[New Report Published] Sustainable Communication (No. 92) 'The Impact of Greenwashing on Corporate Value'

Mitsubishi UFJ Trust and Banking Corporation (President: Hiroshi Kubota) has published a report titled 'Sustainable Communication (No. 92): The Impact of Greenwashing on Corporate Value.'

≪Report Summary≫

- Primarily in Europe, environmental claims are shifting into a domain requiring legal proof. Vague or insufficiently substantiated claims can be considered greenwashing, posing significant management risks such as penalties, trading suspensions, and exclusion from value chains.

- The definition of greenwashing has recently expanded from mere 'intentional falsehood' to 'dishonest disclosure that does not accurately reflect reality.' An era has arrived where disclosing solid evidence and having criteria to evaluate it are crucial.

- Greenwashing can lead to long-term investor distrust, increasing the risk premium and thus the Weighted Average Cost of Capital (WACC), which can negatively impact fundraising and, consequently, corporate value. Conversely, honest disclosure based on international standards is believed to contribute to reducing capital costs and enhancing long-term corporate value.

For details, please refer to the report below.

d36656-338-005f7e498d16a5e0c5df52646dd4ef84.pdf

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【Contact for this matter】

Mitsubishi UFJ Trust and Banking Corporation
Corporate Consulting Division, Planning Group

Mail: cc-planning_post@tr.mufg.jp