Have you published a message on social media, your website, and in newsletters that your company, its products, and services are green and sustainable? Then you might be greenwashing.
Relax. You're not the only one. Sustainability is a mega trend, and increasingly more companies are realizing that sustainability and social responsibility are profitable. It has been proven that consumers prefer companies and products that have a clear sustainability focus. Obviously, all companies have an interest in showcasing their contribution to a better world.
Numerous companies have taken real responsibility. They are in the process of changing their business models to accommodate economic as well as climate and social aspects. Others engage in so-called greenwashing.
But what exactly is greenwashing? And how can you avoid it?
This is greenwashing
Greenwashing is a type of marketing that convey a false impression or misleading information regarding the sustainability of a product, service, or business.
Maria Peltokangas, CEO, and senior advisor in Corporate Good and co-author of the book "Sustainable business - A practical guide on how to secure the company for the future", says that “greenwashers” are conveying a false impression or providing misleading information about how their products or service are more environmentally sound.
A known example of greenwashing is Volkswagen, which admitted to cheating emissions tests by fitting some of their vehicles with a device, which could detect when the car was undergoing an emissions test and alter the performance to reduce the emissions level. At the same time, Volkswagen used a lot of effort and money on marketing campaigns showing their car’s low emissions and eco-friendly features. The real story was that these engines were emitting up to 40 times the allowed limit for nitrogen oxide pollutants.
- Another company may utter: “Welcome to our green week. We ensure that everything you buy in the online store this week is climate-compensated when we ship it home to you.” This is not a green week. The company is merely trying to lure consumers to buy more products and then climate-compensating the shipment of the products. This is one example of greenwashing, says Maria.
- Another example is when an airline claims that it is the most climate-friendly company in the industry. But can one say that an airline is climate-friendly? Such allegations are also greenwashing, she continues.
Greenwashing confuses consumers, undermines businesses that are making a sustainable effort, and makes it difficult for consumers to assess which products and services are truly sustainable.
Show & tell
More and more greenwashers are being caught and must publicly apologize for bad behavior. Increased knowledge of greenwashing is positive. At the same time, companies must not be frightened of speaking about how they work with sustainability, as this might inspire other companies to act.
Maybe it is time to dust off and update the phrase "show, do not tell" to "show & tell". Maria promotes sustainability reporting as an important tool.
- Reporting on sustainability is very important. Because the focus is on what you measure, she says.
Due to a lack of regulation, companies can pick and choose what they report on and how. A standard for sustainability reporting, such as the Nordic SustainabilityReporting Standard, will lead companies to report on the same key figures and indicators. This makes it more challenging to greenwash products and services.