# Greenwashing and Corporate Environmentalism

## The Elusive Green Customer

Sustainability sells. According to a survey of American consumers done by Boston Consulting Group, 75% viewed sustainability as ‘important’ or ‘very important’, with more than one third reporting that they have previously switched from their preferred brand to a more environmentally friendly alternative. This isn’t just an American trend –  the Nielsen Global survey on Corporate Social Responsibility (CSR) surveyed over 30,000 people from 60 countries, and found that 55% of online consumers are willing to pay more for goods and services from companies that show a commitment to creating a positive social and environmental impact.

However, what it means for a brand to be ‘sustainable’ or ‘environmentally friendly’ is far from clear. As Sarah Willersdorf (Global Head of Luxury at BCG) and Robbin Mitchell (Managing Director and Partner at BCG) point out in their article for The Business of Fashion,“Despite growing consumer demands for sustainable goods, it’s not always clear what consumers are actually demanding. Sustainability remains a nebulous concept that means different things to different people”. This ambiguity is exploitable, and has been by many big firms. It has allowed ‘greenwashing’ – defined as behaviour or activities that make people believe that a company is doing more to protect the environment than it really is- to flourish.

## The Origins and History of Greenwashing

The term greenwashing was coined by environmentalist Jay Westervelt in 1986, when he observed hotels placing placards in rooms promoting reuse of towels in order to ‘save the environment’. These same hotels otherwise made little to no effort to reduce energy waste, which led Westervelt to assert that the primary objectives of these campaigns was to increase profit, rather than to save the environment.

However, greenwashing was around decades before the practice had a name. In the 1960s, Westinghouse’s nuclear division was hit with the anti-nuclear movement that questioned the safety and environmental impact of nuclear power plants. In response, Westinghouse produced a number of adverts that asserted that nuclear power plants were “odorless […] neat, clean, and safe’. The most striking advert featured a photo of a nuclear power plant surrounded by a pristine lake. The claim that power plants are safe was dubious, considering that the advert appeared after nuclear meltdowns had already occurred in Idaho and Michigan. Furthermore, in 2016, a plant that used Westinghouse’s reactors – New York’s Indian Point – leaked radioactive material into the nearby area’s groundwater, which retrospectively points to the fact that nuclear power plants are neither ‘neat’ nor ‘clean’.

The tactic of using green imagery to persuade of a company’s sound green credentials was repeated by Sandoz in 1986, but this time as a damage control measure. After Sandoz became responsible for a chemical spill in Basel, Switzerland that turned the River Rhine red and killed plants, fish and wildlife for hundreds of miles, they released an advert that depicts a serene scene featuring a clean and tranquil pond, river and forest. The only environmental action they took in response to the spill was moving the majority of their production to Brazil.

Other companies used equally outrageous scenes, perhaps most comically, Dupont. In 1991, when announcing their new double-hulled oil tankers, they produced adverts featuring dolphins, penguins and seals clapping along to Beethoven’s Ode to Joy. During this same period, Dupont was named the single biggest corporate polluter in the US by non-profit Friends of The Earth’s report, ‘Hold The Applause’.

## Greenwashing Today

International advertising laws have somewhat tightened up since these cases; for example, EU laws require companies that market a product as green to prove that their overall environmental impact is less than their competitors. Nevertheless, greenwashing is still alive. Some modern cases are as explicit as cases from the past: in 2018, Starbucks responded to complaints about the environmental impact of straw use by producing a new strawless lid that contained more plastic by weight than the old lid and straw combined. Other cases, such as H&M’s Garment Collecting Programme, have become more subtle and sophisticated. H&M now places recycling bins in its many shops, with consumers who use them able to get a discount on their next product. While this initially seems like a genuine step in the right direction, it comes with multiple problems. The first is that only 2.2% of the materials from this programme were used to make new clothing, and 40% of the donated clothing gets thrown away. The second problem is that the reward for recycling old H&M products is a discount on new H&M purchases. As the primary environmental challenge fast fashion faces- H&M included- is the pure volume of products produced, all with their own negative environmental impacts, this is counterintuitive. However, it does increase H&M’s profit, which is why some critics of the programme have described it as ‘capitalism cloaked as consciousness’.

## How to Spot it- and Avoid it

While there may be debate surrounding what consumers are actually asking for, it is self-evident that they do not want to be greenwashed. The simplest way to avoid greenwashing is being able to identify it. In 2007, TerraChoice launched a study of environmental claims made on products carried on category leading big box store shelves. Based on the conclusions of this, they developed the Seven Sins of Greenwashing:

#### 1. Sin of the hidden trade-off

A claim suggesting that a product is green based on a narrow set of attributes without attention to other important environmental issues.

An example of this would be implying that jeans were sustainable because they were made from organic cotton. While this is important, it is only one step of the process. Cotton making is one of the most water heavy manufacturing processes, with Greenpeace estimating that it takes 7,000 litres of water to make a singular pair of jeans, from the production of the cotton to the delivery to the store.

#### 2. Sin of no proof

An environmental claim not substantiated by easily accessible supporting information or by a reliable third-party certification. Ancol Pet products exemplifies this type of greenwashing. They claimed that their biodegradable dog bags lessened dogs’ impacts on the environment.

When this was further researched, it was found that they were no more beneficial than standard bags, and the Advertising Standards Agency banned the advert on the basis that it was misleading.

