Eco-friendly products and ethical businesses are becoming more popular. Even though this is a very good thing, it has also led to a rise in greenwashing.
According to Investopedia greenwashing is the process of conveying a false impression or providing misleading information about how a company’s products are more environmentally sound.
Greenwashing is considered an unsubstantiated claim to deceive consumers into believing that a company’s products are environmentally friendly.
Basically, greenwashing refers to misleading or deceptive marketing of a business or product’s environmental effect.
It might be as simple as the name of a product, or it can go as far as altering carbon emission data.
History of Greenwashing
Greenwashing dates back to the 1960s, when the nuclear power industry wanted to stay competitive during the anti-nuclear movement.
However, the word itself was invented in 1986 by Jay Westerveld in reaction to hotels that urged guests to reuse towels but didn’t take any other initiative to protect the environment.
Since then, greenwashing has become a standard corporate business practice.
According to a 2015 Nielson survey, 66% of consumers are prepared to pay extra for eco-friendly products, and sustainability characteristics impact 50% of purchase decisions.
So, green sells.
Businesses try to look like they care about the environment in order to keep the most environmentally-conscious customers. However they don’t actually alter their unsustainable business practices.
Real-Life Cases and Examples of Greenwashing
One of the first ones to run a greenwashing ad campaign was Chevron Corporation. In 1988 they started with their People Do commercials.
At the same time there were lawsuits being filed by both the EPA and Sierra Club over Chevron’s unlawful discharge of toxins into Santa Monica Bay, in violation of the Clean Air Act.
The basis of greenwashing is taking environmental claims that are more or less accurate and altering them to make the product or company seem environmentally friendly and sustainable.
The pure example of oxymoron is the clean coal U.S. presidential campaign topic.
#1 Volkswagen
One of the most well-known examples is when in 2015 Volkswagen manipulated emissions tests by installing a device on 11 million cars (between 2008 and 2015) that could detect when it was conducting an emissions test and adjust its performance in order to cut down emissions.
Not only that the cars weren’t eco-friendly as marketing campaigns claimed, but in reality they were releasing up to 40 times the permitted amount of nitrogen oxide pollutants.
Aside from the stock price drop, the expense of recalling the implicated cars, and VW’s first quarterly loss in 15 years, the corporation was also obligated to pay the EPA a fine for each vehicle that violated guidelines – a total of $18 billion.
After the scandal broke, CEO Martin Winterkorn resigned after admitting to breaking “the trust of our customers and the public.”
#2 H&M
In 2019 this fast fashion company announced the debut of a sustainable clothing line called the “Conscious Collection”. However, consumers had their doubts – and rightly so.
According to a report published in June 2021 by the Changing Markets Foundation, approximately 60% of H&M’s statements to customers were “unsubstantiated or misleading.”
H&M came out as the biggest offender among the 50 brands examined by the organization, with 96% misleading claims.
H&M’s Conscious Collection not only uses more synthetics than in its main collection, but also one in five items analyzed were found to be made from 100% fossil-fuel derived synthetic materials.
Changing Markets Foundation
#3 Nestlé
When Nestlé’s CEO Mark Schneider made a public statement in 2018 saying their ambition is to achieve 100% recyclable or reusable packaging by 2025”, Greenpeace called them out for their greenwashing attempt.
They pointed out Nestlé’s lack of a concrete plan of action and timeline: “Nestlé’s statement on plastic packaging includes more of the same greenwashing baby steps to tackle a crisis it helped create. It will not actually move the needle toward the reduction of single-use plastics in a meaningful way, and sets an incredibly low standard as the largest food and beverage company in the world.”
Nestlé, along with Coca-Cola and PepsiCo, were rated the world’s top plastic polluters for the third year in a row in Break Free From Plastic’s 2020 annual report.
Also, in 2008 Nestle came under criticism from environmental organizations in Canada by claiming that “bottled water is the most environmentally responsible consumer product in the world”.
#4 IKEA
With Simple, long-lasting, and affordable products, IKEA was seen as a shining example of an environmentally friendly corporation for years.
Until June 2020 when Earthsight’s report came out after 18 months of investigation revealing that the company has been selling furniture manufactured from illegally sourced wood for quite some time.
The wood comes from trees in forests in remote protected areas of Siberia in Russia.
According to Earthsight, shoppers around the world have been buying IKEA products made with this illegal wood every two minutes.
Even though IKEA denies wrongdoing and insists the wood was legally harvested, they have nonetheless announced a temporary ban on sanitary felled wood from Siberia and the Russian Far East.
There are many more companies accused of being involved in greenwashing – Apple, Starbucks, Zara, Adidas, Santos, National Australia Bank (NAB), Coca-Cola, Shell, ExxonMobil – to name a few.
How to Spot Greenwashing?
Since the 1980s, greenwashing has developed, making it more difficult for the untrained eye to spot. When deciding if a company is guilty of greenwashing, these are some of the things to look out for.
- Lesser of Two Evils: This occurs when businesses emphasize one positive feature of a product that is otherwise harmful. An example would be when palm oil lobbies argue that palm oil is better than other crops because it has a higher yield, meanwhile hiding the deforestation problem and human rights abuses.
- Overblown Statements: Consumers may be deceived by companies’ use of words and phrases that are accurate yet misleading. Increasing the recycled content from 2% to 3%, for example, might lead a clothing manufacturer to claim that their products are now created with 50% more recycled fibers. It is accurate, but oversold and misleading at the same time.
- Withheld Information: Companies often focus on positive environmental facts about their products, but they try to avoid talking about aspects of their products that are bad for the environment. For example, an electric vehicle producer might boast a car’s low fuel consumption, while making no mention of the ecologically damaging mining practices used to make the lithium batteries.
- Irrelevance: making claims that are technically accurate but have little effect on the environmental impact of their products.
- Vagueness: Brands making broad statements about their sustainability that are not specific enough such as ‘new and improved’, ‘non-toxic’, ‘made with recycled materials’ etc.
- Hidden Trade-Offs: Brands may promote a new change as environmentally friendly while neglecting its negative consequences. As an example, Starbucks introduced straw-free lids to reduce plastic waste, but these new lids actually used more plastic than the old ones.
- Symbolic Actions: Companies often highlight a small and insignificant step forward that has minimal impact on the company’s total environmental impact.
- Lack of Proof: The corporation may make claims about its eco-friendliness, but without providing certificates or other proof to back them up.
- Picture suggestions: Greenwashing may be as simple as packaging items in aesthetically pleasant ways to imply its eco-friendliness.
In addition, there are internet tools and search engines like Project Cece and Ethical Made Easy that may help you in finding sustainable businesses.
How to Avoid Greenwashing?
As seen above, a lot of companies will do whatever it takes to make (more) money. In these efforts they don’t concern themselves with notions like morale, ethical practices or truth.
If you want to do better than to fall victim to these practices, as a consumer you can start by just being more aware, even cautious when buying things.
If something appears a little fishy, chances are it is.
Take a closer look at the product’s label. Analyze the components.
A company may lie on the label, but it is illegal to lie about the product’s components. Make certain that the “organic” product has components that you have heard of before.
Also, check for certificates issued by a third-party organization, such as: The Carbon Trust Standard, USDA certified organic, and/or Forest Stewardship Council (FSC).
There are many businesses that genuinely care about being sustainable every step of the way, and you get to vote with your money for them.
The more we turn to those, the more they will grow and reflect our positive and green values.
Sustainability should become a lifestyle and a norm for all. Why wouldn’t you lead the way in your community? 🙂
If you want to learn more about deceptive practices, be sure to read our article Is Bamboo The Hot New Wood Material of the Future?