Does ESG Greenwashing Mislead Investors? Empirical Evidence from the Egyptian Stock Exchange (EGX) | ||
| المجلة العلمية للبحوث التجارية (جامعة المنوفية) | ||
| Articles in Press, Accepted Manuscript, Available Online from 21 November 2025 | ||
| Document Type: المقالة الأصلية | ||
| DOI: 10.21608/sjsc.2025.442224.1644 | ||
| Authors | ||
| مها محمد ربيع الشافعى* 1; Ahmed Hamed Mahmoud AbdElhalim2; شيرين شوقي السيد الملاح3 | ||
| 1كلية التجارة جامعة المنوفية | ||
| 2Faculty of Commerce, Banha University | ||
| 3كلية التجارة جامعة بنها | ||
| Abstract | ||
| Environmental, Social, and Governance (ESG) reporting has increasingly become a central component of investment analysis, concerns about greenwashing raise doubts about whether such disclosures genuinely inform capital allocation decisions. This study investigates whether ESG greenwashing misleads investors in the Egyptian capital market, where disclosure requirements have recently expanded but external verification and reporting quality remain limited. Using panel data from 180 firm-year observations of Egyptian Exchange (EGX) listed companies over the period 2022–2024, the research examines three dimensions of greenwashing: selective disclosure, expressive manipulation, and overall greenwashing level. Following the Ohlson (1995) value relevance framework and applying generalized least squares (GLS) regression to account for heteroskedasticity and serial correlation, the findings reveal a consistent and statistically significant negative impact of all three greenwashing indicators on investor decisions. ESG selective disclosure, expressive manipulation, and aggregate greenwashing each reduce the value relevance of accounting information, indicating that investors discount firms engaging in biased or exaggerated sustainability communication. The results also show that leverage and profitability enhance value relevance, while firm size, age, and Big 4 audit affiliation do not significantly alter investor reactions to ESG disclosure quality. | ||
| Keywords | ||
| ESG disclosure،greenwashing; value relevance; ، investor decisions | ||
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