#### 3. Sin of vagueness

A claim that is so poorly defined or broad that its real meaning is likely to be misunderstood by the consumer. All-natural is an example. Arsenic, uranium, mercury, and formaldehyde are all naturally occurring – and poisonous. All natural isn’t necessarily green.

A more specific example of this is H&M Conscious’ product description statements that make claims such as ‘made partly from recycled cotton’. Here ‘partly’ could mean less than 1% or almost 100%, and the environmental credentials of the product are left largely unexposed.

#### 4. Sin of worshiping false labels

A product that, through either words or images, gives the impression of third-party endorsement where no such endorsement exists; fake labels, in other words.

An example of this would be labelling a product as Fairtrade when it had not been certified by the Fairtrade Foundation.

#### 5. Sin of irrelevance

An environmental claim that may be truthful but is unimportant or unhelpful for consumers seeking environmentally preferable products.

Chevron used this tactic in the 1980’s when they produced a series of adverts showing Chevron employees protecting a variety of animals, from bears to butterflies. A lot of the environmental claims they boasted in these adverts were mandated by law, and so did not make them anymore environmentally preferable than their counterparts, and Chevron’s butterfly preserve was estimated to cost a mere 5000 dollars per year to run, while the adverts promoting it cost millions. #### 6. Sin of lesser of two evils A claim that may be true within the product category but that risks distracting the consumer from the greater environmental impacts of the category as a whole. Organic cigarettes or fuel-efficient sport-utility vehicles could be examples of this sin. #### 7. Sin of fibbing Environmental claims that are simply false. The most common examples are products falsely claiming to be ENERGY STAR® certified or registered. In 2015, Volkswagen succumbed to this tactic; they equipped 11 million vehicles with software that was used to cheat on emission tests. This meant that their emissions were much worse than they were reporting them to be (some vehicles were found to be emitting 40 times more toxic fumes than permitted). Watching out for these tactics is a smart way for consumers to protect themselves, though even with this guide some cases of greenwashing will undoubtedly go unnoticed. Consequently, many resources have emerged to check a brand or products green credentials, such as http://www.ecolabelindex.com, which provides a list of credible standards and labels, as well as EnviroMedia’s Greenwashing Index, which allows users to upload adverts and rank them from a scale of 1 to 5 on a greenwashing index. ## Corporate Environmentalism is Not Always Greenwashing With greenwashing being so commonplace, the danger, as stated by Ed Gillespie, Co-Founder of sustainability communications consultancy Futura, is that “we will end up dismissing all assertions of greenery – real and fake – with equal scepticism, so ‘undermine[ing] the nascent green market”. It is important to recognise that some brands are making genuine environmental efforts, and marketing themselves accordingly. In these cases, corporations are participating in green marketing as opposed to greenwashing. Patagonia – an American outdoor clothing company – proudly markets its environmental accomplishments, while still being transparent. They even go as far as discouraging people from buying their products, famously publishing an advert in the New York Times on Black Friday titled ‘DON’T BUY THIS JACKET’. They have admitted that they have not met all of their goals yet, but also make known the efforts they have made, such as: donating 1% of all sales to the preservation of the natural environment, repairing 58,000 garments to keep them in play, and making 72% of their line this season using recycled products. Patagonia also serves to show that genuine environmental efforts do not need to mean that the business suffers, as their revenue has quadrupled since 2014, under the CEO Rose Marcario (recently replaced by Ryan Gellert). Two more surprising corporations who are making legitimate steps to become more environmentally sound are FMCG brands Unilever and Mars. Both of these companies produce annual sustainability reports that summarise the respective brands’ performance in plain language, and admit where they are not doing so well (Unilever’s greenhouse gas consumption per consumer has increased, as has the land area associated with Mars’ value chain). Unilever’s report directly aligns their performance with the United Nations Sustainable Development goals- 17 goals set out by the UN that are “the blueprint to achieve a better and more sustainable future for all”. These goals cover a wide range of issues – from climate action and responsible consumption and production to gender equality and no hunger, so using them as a framework ensures that a broad picture of the company’s impact is being demonstrated. Mars has also invested1 billion in efforts to reduce its environmental impact. And Mars, as with Patagonia, will reap the economic benefits of their sustainable decision making; with the Barry Parkin, their chief procurement and sustainability officer stating in a phone interview that “there is a very concrete business case to this … we’re going to get a payback on that several times over”.

All three businesses also have clear, quantifiable and time bound targets. Patagonia has set four targets for 2025 (including becoming 100% carbon neutral across their supply chain), Unilever has set goals for 2020 and 2030 (halving the environmental footprint of the making and use of their products) and Mars has set their targets in two increments (2025 and 2050). This holds them accountable- both internally and to their consumers.

## Time for Change

Genuine efforts to make a corporation environmentally sound can increase profits, while simultaneously pleasing consumers. And with 2019 being the hottest year on record, there is no better time for corporations to step up and show that their commitment to the environment runs deeper than their advertising campaigns. As the Rewiring the Economy report from the University of Cambridge Institute for Sustainability Leadership (CISL) states, “Given the significant business opportunities and risks in the transition to a sustainable economy, this is no time for greenwash, complacency or ‘basic compliance’ approaches. Business is expected to lead.”

## Sources:

https://www.ul.com/insights/sins-greenwashing