Do images help? The impact of proenvironment photographs and graphs in environmental disclosures on investor perceptions and willingness to invest

Abstract This study investigates the effects of proenvironment photographs and graphs in environmental disclosures on potential investors' perceptions and willingness to invest, considering the moderating role of a company's environmental performance. An online experiment was conducted with experienced investors, where participants evaluated a hypothetical company with varying environmental performance outcomes (negative or positive) presented in different formats (text only, text with photographs, or text with graphs). The results indicate that proenvironment images enhance perceived environmental responsibility for companies with negative environmental performance, whereas processing fluency is improved when the image type aligns with environmental performance. Moreover, perceived environmental responsibility mediates the impact of images on the willingness to invest in negative performance contexts. In contrast, processing fluency mediates this effect for graphs in positive performance contexts. These findings offer guidance for company managers in effectively presenting environmental data and highlight the potential risks for policy‐makers regarding the misuse of images.