A Review of the Factors Influencing the Relationship Between Greenwashing and Green Brand Equity: A Research Agenda*

Revisión de los factores que inciden entre el greenwashing y el green brand equity: una agenda investigativa

Sergio Andrés Suárez Gutiérrez sesuarezg@unal.edu.co

Universidad Nacional de Colombia, Colombia

Javier Alirio Sánchez Torres jasanchez@udemedellin.edu.co

Universidad de Medellín, Colombia

Luz Alexandra Montoya Restrepo lamontoyar@unal.edu.co

Universidad Nacional de Colombia, Colombia

Esta obra está bajo una Licencia Creative Commons Atribución-NoComercial-CompartirIgual 4.0 Internacional.

• Greenwashing erodes green trust and green brand image.

• Marketing transparency reduces consumer skepticism.

• Authentic green marketing practices build brand loyalty.

• Clear communication regarding environmental commitments has become a key strategy to mitigate the negative effects of greenwashing.

• El greenwashing erosiona el green trust y el green brand image.

• La transparencia en el marketing verde reduce el escepticismo del consumidor.

• Prácticas auténticas de marketing verde vitalizan la lealtad a la marca.

• La comunicación clara de los compromisos ambientales emerge como estrategias clave para mitigar los efectos negativos del greenwashing.

Due to global concerns about the effects of global warming and environmental challenges, consumers are increasingly aware of the importance of environmental protection (Chen & Chang, 2012; Cao et al., 2017; Shi et al., 2022). This growing awareness has driven companies to adopt more sustainable and socially responsible practices (Zhu et al., 2021; Sujanska & Nadanyiova, 2023). In response, many have decided to incorporate environmental practices and green marketing strategies into their operations (Berrone et al., 2017). In this search for a more ethical and sustainable business model, there has been a particular interest in integrating practices that not only mitigate negative environmental impacts but also contribute to social welfare. This shift towards corporate responsibility has been supported by recent research highlighting the importance of business strategies that embrace both environmental sustainability and social responsibility (Ha et al., 2022).

As environmental awareness among consumers increases and the demand for eco-friendly products grows, it becomes crucial for organizations to adapt their brand management strategies (Khandelwal et al., 2019). This adaptation not only allows them to meet changing consumer preferences but also offers a strategic opportunity to differentiate themselves and capitalize on the value associated with sustainability and environmental respect. In this context, green marketing has emerged as a strategy aimed at fostering sustainable development (Huang et al., 2024; Deshmukh & Tare, 2023), enabling companies to construct a strong brand image (Jiménez Sánchez et al., 2023). This strategy involves various initiatives that include adjustments and improvements in product design, production, packaging, and promotion (Rahman & Haque, 2011).

Despite the potential advantages of green marketing, some organizations resort to misleading practices known as greenwashing (Henao-Rodríguez et al., 2024). These practices, driven by economic interests, seek to capitalize on emerging consumer concerns. Greenwashing involves misleading stakeholders by presenting positive information about environmental performance or benefits while hiding or minimizing negative aspects (Testa et al., 2018). As noted by Tateishi (2017), this practice entails the selective dissemination of information to create a false impression of an organization’s, service’s, or product’s sustainability. Consequently, greenwashing may yield short-term gains for deceitful companies, but in the long term, it damages the entire green market, harming truly sustainable companies (Polonsky et al., 2010).

In a thorough analysis of over a thousand products claiming to be “green” or eco-friendly, all but one exhibited some degree of greenwashing (Terrachoice, 2010). This raises serious concerns about the authenticity and environmental responsibility of products labeled as environmentally friendly. Also, the prevalence of greenwashing among most of the examined products underscores the need for increased transparency and a stricter evaluation of environmental claims, as well as more effective measures to counteract these misleading practices.

According to recent studies into the impacts of greenwashing on stakeholders, these tactics have negative consequences for consumers, brands, and organizations (Santos et al., 2023a). The effect of greenwashing on the perception of green brands, however, has not been sufficiently explored (Akturan, 2018). As environmental concerns escalate and consumer awareness continues to grow, there is considerable interest in investigating brands, products, and companies that adopt environmentally responsible practices across nearly all economic sectors (Sdrolia & Zarotiadis, 2019).

Recently, research in the field has markedly shifted towards the ecological domain. A clear example of this shift is the concept of “brand equity.” The term “green brand equity” was first introduced by Chen in 2010, who defined it as “a set of brand assets and liabilities about green commitments and environmental concerns linked to a brand” (Chen, 2010, p. 310). Green brand equity is a recent trend attracting attention from both researchers and practitioners (Qayyum et al., 2022). This concept includes elements such as the brand’s name and symbol, which can either enhance or diminish consumers’ perception of the quality of a product or service depending on its environmental practices and commitments (Chen, 2010). Furthermore, in their systematic literature review on green brand equity, Górska-Warsewicz et al. (2021) asserted that there has been an increased emphasis on factors such as corporate and social responsibility, green social value, pro-environmental attitude, green perceived risk, green brand perceived value, and green brand credibility.

