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Elevate Magazine
May 3, 2024

Your Business Might Be Greenwashing and Not Even Know It

greenwashing

The rising awareness of climate change and other environmental issues has pushed companies to prioritise the promotion of their sustainability efforts to gain customer attention. While this can be a good thing, some companies merely present a surface level of sustainability while continuing to adopt practices that contribute to increased waste or greenhouse gas emissions.

This has led to claims of “greenwashing.”

What is Greenwashing?

Greenwashing, also known as green sheen, is a form of false advertising or green marketing spin in which a company spends more time and budget presenting itself as a sustainable business, with its products, goals, and policies as being eco-friendly, than actually minimising its carbon footprint.

The term greenwashing was coined by environmentalist Jay Westerveld in his 1986 essay based on the irony of the “Save the Towel’ movement in hotels during that time. The “Save the Towel” initiative refers to the efforts by hotels to encourage guests to reuse their towels during their stay rather than having them washed after each use. Westerveld said that while hotels were claiming to be saving water, they were also simply trying to reduce costs by not having to wash towels as much.

Why Do Companies Greenwash?

The answer seems a little straightforward: being perceived as ethical increases profitability. A report from Nielsen’s Global Corporate Sustainability has found that 73% of millennials would willingly spend more on sustainable offerings. Research from McKinsey has also revealed that Gen Zs are more likely to purchase goods from brands that are known to be ethical. These statistics demonstrate that companies can clearly gain a financial aadvantage by adopting a more socially and environmentally conscious stance, or at least appear to. 

Another reason that companies may be guilty of greenwashing could be that they simply don’t know that they’re doing it. So, how do you know if you’re greenwashing? 

Signs Your Business Might Be Greenwashing

  • You use fluffy words like ‘eco-friendly’, ‘green’, or ‘natural’ in your marketing strategy and advertising campaigns without a clear idea of exactly how you are achieving that status.
  • If your business promotes environmentally friendly products or initiatives while simultaneously engaging in environmentally harmful practices in your supply chain and elsewhere in your operations. 
  • You’ve been promoting your business’s corporate social responsibility for an extended period, but it shows little to no measurable improvement in its performance. 
  • Your sustainability claims lack specific details, transparency, third-party certification, or evidence to support them.

Examples of Greenwashing

Coca-Cola

Coca-Cola faced a lawsuit for advertising its sustainable practices and campaigning for a “World Without Waste.” Meanwhile, the soft drink company continues to be the top contributor to plastic pollution and has not committed to phasing out plastic bottles.

McDonald’s 

The fast food company opened its first net-zero branch in 2021. Critics argue that this initiative diverted attention from the chain’s primary menu offerings, which remain environmentally harmful: mass-produced meat and dairy products. 

IKEA

IKEA launched a sustainability initiative to phase out single-use plastics in 2020 and eliminate plastics from its packaging by 2028. However, in 2021, the non-profit organisation Earthsight released a report suggesting that IKEA sold wood illegally sourced from Russia. 

As consumer demand for sustainability continues to rise, showcasing your organisation’s initiatives becomes increasingly appealing. However, it’s crucial to proceed cautiously to prevent the risk of facing backlash and accusations of greenwashing.