[EurOMA Annual Conference 2025] The Green Gamble: Do Regenerative Claims Pay Off in Fashion’s Stock Market?

Regenerative agriculture is a relatively new trend in the textile industry, and fashion brands are starting to invest in it, thus publishing press releases and corporate announcements to disclose their commitment to this practice. This study aims to observe how and when stock markets react to these announcements. By conducting an event study, we find that these announcements receive positive stock returns in the short term, while negative in the long-term. We further analyze the content of the announcements to find that claim greenwashing is rightfully penalized, while executional greenwashing is rewarded.