Studies into greenwashing and green brand equity have been limited (Ha et al., 2022; Ha, 2022). In particular, as Akturan (2018) points out, the impact of greenwashing on green brand equity has mostly gone unnoticed in the literature. Hence, there is a clear need to broaden research endeavors in this area to gain a deeper comprehension of the relationship between greenwashing and green brand equity, as suggested by Pimonenko et al. (2020). Although the terminology associated with these concepts is relatively recent, the relationship between the two has theoretical and practical implications that have not been thoroughly investigated. Despite this, a more recent systematic review of the literature on greenwashing conducted by Santos et al. (2023a) highlighted a promising avenue for research. This avenue is centered on understanding the impacts of greenwashing on brands (green brand equity) and how these impacts are perceived. Such an approach can shed light on important points and contribute to the development of a more thorough knowledge of this emerging topic.

It is important to note that, up until now, research has concentrated on green practices that strengthen green brand equity rather than thoroughly exploring the types of practices—like greenwashing—that undermine green brand equity (Qayyum et al., 2022). According to the studies by Ha et al. (2022) and Ha (2022), although a direct correlation between greenwashing and green brand equity remains unproven, certain mediating factors have been identified in this relationship. This may not only elucidate critical issues but also foster the development of more robust knowledge in this dynamically changing field.

In light of the above and given the notable dearth of research on the relationship between greenwashing and green brand equity, this study aims to identify the factors influencing it. For a comprehensive analysis of this relationship, it is crucial to fully understand the factors that could influence or modify it, both positively and negatively. Consequently, this study will provide valuable insights into the dynamics between greenwashing and green brand equity. To that end, employing an exploratory methodology with a qualitative approach and emphasis on a conceptual search, the primary authors and associated factors contributing to the context under study will be identified and examined. This method facilitates a profound and detailed comprehension of the subject matter, emphasizing the relevance of key authors and the precise identification of influential factors in this research area.

The rest of this paper is divided into six sections. Section 2 extensively discusses the employed methodology, highlighting the four phases implemented in the process. Section 3 meticulously analyzes the obtained results after reviewing relevant documents. Section 4 reviews the most significant research conducted to date in this field. Section 5 outlines the main conclusions drawn from the study. Finally, Section 6 delineates future research avenues proposed by the authors.

The analysis followed the methodology proposed by Castellanos Domínguez et al. (2011), which was chosen for its systematic approach to examining trends by gathering data from multiple scholarly sources. This methodology stands out for its flexibility and adaptability, enabling a comprehensive examination of the current knowledge landscape through four essential phases. In the first phase, research needs are identified, and key search objectives are defined. The second phase involves searching for and downloading information, followed by thorough data cleaning. During this stage, the most relevant documents are carefully evaluated. In the third phase, themes and analytical concepts are reviewed in detail to consolidate the conceptual framework. Finally, in the fourth phase, the most significant findings obtained throughout the research are presented.

The selection of papers for this research required careful consideration of specific inclusion and exclusion criteria. Specifically, scholarly materials were identified employing relevant keywords and titles. In examining the impact of greenwashing on brand perceptions, studies that used terms like brand* (applying the Boolean operator to encompass various term variations) and greenwashing were included in the analysis. Special consideration was given to articles that explicitly studied greenwashing, green brand equity, or the relationship between these two concepts. Additionally, papers written in English or Spanish were included to ensure significant representativeness and depth of coverage of the topic.

To guarantee accuracy and comprehensiveness in the literature review, a three-phase exclusion protocol was implemented. Records with inappropriate or incorrect indexing were removed, which contributed to database consistency and precision. Also, based on their titles and abstracts, studies that did not align with the specific research questions were excluded from the analysis. This included studies that only mentioned greenwashing superficially without thoroughly examining its impact or relationship with brands.

Following this process, the appropriate databases for data collection were selected. The chosen platforms were Web of Science and Scopus, known for their ability to perform highly detailed and specific search queries (Pranckutė, 2021). The selected keywords were (i) greenwashing and (ii) branding (brand*). The search equation for Scopus was (TITLE-ABS-KEY (brand*) AND TITLE-ABS-KEY (greenwashing)), and for Web of Science, it was greenwashing (All Fields) AND brand* (All Fields). A crucial aspect was the year of publication of the papers to review, especially since the concept of green brand equity was first introduced in 2010. Therefore, this study focused exclusively on literature published from that year onward.

