Silenced? Does social-media real-name registration policy facilitate firm misconduct? Evidence from greenwashing in China

Abstract Removing anonymity in social media may stimulate firm misconduct as it reduces social media’s monitoring effects. This paper employs China’s 2015 social media real-name registration policy as a quasi-natural experiment that requires internet users to register their real ID with the government. Results indicate that the policy caused a robust and economically meaningful increase in corporate greenwashing which is a classical misconduct. Results are robust with various robustness checks. Further analysis demonstrates that removing anonymity attenuates social media’s monitoring role in corporate greenwashing by mitigating three channels: reputation cost, market pressure from investors and regulation pressure that social media exerts on firms. Theoretically, our findings identify user anonymity as a key institutional condition enabling social media to function as an informal governance mechanism. The results also highlight a regulatory trade-off: identity-verification rules may curb online harm but can inadvertently weaken external oversight of firm misconduct.