Volkswagen is one of the world’s leading car manufacturers. It is no secret that automobiles are responsible for greenhouse gas emissions that harm the Earth, but automotive companies often promote their “high” gas mileage and other sustainable technology to appeal to environmentally-conscious customers. Imagine the surprise of consumers and regulators when Volkswagen vehicles were found to be “emitting nitrogen oxide pollutants up to 40 times the legal limit.” Even worse, the company had gone to evil lengths to arm their vehicles with a device to intentionally fool emissions testing software! The Volkswagen scandal is one of the most blatant examples of a practice known as greenwashing: when a company makes itself or a product they offer seem more sustainable than it truly is.
By supporting sustainable business(es), many consumers aim to steer corporate action towards tackling environmental challenges. With sustainability becoming increasingly important to consumers, businesses have responded by communicating their sustainability efforts through marketing initiatives. While marketing is great for spreading the word on the positive actions a business is taking, there have been many cases of corporate dishonesty when it comes to such efforts. Greenwashing presents a significant problem for sustainable development because it leads consumers to believe and support companies for being sustainable when this may really be a falsehood. Greenwashing hamstrings the ability of consumers to support truly sustainable companies, thereby taking power away from consumers to drive progress in sustainability. For this reason, greenwashing must be counteracted.t. This blog will outline concrete ways we can mitigate greenwashing.
There are two primary types of greenwashing: firm-level and product-level. Firm level greenwashing entails deception about a company’s environmental actions as a whole. Product-level greenwashing entails deception about an individual product’s environmental footprint. Specifically, greenwashing can be categorized into six different practices: the six sins of greenwashing. These six sins are:
1. Sin of the Hidden Trade-Off
2. Sin of No Proof
3. Sin of Vagueness
4. Sin of Irrelevance
5. Sin of Lesser of Two Evils
6. Sin of Fibbing
Of these six, vagueness, no proof, and hidden trade-off are the three most common (see above source) and constitute the greatest problems that need addressing.
Over the years, there have been many examples of greenwashing, ranging from subtle to blatant. The Volkswagen scandal is one of the most flagrant examples, but there are thousands of examples of greenwashing in the marketplace. Starbucks was accused of greenwashing when they introduced and marketed straw-less lids that contained more plastic than their lids with straws. Many beverage-producing companies, such as Coca-Cola and Nestle water (two of the world’s largest plastic polluters), have also been accused of overblowing their positive environmental impacts and downplaying the negative impacts of their packaging. These examples are merely scratching the surface; this problem is seen across many industries. Examples range from half-truths to systematic efforts to trick consumers and regulators, making greenwashing a complex issue to tackle with no one-size-fits-all solution. There are some actions, however, that can be taken to make headway in this issue. Though several other players are involved, ending greenwashing starts within businesses wanting to “do the right thing”.
Purpose-Driven Leadership is Essential
The role of corporate purpose and a culture of integrity cannot be overemphasized in ending greenwashing. Top leadership’s commitment to environmental and societal integrity and honesty with stakeholders is essential to tackle this issue. If any laxity is tolerated within an organization with regard to these principles, greenwashing will continue to persist. Leadership sets the tone for the entire organization when it comes to this issue. Marketers who are responsible for communicating with consumers will not have the incentive to act sustainably if the people above them don’t set an example of ethics, integrity, and an environmental focus. Directed and purposeful leadership from within is the precursor to any other action aimed toward combatting greenwashing.
Eliminate Vagueness, No Proof, and Hidden Trade-Offs in Green Marketing
One of the subtler forms of greenwashing is marketing with terms that lack weight or concrete meaning but still lead the consumer to believe that a product or company is environmentally friendly. Examples of such terms include ‘green’, ‘eco-friendly’, ‘natural’, ‘chemical-free’, and many more. Any green term that doesn’t convey the full story of a product can fall into this vagueness trap. Marketers must do away with these meaningless terms in favor of language that is more concrete and specific; sustainable language needs to be succinct and clearly defined. Packaging that is designed with nature or green imagery is another way marketers utilize vagueness to get consumers to associate their products with sustainability. Marketers should only use such imagery and package design for products that are truly sustainably sourced and have a minimal footprint.
Sustainable claims on products need to be backed up with easy-to-obtain information to further substantiate these claims. While there is only so much room to communicate on product packaging, links to sites with further information need to be included to make the information-gathering process simple and easy for consumers. On this front, there is a movement in product packaging that tells the full story. Within the fashion industry, some companies are beginning to provide more comprehensive labeling regarding the footprint of their clothing. They are doing this in a few different ways, from food-like labels to microchips that direct consumers to links showing the product’s path through the supply chain. Some companies are even providing sustainability ratings on each part of their supply chain. Comprehensive labeling such as this provides consumers with factual information on how sustainable a given product is and can remove the guesswork and vagueness of green marketing. We must reward such companies with our fealty and word of mouth recommendations.
Hidden trade-offs are a bit trickier to identify and combat. This ‘sin’ occurs when a company makes the claim that their “product is green based on a narrow set of attributes without attention to other important environmental issues.” A given product’s supply chain contains many different processes; just because one step of the process is sustainable doesn’t make the whole supply chain sustainable. Supply chain managers have a responsibility to communicate with their respective marketing teams and company as a whole as to how the entire supply chain affects the planet. Executives who are responsible for company-wide sustainability initiatives and issues must take a comprehensive approach to sustainability and make hidden trade-offs transparent, as one or a few sustainability initiatives do not make a company sustainable; the gestalt of their actions is what really matters.
Keep Internal Communication Flowing
Eliminating greenwashing at a business level doesn’t fall on any one individual or department, it must be achieved through the open flow of information within a company. It has been suggested that “firms with ineffective communication between marketing/PR departments and product development, production, or packaging departments are more likely to greenwash.” Ineffective communication regarding sustainability is a symptom of a lack of organizational purpose and focus on the issue, leading to a ripple effect throughout a given company. When marketing teams are not kept apprised of how products are brought to market, they will have a more difficult time being transparent in communicating with customers. Executives and managers should set up systems to promote the flow of information between those directly involved with production and those who communicate it.
Leverage the Power of External Stakeholders
While the greenwashing problem starts and ultimately ends at the business level, there are other actors at play in fighting this falsehood of sustainability. Consumers, NGOs, the media, and governments all play a role. Consumers should strive to be educated in what they buy and how it is sourced to the best of their ability. They should also consider refraining from purchasing from companies who have been caught deceiving customers about their environmental footprint. If companies won’t stop greenwashing for ethical reasons, financial reasons such as reduced revenues due to consumer boycotts will certainly make them reconsider. Companies also understand the importance of company reputation; negative media coverage on greenwashing actions puts a company at risk of harming its reputation. Individual investors can also play a role in the same way by refraining from investing in dishonest corporations. NGOs have done a great deal in identifying and spreading the word when greenwashing occurs; their action on this matter will continue to be important. Finally, governments must have a presence in regulating packaging and marketing messages to consumers regarding sustainability to ensure that companies tell the truth. Ending greenwashing will take a combination of these actors working towards integrity, transparency, and honesty in all aspects of business, to make the landscape more conducive to sustainable progress.
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Volume 2, Number 1. © CB Bhattacharya. All rights reserved. Research assistance for this blog was provided by Nathan Dobb.