The pathway to curb greenwashing in sustainable growth: The role of artificial intelligence

Artificial Intelligence (AI) can improve production efficiency and general quality of life through assisting human labor, potentially leading to the conversion of employment types, enhancing industrialization, and upgrading energy structure. This paper enriches the role of AI in improving sustainable growth by curbing hypocritical sustainable and greenwashing behaviors. By accessing the panel data from Chinese listed-firms for the period 2014–2021, we have shown that AI can significantly mitigate the existence of greenwashing behaviors by raising the disclosure quality of ESG rating scores. Moreover, the role of AI in mitigating greenwashing behaviors performs significantly in SOEs, less pollution-intensive industries, high environmental regulation and less developed green finance regions. Furthermore, the potential mechanisms of AI in mitigating greenwashing behaviors are displayed, including alleviating financial constraints, easing management cost, improving green innovations.