["Business Ethics, the Environment &Responsibility, EarlyView. ", "\nABSTRACT\nConsumers today are uncertain about companies' motivations behind their practices and advertisements, leading them, in particular, to articulate public criticism about rainbow‐washing. Rainbow‐washing, a manifestation of corporate greenwashing specifically targeting the LGBTQ+ community, occurs when organizations publicly endorse LGBTQ+ causes while their actions or policies fail to align with these professed values. This study examines the effects of rainbow‐washing on brand loyalty and sustainable business practices in Italy through performative corporate social responsibility (PCSR) approaches and consumer perception measures. Data analysis was conducted using regression analysis and structural equation modeling after distributing the questionnaires to 378 Italian consumers. The findings demonstrate how rainbow‐washing produces two negative effects on CSR activities and consumer understanding but creates two positive impacts on brand loyalty and sustainable behavior attitudes. Sincere LGBTQ+ advocacy activities strengthen consumer brand loyalty and produce positive attitudes toward sustainable practices. The combination of authentic CSR initiatives with good consumer impressions enables brands to foster loyalty and advocates LGBTQ+ equality. Through rainbow‐washing, organizations affect how customers perceive them and their CSR activities. Genuine inclusivity represents a crucial element for businesses seeking sustainable achievement, while presenting long‐term business benefits to companies that truly support LGBTQ+ advocacy and sustainable practices. This research boosts knowledge about the interconnected effects between rainbow‐washing alongside brand loyalty and sustainable practices within Italian markets, while offering insights to firms together with policymakers and scholars researching CSR and LGBTQ+ advocacy and consumer behavior.\n"]