Abstract: Based on catering theory, this study employs a difference-in-differences model to investigate the impact of capital market liberalization on environmental, social, and governance (ESG) reporting greenwashing using mainland Hong Kong Connection Programs as a quasinatural experiment. Our findings indicate that corporate management increasingly engages in ESG reporting greenwashing in capital market liberalization to cater to foreign investors. This conclusion remains valid after controlling for endogeneity. Mechanistic analysis indicates that investor sentiment increases with capital market liberalization. In response, corporate management intensifies ESG reporting greenwashing to cater to foreign investors, and analysts' focus does not serve as a supervisory mechanism for restraining ESG reports greenwashing. Heterogeneity tests demonstrate that ESG reports greenwashing within the capital market diminishes for mandatory disclosure and state-owned firms. However, ESG reports greenwashing intensifies among firms facing high financing constraints amid capital market liberalization. Overall, we identify a significant catering effect on ESG reporting amid capital market liberalization, offering a novel theoretical framework on greenwashing in ESG disclosures.

第一作者：刘广瑞，绍兴文理学院商学院副教授，研究方向：财务与会计。

该成果以“How do firms react to capital market liberalization? Evidence from ESG reporting greenwashing”为题，2024年4月刊发于《CORPORATE SOCIAL RESPONSIBILITY AND ENVIRONMENTAL MANAGEMENT》杂志（中科院SSCI二区，JCR一区）。