While public skepticism around corporate sustainability initiatives continues, so does greenwashing. Aside from false or misleading claims, greenwashing often appears in subtle ways that try to shift consumer focus away from corporate responsibility. For example, major home improvement retailers encourage customers to recycle, yet they continue to sell billions of dollars of toxic, environmentally damaging products every year.
The core complication with greenwashing is the exploitation of consumer trust, especially in those who express genuine concern for the environment. Today’s consumers care – period. Their concerns about a business’s environmental practices, organizational culture, and ethics are what drive buying decisions when choosing one brand over another. (You can download our eBook on greenwashing here and read our tips for managing the impact on your sustainability brand’s PR communications strategy.)
In an increasingly competitive consumer market, standing out above the rest is necessary for success. By understanding the nuances of greenwashing and its implications, businesses are better equipped to overcome key greenwashing mistakes often made by large corporations.
A Timeline of Greenwashing
The term “greenwashing” is credited to environmentalist Jay Westerveld, who first thought of it in 1983 while traveling. A hotel asked customers to reuse towels to reduce ecological damage, but the sprawling resort was expanding without much regard to nearby coral reefs. Three years later, while writing a term paper, Westerveld wrote something to the effect of, “It all comes out in the greenwash.” A classmate worked for a literary magazine and asked Westerveld to expand on the idea. The publication had a large readership, and the term “greenwashing” caught on in the media.
However, the practice of corporate greenwashing existed decades before Jay Westerveld even coined the term.
Greenwashing proliferates with the rise of the 1960s anti-nuclear movement. Most consumers get their news from TV, radio, and print media, while corporations use these same platforms to run commercials and print ads.
Chevron launches an expensive print and TV ad campaign to showcase its environmental dedication. As the notorious “The People Do” advertising series ran, the company was actively breaching the Clean Water Act, the Clean Air Act, and dumping oil into wildlife refuges. Many environmentalists call this campaign the “gold standard” of greenwashing.
The decade begins with Chevron winning an Effie advertising award for “The People Do” and the campaign becomes a case study at Harvard Business School. However, public perception is changing as consumers begin to smarten up about sustainability. By the end of the decade, “greenwashing” officially enters the Oxford English Dictionary.
The Impact of Greenwashing Today
Greenwashing is threatening to undermine progress in sustainability, according to the 2021 Sustainability Trends Report (STR) from Generation Investment Management. The firm finds there is “growing unease at the low quality of some net-zero commitments” by companies and governments, as well as the absence of guardrails for natural solutions and the sustainability of “offset” markets.
Against this backdrop of corporate unaccountability, misleading sustainability claims are spreading online at an alarming rate. National consumer protection authorities in the EU have reason to believe that in 42% of cases, environmental claims were exaggerated, false, or deceptive and could potentially qualify as unfair commercial practices under EU rules.
It’s not surprising that the UK’s Competition & Markets Authority (CMA) published a Green Claims Code aimed at protecting consumers from misleading environmental claims amidst concerns over greenwashing. Here in the U.S. the Securities and Exchange Commission (SEC) has signaled the importance of clear and consistent disclosure when it comes to climate-related impacts. Notably, the SEC has not updated its corporate disclosure guidance in more than a decade, but it has solicited comments regarding the possibility of a mandatory climate-related disclosure regime and is expected to pursue an approach.
The STR 2021 report warns that the threat of greenwashing is rising, as sustainability-related commitments, such as “net zero,” “nature positive,” and “regenerative agriculture” proliferate. Often these commitments tie in social issues with terms like “just transition,” “diversity & inclusion” and “building back better.” While there are ample opportunities for sustainable investing, they may do more harm than good if the bar isn’t set higher, the report concludes.
About Sustainable PR
Sustainable PR is a green-focused public relations agency dedicated to advancing the growth and success of business with a mission in sustainability. As the green economy grows, Sustainable PR aims to give a boost to the sustainability sector by supporting the success of companies tackling the oncoming climate crisis and helping to move the economy forward towards a post-polluting world.
Founded in 2020, the company wins top media placements, develops key brand messaging and builds award-winning campaigns which help companies realize their sustainability commitments and take advantage of a growing sustainability market — all while contributing to a greener planet. For more information about the company’s mission and services, visit their website sustainablepr.com or call (518) 223-9962.