Do as I say, not as I do: Effects of national institutions on corporate greenwashing

• Greenwashing enterprises engage in ‘information filtering’. • We assessed the institutions effect on corporate greenwashing in Latin America. • Pressures from the institutional environment decrease greenwashing practices. • Higher regulatory quality tend to decrease companies’ involvement in greenwashing. • Greater market pressure tend to decrease companies’ involvement in greenwashing. Greenwashing enterprises engage in ‘information filtering’, selectively disclosing favorable environmental information while intentionally concealing negative aspects. In this study, we aimed to examine the effect of national institutions on corporate greenwashing in Latin America. Through the lens of institutional theory, we hypothesized that companies located in a country with better regulatory quality, located in a country with greater capacity for innovation, and when suffering greater market pressure are less likely to engage in greenwashing behavior. In the assessment, we considered 401 companies listed in the Refinitiv Eikon database for the 5 years (from 2018 to 2022) . By combining a symmetric (panel data analysis with fixed effect) and an asymmetric analysis (fuzzy set Qualitative Comparative Analysis - fsQCA) , we found pressures from the institutional environment, specifically regarding higher regulatory quality and greater market pressure, tend to decrease companies' involvement in greenwashing practices. We also detected seven groups of configurations for sufficient condition analysis against greenwashing, highlighting the influential role developed by regulatory quality. Our findings also reveal that larger firms and those with higher financial performance are more likely to engage in greenwashing. The results also indicate that firms with greater investment in R&D are more inclined to practice greenwashing. While these findings contribute significantly to institutional theory and the literature on greenwashing, they also have important implications for managers and policymakers.