Greenwashing as a Business Risk: How ESG Claims Influence Trust and Purchase Decisions of Indian Consumers

Abstract

This study looks at how greenwashing affects consumer trust and buying behavior in India. Greenwashing means when companies pretend to be environmentally friendly just to attract customers. The study also focuses on ESG, which stands for Environmental, Social, and Governance practices. These are the ways companies take care of the environment, society, and follow fair rules.
The research uses primary data, which means the data was collected directly. A survey was conducted with 51 people from different age groups and education levels. The questionnaire asked about their knowledge of sustainability and ESG, how they feel about company claims, their views on greenwashing, and how all this affects their trust and buying decisions.
The results show that many Indian consumers, especially young and educated people, are well aware of sustainability and ESG practices. ESG claims often make a brand look more trustworthy and increase the chances of people buying its products. However, many respondents also felt doubtful and believed that companies use ESG mainly as a marketing tool.
Most respondents were aware of greenwashing. The study found that when consumers notice greenwashing, their trust in the brand drops sharply. Many people said they would completely stop supporting a brand if they found its ESG claims to be false or misleading.
The study also shows that transparency is very important to rebuild trust. Consumers said that clear reporting, checks by outside experts, and independent verification help make ESG claims more believable.
Overall, the study concludes that honest and proven ESG practices influence buying decisions and give companies an advantage over others. It highlights the need for companies in developing markets like India to follow ethical, transparent, and responsible sustainability practices.