Customer ESG performance and supplier greenwashing behaviour: evidence from China

Based on a Chinese sample of customer-supplier firm pairs from 2012–2022, we explore the impacts of customer ESG performance on supplier greenwashing behaviour along the supply chain. The results indicate that customer ESG performance can effectively inhibit supplier greenwashing behaviour, and the association is particularly pronounced with lower supplier’s bargaining power or lower customer’s greenwashing tolerance. Our findings offer insights into the development of greenwashing correction mechanisms within the context of China.