What is Greenwashing

Greenwashing: Navigating Corporate Misinformation and Environmental Claims

What is Greenwashing

As consumer demand for action on climate change and environmental claims increases, so does the use of greenwashing – but what is greenwashing, exactly? Simply put, it is lying or misdirection about sustainability.

More and more companies are starting to take advantage of the growing interest of environmentally conscious consumers in sustainability, renewable energy and green initiatives. Whether it’s the cosmetic, automotive, packaging, fashion, food, marketing, finance, or energy sector, greenwashing is everywhere.

What is Greenwashing? How to Spot and Avoid it?

What Is the Meaning of Greenwashing?

Greenwashing meaning Source: The Manor

Greenwashing means when an organisation spends its resources and time marketing its brand position as sustainable and environmentally friendly without reducing its environmental impact.

One way to view greenwashing is through the lens of a deceitful green marketing tactic. It intends to gain favour with consumers who value environmentally friendly initiatives without actually doing so.

The fight against climate change is picking up. Corporate entities that engage in greenwashing and making misleading environmental claims undermine the efforts of sustainable brands that are working on reducing their greenhouse gas emissions and carbon footprint and adopting sustainable business practices.

Why Do Companies Greenwash?

Companies are aware that Gen Z favours sustainable brands that operate ethically and care about the environment. A recent sustainability report highlights that over 85% of environmentally conscious consumers have shifted to purchasing more sustainable products in the last 5 years. Additionally, on average, one-third of consumers will pay a premium on sustainable products, increasing to 42% among millennials. It is clear that there are financial benefits for companies that invest in sustainable initiatives – consumers demand it.

But it goes beyond consumers. Companies competing for investment and talented employees know there is an expectation for them to take serious action to protect the environment, tackle the climate crisis and show environmental responsibility. Moreover, regulators worldwide are focusing on companies’ climate action, given the risks the crisis poses to business.

Unfortunately, rather than undertaking the hard yards of taking real action, many companies continue to try to cut corners and make false claims. An environmental marketing claim should be specific.

Greenwashing Examples – Nestle, Volkswagen, Walmart

Some of the largest global brands have been implicated in high-profile greenwashing scandals. From Nestlé to BP, Volkswagen and Walmart – the list goes on.

One of the most iconic examples of greenwashing is Volkswagen. The German automaker installed software in their cars to cheat carbon dioxide emissions tests, falsifying results to make their cars appear far less polluting. It was only discovered in 2015, yet Volkswagen’s cars had falsified data since 2008. The result was USD35 billion in fines and nearly 1 million tonnes of additional emissions.

Most examples of greenwashing are less blatant, and the devil is usually in the detail. But for all that, the impact is just as important. A fascinating (and in-depth) analysis from the New Climate Institute illustrated that fact. Just 25 companies account for a remarkable 5% of global greenhouse gases emissions. All of them had headline goals and green claims to get to net-zero emissions. However, according to the report, only a mere 20% of the lofty pledges have been turned into cast iron emission reduction commitments to be achieved by the target year.

Source: Corporate Climate Responsibility Monitor 2022

Those scoring at the bottom of the integrity scale include major brands such as Nestle, Unilever and BMW. This is the kind of greenwash that can cost us our future.

Source: Corporate Climate Responsibility Monitor 2022

Stop Greenwashing – Leveraging On Our Voices to Demand Meaningful Change

The fact is that greenwashing or “green sheen” is a major environmental issue with significant environmental impact. After all, it undermines companies’ efforts that do adopt environmentally friendly practices and creates scepticism among consumers when they purchase products. In the end, greenwashing is bound to break customer trust in sustainable and eco-friendly brands that adopt sustainable practices.

With our busy lives, the sheer scale of information and complexity can be daunting for most of us. And whilst there is no easy solution, getting companies to live up to their promises is one of the most effective routes to tackling the climate change.

Greenwashing is everywhere. And whilst it is frustrating, the fact that companies are on record with their headline pledges is a powerful leverage point for us to demand meaningful change. Their corporate social responsibility is to be environmentally responsible and not mislead consumers. The most important thing to remember is that as people, staff, consumers and investors, time and time again, companies have listened to us when we speak up. So speak up we must.