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11 May 2021

What is greenwashing and how can businesses steer clear?

Luke Baker

We’ve all heard the term Greenwashing before. First coined by environmentalist Jay Westerveld in 1986, after visiting Hawaii and being struck by a sign in a hotel he’d snuck into to steal a towel which said to please reuse your towels. Whilst this was going on the hotel business was expanding across the island with very little thought for the ecological effect it was having.

About two years later he remembered the sign again and the phrase came to him; “out with the greenwash”. He ended up writing an article about it and from there the phrase took off, initially in New York and then further afield.

Around about the same time Chevron was putting together advertisements like this (it’s worth a watch), whilst the company violated the clean air act, the clean water act and spilt oil into wildlife refuges. One commentator also observed that the advert likely cost around $200,000 but the butterfly sanctuary they funded was around $5,000 per year.

And there are countless other examples, from bottled water giants and their affinity for rugged mountains and waterfalls whilst only 31% of the bottles actually get recycled in the U.S. To McDonald’s and their move from plastic straws to paper ones, that also couldn’t be recycled and were just a fraction of their impact with their beef making up 29 per cent of their footprint. The backlash on this one from the press was significant!

But how can a company avoid greenwashing and the reputational risks that come with it? Here are some top tips:

1) Be fully transparent in your commitments

In an information-rich world, hiding details will not sit well with your customers or investors and bring cynicism and suspicion. It’s great to have big achievements, but everyone knows that all companies are a long way behind where they need to be. So make sure you let people know where you are falling down also.

The tech companies have a simpler job than the complex supply chains of food and beverage companies, but what they do very well is show the numbers. Microsoft shows detailed projections around their carbon footprint targets and how they are going to get there. Of course, there’s also a beautiful advert but their rigour in calculations shows a business that is serious.

2) Collect real credentials

Trust in business has taken a beating over the years, with the latest Edelman Trust score putting business at a 55 score out of 90. By allowing third parties to come in and validate your claims it really boosts credibility. Whether it's becoming a B-Corp or setting validated goals within the Science-based target's initiative, these are credible ways to show you are serious about being a responsible business. They also have the added bonus of allowing you to be part of a community going through the same transition; all learning from each other along the way.

3) Convince yourselves before you convince anyone else

True sustainability doesn’t start in the marketing department. It starts with firm commitments from senior management and buy-in from across your workforce. It’s likely to start with an acceptance that you are starting a journey and that things are far from perfect. If you can convince your staff of your actions, the chances are it’s time to start telling the outside world.

Overall, greenwashing is the domain of companies that have something to hide. Providing you as a business owner are honest about how your company is impacting the planet and how you are going to reduce any negative impact to zero, you’ll steer clear of criticism.

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