Greenwashing in ESG: Identifying and Addressing False Claims of Sustainability

Purpose: The study explores the growing issue of greenwashing in Environmental, Social, and Governance (ESG) reporting, identifying common deceptive practices and their impact on stakeholders. Methodology: A mixed-method approach was used, including content analysis of sustainability reports and interviews with stakeholders across industries. This approach helped uncover the prevalence and nature of greenwashing tactics and evaluate their implications. Findings: Greenwashing remains a significant barrier to genuine corporate sustainability. Common tactics include selective disclosure, vague claims, and irrelevant assertions, which undermine ESG reporting credibility. The absence of stringent regulatory frameworks and third-party verification exacerbates these practices, leading to eroded stakeholder trust, distorted investment decisions, and hindered consumer awareness. Findings also highlight the sectoral variance in greenwashing tactics and emphasize the need for stricter regulatory measures. Unique Contribution to Theory, Policy, and Practice: The research contributes to the ESG field by identifying actionable solutions for curbing greenwashing, including regulatory reforms, mandatory third-party audits, and the adoption of technologies such as blockchain for ESG verification. The study underscores the importance of transparent ESG reporting in fostering trust, enabling informed decisions, and advancing global sustainability goals.