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A Path Analysis of Greenwashing in a Trust Crisis Among Chinese Energy Companies: The Role of Brand Legitimacy and Brand Loyalty

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Abstract

For many energy companies in China, green brand strategy is becoming an important approach to enhance competitive advantage. However, greenwashing behaviors result in a crisis of trust. Existing research focuses on green marketing, but is silent on the institutional view of the trust crisis resulting from greenwashing by energy brands. Thus, this study takes a decoupling perspective from institutional theory and considers legitimacy, energy policy management, and green brand theories to shed light on the path from the decoupling of an energy brand from green promise (DEBG) to green energy brand trust (GEBT) and the role of brand legitimacy and brand loyalty. It then analyzes survey data to conclude that DEBG not only has a direct negative effect on GEBT but also has an indirect influence through the vital mediating role of green energy brand legitimacy. Moreover, brand loyalty is a moderating factor and can alleviate the energy brand trust crisis. These findings not only can enrich the theories of energy brand management and green marketing but also offer important implications for energy policy management.

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Acknowledgments

The authors gratefully acknowledge financial support from the National Natural Science Foundation of China under Grant nos. 71002072 and 71272063, from the Key Project and Youth Project of Humanities and Social Science of The Ministry of Education Grant no. 14JZD017 and 12YJC630187, from the Hubei Key Research Center for Humanities and Social Sciences Grant no. CJHIXM201407.

Author information

Authors and Affiliations

  1. School of Economics and Management, China University of Geosciences, Wuhan, China

    Rui Guo & Lan Tao

  2. Center for Digital Business and Intelligent Management, DBIM, China University of Geosciences, Wuhan, China

    Rui Guo

  3. Center for Jewelry Heritage and Innovation, China University of Geosciences, Wuhan, China

    Rui Guo

  4. Daniels College of Business, University of Denver, Denver, CO, USA

    Caroline Bingxin Li

  5. Economics and Management School, Wuhan University, Wuhan, China

    Tao Wang

Authors
  1. Rui Guo
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  2. Lan Tao
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  3. Caroline Bingxin Li
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  4. Tao Wang
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Corresponding author

Correspondence to Lan Tao.

Appendix

Appendix

Questionnaire

You are being invited to participate in a research study about green brand study. The Objective of this research project is to attempt to understand green brands.

There are no known risks if you decide to participate in this research study, nor are there any costs for participating in the study. The information you provide will help me understand green brands. The information collected may not benefit you directly, but what I learn from this study should provide general benefits to customers, companies, and researchers.

This survey is anonymous. If you choose to participate, do not write your name on the questionnaire. No one will be able to identify you. No one will know whether you participated in this study. Your participation in this study is voluntary. You are free at any time to leave if you feel comfortable.

What is Your Most Familiar Greenwashing Energy Brand?

  1. (a)

    If the answer is Sinopec, go on answering the following items.

  2. (b)

    If the answer is not Sinopec, stop here.

Please Read the Following Items and Give Your Answer Based on Your Real Thoughts About Sinopec with 1 (Strongly Disagree) to 5 (Strongly Agree)

1. The decoupling of an energy brand from “green”

The decoupling of an energy brand from “green”

1

2

3

4

5

(1) This energy brand (Sinopec) has not implemented its green promise that they committed;

     

(2) This energy brand (Sinopec) has a long distance to a green brand in your mind;

     

(3) This energy brand (Sinopec) exaggerated their products or services about the green performance in promotions.

     
  1. 1 = Strongly disagree, 5 = Strongly agree
  2. Source Delmas and Burbano (2011), Keller (1993) and Meyer and Rowan (1977)

2. Green energy brand legitimacy

Green energy brand legitimacy

1

2

3

4

5

(1) This energy brand (Sinopec)’s environmental performance is satisfactory;

     

(2) This energy brand (Sinopec)’s environmental performance is favorable to the public;

     

(3) This energy brand (Sinopec)’s environmental performance conforms to industry and social norms;

     

(4) This energy brand (Sinopec)’s environmental performance is appropriate;

     

(5) This energy brand (Sinopec) is a natural green brand;

     

(6) This energy brand (Sinopec)’s environmental performance is consistent with your cognition.

     
  1. 1 = Strongly disagree, 5 = Strongly agree
  2. Source Pratima and Clelland (2004)

3. Green energy brand trust

Green energy brand legitimacy

1

2

3

4

5

(1) This energy brand (Sinopec)’s environment commitment is generally reliable;

     

(2) This energy brand (Sinopec)’s environmental performance is generally dependable;

     

(3) This energy brand (Sinopec)’s environmental argument is generally trustworthy;

     

(4) This energy brand (Sinopec)’s environmental concern meets your expectations;

     

(5) This energy brand (Sinopec) is honest to environmental performance;

     

(6) This energy brand (Sinopec) can keep its words about the green environmental protection.

     
  1. 1 = Strongly disagree, 5 = Strongly agree
  2. Source Chen (2010) and Chaudhuri and Holbrook (2001)

4. Brand loyalty

Green energy brand legitimacy

1

2

3

4

5

(1) You will buy this energy brand (Sinopec) next time you buy energy products;

     

(2) You intend to keep purchasing this energy brand (Sinopec);

     

(3) You are committed to this energy brand (Sinopec);

     

(4) You are willing to pay a higher price for this energy brand (Sinopec) over other energy brands.

     
  1. 1 = Strongly disagree, 5 = Strongly agree
  2. Source Chaudhuri and Holbrook (2001)

Your Personal Information

  1. (1)

    Your age (1) Below 30 years old; (2)31–40 years old; (3) 41–50 years old; (4)51–60 years old; (5) Over 60;

  2. (2)

    Your income per month: (1) Below 3000RMB; (2) 3001–5000RMB; (3)5001–7000RMB; (4)8001–10000RMB; (5) Over 10000RMB;

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Guo, R., Tao, L., Li, C.B. et al. A Path Analysis of Greenwashing in a Trust Crisis Among Chinese Energy Companies: The Role of Brand Legitimacy and Brand Loyalty. J Bus Ethics 140, 523–536 (2017). https://doi.org/10.1007/s10551-015-2672-7

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  • DOI: https://doi.org/10.1007/s10551-015-2672-7

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