Greenwashing – A deceiving practice that businesses should avoid at all costs
- 17 Nov 2023
We live in a day and age where the ongoing disruption of the natural world through human activities and the devastating effects stemming from it have brought sustainability to the forefront of global issues and implicitly turned it into a major point of interest for consumers and businesses alike.
As numerous studies have already made it abundantly clear, consumers these days are tech-savvy, generally more educated and better informed on a wide range of topics, including environmental protection, and there’s no room for doubt: they care about the planet and they want companies to care about it too. The trend is noticeable all across the globe, in both developed and developing countries.
This puts businesses across all industries in an extremely challenging situation, struggling to reconcile sustainability with profitability so they can keep consumers happy while also ensuring financial success. Since one can’t put a price on the health of the planet or the future of humankind, there’s really no other way forward for enterprises but to adhere to the eco-friendly movement and work towards achieving their ESG goals.
This has prompted many companies to focus on becoming more eco-friendly by implementing a variety of strategies and solutions. For example, in Sweden, a country that ranks high in terms of sustainable actions, a large number of companies have started using balers, known as balpress in Swedish, and compactors to improve waste management and ensure compliance.
Unfortunately, this increasing pressure combined with consumers’ positive attitude toward eco-friendly products and services has also created a fertile ground for the development of greenwashing – a phenomenon that has all the markings of sustainability but is anything but.
What is greenwashing?
Greenwashing is exactly what it sounds like: a marketing gimmick that aims to trick eco-conscious consumers into thinking that a product, service or the company offering them are more environmentally friendly than they actually are.
Greenwashing can be present in various forms. Some companies may invest heavily into green marketing and plaster labels like clean, eco-friendly and other similar vague and unverifiable terms on their products with no real evidence to back their claims. Other times, businesses engage in greenwashing by highlighting or presenting consumers only certain sustainable aspects about themselves in order to distract attention from the negative impact that their actions have on the environment and conceal their transgressions.
The term was coined by environmentalist Jay Westerveld in the ‘80s when TV, radio and newspapers were the only sources of information that consumers had at their disposal, so they couldn’t question or challenge the claims that companies made at the time. This made it much easier for businesses and corporations to paint themselves in a positive light and get away with exaggerations or blatantly false affirmations regarding their green credentials. And that’s exactly what happened.
In an attempt to keep up with current trends and capitalize on the growing demand for green products/services, many companies and organizations started to get ahead of themselves and make unsubstantiated eco-friendly claims. Concepts and terms like sustainability, green, eco-friendly, non-toxic, organic, and bio, began popping up everywhere, being overused to the point of becoming devoid of meaning, and the practice continues to this day.
The businesses that are following down the greenwashing path are just telling consumers what they want to hear but they are not making much or any effort to implement environmentally friendly practices and make their operations more sustainable.
The negative consequences of greenwashing on businesses
It’s obviously a lot easier to pretend you’re a green company than to actually do the work to become one. But although greenwashing might seem like a clever shortcut to attracting more customers and increasing profitability, here’s why businesses should steer clear of this approach.
First of all, feeding consumers false or deceitful information is both unethical and illegal. And in the age of the internet, if somehow greenwashing practices can escape regulators’ watchful eyes, consumers have the tools, ability and desire to dig deeper and debunk false claims made by the companies they do business with. Once the truth comes out, which always happens, all the parties affected directly or indirectly by these misleading practices, from consumers and investors to business partners and enforcement agencies are going to be unforgiving.
It doesn’t matter if the greenwashing is inadvertent or intentional. Just like in law, ignorance does not excuse inappropriate behavior. Consumers and regulators don’t care if a company’s intentions were noble or if they engaged in greenwashing deliberately. The outcome is the only point of concern here and if a company’s bad practices are revealed, the damage to its reputation can be irreversible, leading to loss of customers, severed business partnerships and increased scrutiny from authorities.
What’s more, the effects of greenwashing can reverberate across the entire industry. The actions of one bad actor are enough to cast a negative light on their whole sector and affect many other companies operating in the field, thus hampering the development of a sustainable economy.
How to avoid greenwashing
In recent years, regulators across the world have ramped up their efforts to protect consumers against the harmful effects of greenwashing and curtail this burgeoning issue. So, the easiest way to ensure your company is not accused of greenwashing is to comply with the guidelines and regulations created in this regard.
However, since greenwashing can be a rather slippery slope and businesses can sometimes slide down this path imperceptibly, there are other precautionary measures one can take to distance themselves from the risks of greenwashing. For starters, you need to be honest and transparent when it comes to your green credentials and the actions your company is taking towards boosting sustainability. You should provide clear information on your products/services and operations and back up sustainability claims with verifiable data.
Refrain from throwing around catchphrases and buzzwords that don’t mean anything just because they sound good. Also, it’s best not to use visual elements that convey a green image for your brand or products if there’s no justification for it.
Additionally, you should limit yourself to presenting your own achievements and progress in terms of environmental protection and not make yourself look good by pointing out other companies’ shortcomings.
Greenwashing is a complex issue and there’s a lot to be said about its impact on businesses and the economy. But the bottom line is that companies must take a clear stance in this respect and avoid greenwashing in all its forms.