Greenwashing is terrible for any business in any field because it erodes consumers’ trust and damages the company’s reputation. When a company is guilty of greenwashing, it implies that it is not trustworthy, which can have serious consequences. In addition to harming the environment, greenwashing also harms businesses financially by weakening their customer base and damaging their public image. This article will give tips on how companies can avoid greenwashing.
What is Greenwashing?
Greenwashing is making a business or product appear to be more environmentally friendly than it really is. It is often used by companies that want to seem like they are doing their part to protect the environment, but in reality, they are not.
There are many ways that companies can greenwash their products or businesses. For example, they might use some energy-efficient practices without reducing their overall energy consumption. Greenwashing can also occur when companies make false or misleading claims about their environmental impact.
Case Study: Environmentalists Sue KLM for Greenwashing
The Dutch airline KLM is being sued for greenwashing by two environmental organizations. Fossielvrij NL and ClientEarth claim that KLM’s “Fly Responsibly” campaign is misleading because it implies that flying is environmentally friendly.
The lawsuit claimed that KLM’s campaign violates the consumer laws of Europe, which prohibit companies from making false or misleading claims about their products or services.
They further said KLM offers a CO2ZERO product to customers stating that buying it will offset the carbon impact of their flight. According to environmentalists, customers paying to plant trees will not curb the damage of flying to the environment.
Case Study: Advertising Standards Authority Accuse HSBC of Greenwashing
The Advertising Standards Authority (ASA) of the U.K. is accusing HSBC of greenwashing. HSBC posted two ads at London and Bristol bus stops that are misleading. One stated that HSBC is committed to planting two million trees. The other said that it would provide clients financing amounting to a trillion dollars for their net-zero transition.
ASA stated that the ads make people believe that HSBC is contributing positively to environmental protection efforts and that this will influence people to support its financial services. However, ASA points out that HSBC finances oil, gas, and thermal coal and contributes significantly to greenhouse gas emissions. Its phaseout of such funding is slow, and it is committed to financing thermal coal up to 2040.
Check Your Advertising to Avoid Greenwashing
Businesses can avoid greenwashing by being honest about their environmental impact. Ensure that you and your advertising agency are on the same page about avoiding greenwashing. All ads and marketing materials for your company must avoid misleading messages and images not backed up by facts.
For instance, be careful with the use of the words “earth-friendly” or “eco-friendly” because even if the finished product itself is such, if a process used in its production or delivery is not sustainable, you are greenwashing. Do not use imagery that people associate with sustainability if you cannot back it up.
If you are being truthful, support your claims with verifiable information. Certifications from reputable sources are valuable. Give clear and detailed information that is easy to understand rather than generalities.
For instance, a label that says “made with organic cotton” can hide the fact that it contains only one percent organic cotton. Also, the cotton may be organic but purchased at an unfair price from growers. You can differentiate yourself and clearly show your sustainable practices by saying “made with 80% organic cotton sourced through fair trade”.
Omission is also greenwashing, as seen in the case of HSBC. Make sure you include the whole picture in the information you provide to the public.
Avoid Greenwashing by Walking the Talk First
Businesses can avoid greenwashing by implementing sustainable practices all throughout their operations that will truly make a difference. That means checking every step of the process from:
- choice of materials for production and packaging
- how these materials are produced
- how these materials are delivered to the company
- how the company manufactures the end products
- how the company packages the end products
- how the company delivers the end products
- how the company’s manufacturing operates before and after manufacturing the product, such as in cleanup and waste disposal
Apart from being responsible for their production, companies are also responsible for ensuring that their funding comes from investors who practice sustainability. They must check on their investors and include this information in their sustainability reporting.
Practice Genuine Business Sustainability
The key to avoiding greenwashing is for businesses to genuinely commit to sustainable practices. Do not just do it for the marketing or public relations value. You will only be damaging your reputation in the long run when people realize that you are not truly sustainable.
Adopting sustainable practices should be a part of your business model and overall corporate strategy because it is the right thing to do. It is good for business as sustainability improves resource efficiency, which reduces costs. It also helps companies become more resilient and adaptable to a changing world.
Sustainability must be ingrained in the culture of the organization from the top down, starting with the board of directors and CEO. They must lead by example and make sure that employees at all levels understand the importance of sustainability and how they can contribute to it.
Integrating sustainability into the business will require a change in processes and may entail some upfront costs. But in the long run, it will be good for business, the environment, and society.