Determinants of consumer evaluation of sustainability claims : The moderating effect of regulatory focus
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- Master Thesis 
Green communication has become the hot topic of this decade. With environmental problems and sustainability issues increasing at an alarming rate, regulating authorities have started pressurizing companies all over the world to focus on sustainability initiatives. As a result, many companies started focusing on green communication strategies to improve their environmental positions. While, some companies genuinely reduced their environmental footprints, several others started claiming to be environmentally responsible when they were not, which is commonly referred to as Greenwashing. Unrestrained use of green marketing coupled with misalignment of CSR initiatives adversely affected the perceived green performance of many companies. This negatively affected the stakeholder´s preformed impression about the company´s green commitment, which is also referred to as Green Brand Equity. This research work targets to identify the important ethical principles that influence Green Equity and perceived Greenwashing. Structural equation modeling (SEM) was used to test four hypotheses on two main determinants of Green Equity and perceived Greenwashing. The two main determinants were identified from the ethical principles of stakeholder evaluation. Perceived contribution to a sustainability problem and Perceived opportunity to solve a sustainability issue were studied as the two main determinants in this Master Thesis. Perceived opportunity to solve showed a significant positive effect on Green Equity and a negative effect on Greenwashing. While Perceived contribution to the sustainability issue demonstrated a negative effect on Green Equity and a positive effect on Greenwashing. This finding suggests that green messages communicating about a company’s initiatives to solve its own sustainability problems triggers negative responses and suspicion of Greenwashing. Testing the moderating effects of consumer´s regulatory focus revealed promotion focus to strengthen the causal effect of both determinants while prevention focus to have no significant interaction effect.