The Role of Independent Audit in Controlling Greenwashing Risk in ESG Information: An Analytical Framework and Policy Implications for Vietnam’s Capital Market

Le Thi Thu Huyen

doi:10.56201/jafm.vol.12.no7.2026.p79.86

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The Role of Independent Audit in Controlling Greenwashing Risk in ESG Information: An Analytical Framework and Policy Implications for Vietnam’s Capital Market

Le Thi Thu Huyen

Abstract

As environmental, social and governance disclosure becomes widespread while independent assurance remains largely voluntary, the gap between a firm’s reported sustainability image and its actual performance creates room for greenwashing. Using a qualitative desk- research method comprising synthesis, analysis, comparison and evaluation, this paper clarifies the nature and forms of greenwashing in ESG information, builds an analytical framework linking independent-audit mechanisms to each form of greenwashing, and derives policy implications for Vietnam. The analysis shows that assurance can mitigate greenwashing by reducing information asymmetry, but its effectiveness is conditional on the level of assurance, practitioner competence, independence and the existence of suitable reporting criteria. On this basis, the paper proposes stakeholder-specific recommendations for Vietnam’s capital market in the context of the forthcoming International Standard on Sustainability Assurance 5000.

Keywords

greenwashingESG assuranceindependent auditsustainability reportingVietnam.

References

European Securities and Markets Authority. (2024). Final report on greenwashing (ESMA36- 287652198-2699). Paris: ESMA. https://www.esma.europa.eu/sites/default/files/2024- 06/ESMA36-287652198-2699_Final_Report_on_Greenwashing.pdf Glocert International. (2026). How sustainability assurance reduces greenwashing risk. https://www.glocertinternational.com/resources/articles/how-assurance-reduces- greenwashing-risk/ Government of Vietnam. (2022). Decree No. 06/2022/ND-CP of 7 January 2022 on the mitigation of greenhouse gas emissions and the protection of the ozone layer. Hanoi. Government of Vietnam. (2025). Decree No. 119/2025/ND-CP of 9 June 2025 amending and supplementing a number of articles of Decree No. 06/2022/ND-CP. Hanoi. International Auditing and Assurance Standards Board. (2024). International Standard on Sustainability Assurance 5000, General Requirements for Sustainability Assurance Engagements. New York: IFAC. https://www.iaasb.org/focus-areas/understanding- international-standard-sustainability-assurance-5000 International Corporate Governance Network. (2024). Investor viewpoint: The assurance of sustainability reporting. London: ICGN. https://www.icgn.org/sites/default/files/2024- 07/ICGN%20Investor%20Viewpoint%20- %20The%20assurance%20of%20sustainability%20reporting.pdf International Federation of Accountants. (2025). The state of play: Sustainability disclosure and assurance - Five-year trends and analysis (2019–2023). New York: IFAC. https://www.ifac.org/knowledge-gateway/audit-assurance/publications/state-play- sustainability-disclosure-and-assurance Ministry of Finance. (2020). Circular No. 96/2020/TT-BTC of 16 November 2020 guiding information disclosure on the securities market. Hanoi. Frendy, Oshika, T., & Koike, M. (2024). Environmental greenwashing in Japan: the roles of corporate governance and assurance. Meditari Accountancy Research, 32(7), 266-295. Sneideriene, A., & Legenzova, R. (2025). Greenwashing prevention in environmental, social, and governance disclosures: A bibliometric analysis. Research in International Business and Finance, 74, 102720. https://doi.org/10.1016/j.ribaf.2024.102720 Zioło, M., Bąk, I., & Spoz, A. (2024). Literature review of greenwashing research: State of the art. Corporate Social Responsibility and Environmental Management, 31(6), 5343-5356.

The Role of Independent Audit in Controlling Greenwashing Risk in ESG Information: An Analytical Framework and Policy Implications for Vietnam’s Capital Market

Abstract

Keywords

References

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