Words in Action, Governance in Effect: Will Green Finance Reform and Innovation Policies Lead to “Greenwashing” in Enterprises?

Corporate “greenwash” constrains high-quality economic development in China, and its identification and governance constitute a critical step in building a green market and advancing ecological civilization. However, existing studies have primarily focused on the green governance effects of green finance policies, while paying limited attention to whether such policies may induce corporate “greenwash”. Using panel data on A-share listed firms in China from 2011 to 2023, this study exploits the Green Finance Reform and Innovation Pilot Zones as a quasi-natural experiment and employs a Double Machine Learning model to identify the impact of green finance reform policies on corporate “greenwash” and its underlying mechanisms. The results show that the pilot policy induces corporate “greenwash”, but this effect exhibits significant temporal characteristics and does not persist in the long run. Heterogeneity analysis further indicates that the aggravating effect is more pronounced among non-state-owned enterprises, non-heavily polluting firms, and large-scale firms. Mechanism analysis reveals that the pilot policy promotes corporate “greenwash” by intensifying external competitive pressure and internal performance pressure, while such behavior can be mitigated through optimizing firms’ internal strategic decision-making and external capital structure. Based on these findings, this study proposes policy recommendations in three aspects, namely establishing a dynamic policy adjustment mechanism, improving the competitive environment, and strengthening corporate governance, thereby providing a policy basis for mitigating corporate “greenwash”.