When money talks, ESG falls silent: Evidence from US lobbying and disclosure

This study examines the relationship between lobbying contributions and environmental, social, and governance (ESG) disclosure among S&P 500 firms in the United States (US) from 2014 to 2022. Using firm-level data from Bloomberg and the LSEG Workspace databases, we implement the GMM-SYS Arellano-Bond estimator to assess how the amount of lobbying contributions influences sustainability transparency. Our findings reveal a significant inverse relationship between the two variables. This suggests that firms engaging more intensively in lobbying may strategically limit their transparency in sustainability reporting, potentially using political influence as a substitute for public accountability. These results underscore the importance for regulators to reassess existing disclosure frameworks and consider targeted interventions-such as enhanced oversight or incentive schemes-to discourage greenhushing practices and ensure that lobbying does not undermine the credibility of ESG communication.