly since the term was introduced more than 2 decades ago, with a sharp increase in articles since 2011. We review and synthesize this fragmented and multidisciplinary literature, showing that greenwash is a broad umbrella term that encompasses a variety of specific forms of misleading environmental communication. More research is needed that identifies and catalogues the varieties of greenwash, theorizes and models their mechanisms drawing on existing social science research, and measures their impacts on corporate performance and social welfare.

Greenwashing is more virulent than ever. A profusion of environmental, social, and governance and net zero commitments are becoming fraught with questionable and misleading claims. At the same time, we are no closer to solving the pressing environmental and social issues of our time. In this review, we seek to examine this shift and summarize changes in greenwash research into three key phases: (a) 1.0 Static Communication; (b) 2.0 Dynamic Management; and (c) 3.0 Narratives about the Future. We analyze current key areas of developing literature and point to numerous open questions for future research. Next, we go beyond much of the published work to examine emerging tactics and lay out a forward-looking agenda for future research. We also propose a model of Corporate Miscommunication, integrating various streams in greenwash research. In doing so, we seek to lay a pathway for greenwashing researchers to finally find that elusive “end” to greenwashing.

This paper presents the first empirical test of the financial impacts of institutional investor activism towards climate change. Specifically, we study the conditions under which share prices are increased for the Financial Times (FT) Global 500 companies due to participation in the Carbon Disclosure Project (CDP), a consortium of institutional investors with $57 trillion in assets. We find no systematic evidence that participation, in and of itself, increased shareholder value. However, by making use of Russia’s ratification of the Kyoto Protocol, which caused the Protocol to go into effect, we find that companies’ CDP participation increased shareholder value when the likelihood of climate change regulation rose. We estimate the total increase in shareholder value from CDP participation at $8.6 billion, about 86% of the size of the carbon market in 2005. Our findings suggest that institutional investor activism towards climate change can increase shareholder value when the external business environment becomes more climate conscious.