The initial search yielded 130 documents in Scopus and 102 in Web of Science. To optimize the analysis, documents were selected using the AI web platform Rayyan.ai, which simplifies the review by identifying duplicates and facilitating efficient data cleaning. As a result, 78 duplicates were identified, leaving 153 documents for analysis. During the initial screening, documents meeting the criteria were preliminarily selected by reviewing titles and abstracts, resulting in 51 documents for further analysis. In the second screening phase, a complete analysis of the selected papers revealed that five explicitly addressed the dynamics between greenwashing and green brand equity. These studies focused on understanding how various factors, whether mediating or moderating, directly or indirectly influence this relationship. For their part, 35 papers investigated this relationship indirectly, exploring how greenwashing impacts brands from multiple perspectives and through different factors, potentially leading to negative consequences for their reputation or image. This could ultimately translate into detrimental effects on green brand equity. The remaining 11 documents, although they addressed issues related to greenwashing, did not directly examine its impact on brands but rather discussed the various problems associated with this phenomenon. Accordingly, only 40 papers were included for the literature review.

This section presents an assessment of the findings—from the identification of trends and patterns to the analysis of connections in the data. Additionally, it discusses the practical and theoretical implications of these findings. It includes a critical assessment of the validity and applicability of the obtained results. This section is important because it places the results in a larger academic and practical framework, especially regarding the phenomenon of greenwashing and its impact on brands.

Greenwashing is an obstacle to green marketing because it makes consumers more skeptical of green claims. This study addressed the complex relationship between greenwashing and green brand equity, revealing critical aspects that influence this dynamic. The existing literature in this field was reviewed and analyzed to identify and summarize key factors that could mediate or moderate the relationship between these two variables. The findings reveal a growing academic and practical interest in this topic, especially in the last four years, with a record number of publications on this matter in 2023.

The results also highlight the importance of certain elements in the relationship between greenwashing and green brand equity: green trust, green brand image, brand credibility, green satisfaction, green brand association, green concern, green confusion, green brand attitude, word of mouth, brand avoidance, green perceived risk, green brand perceived value, green loyalty, and green brand legitimacy. Some studies highlight the direct negative impact of greenwashing on green brand equity, while others suggest an indirect influence via mediating factors. This mixed landscape demonstrates the need for more clarity and depth in future research.

From a practical perspective, the findings suggest that brands should focus on fostering green trust using authentic and transparent practices, thus establishing a solid and credible green brand image. Investing in brand credibility and clear communications of environmental commitments is a key strategy to mitigate the negative effects of greenwashing and improve green brand equity.

In theoretical terms, this study sheds light on areas that have been little explored so far (e.g., green experiential values) and poses crucial questions on the perception of green brand equity and its influence on the general perception of a brand. In addition, it argues that the notion of green brand legitimacy and its impact on consumers’ perceptions and attitudes should be better understood.

Most studies in this area have focused on the relationship between greenwashing and consumer reactions, business performance, and market value (Akturan, 2018; Santos et al., 2023a). However, the effects of greenwashing should be studied more in depth to expand the knowledge of sustainable marketing practices and their impact on consumer perception. This includes its long-term influence on critical aspects, such as the loyalty, satisfaction, and trust (Pimonenko et al., 2020) of brands that promote environmental initiatives (Ha et al., 2022). Green communication strategies should be analyzed in detail to reduce consumer confusion, thus ensuring a clear and accurate communication of the environmental efforts made by businesses (Ha, 2022). Furthermore, future studies should explore the phenomenon of brand aversion, especially in situations where negative environmental perceptions can have a negative impact on brand equity (Xiao et al., 2022). This comprehensive approach will enable not only a better understanding of the interaction between brands’ sustainability policies and consumer perceptions but also the development of more effective strategies to promote an authentic commitment to sustainability.

In addition, future research should investigate different product categories because they could moderate the interactions (Akturan, 2018; Santos et al., 2023a). Other moderating factors, e.g., environmental knowledge and green concerns, may also influence the results (Qayyum et al., 2022). Consequently, future studies could focus on how customers analyze and formulate their responses to corporate social responsibility and corporate environmental policies (Gutiérrez Gutiérrez, 2021).

This analysis of greenwashing and its influence on consumer perception stresses the urgency of researching beyond its immediate effects, exploring its long-term impact on brand loyalty, satisfaction, and trust. Likewise, these phenomena should be studied in different product categories, taking into consideration factors such as consumer environmental knowledge. In sum, marketing and communication strategies should promote an authentic commitment to sustainability, thus contributing to a more positive and transparent interaction between brands and consumers.

How to cite: Suárez Gutiérrez, S. A., Sánchez Torres, J. A., & Montoya Restrepo, L. A. (2024). A Review of the Factors Influencing the Relationship Between Greenwashing and Green Brand Equity: A Research Agenda. Revista CEA, 10(23), e2991. https://doi.org/10.22430/24223182.2991