Green-washing refers to when an organisation has communicated an environmentally positive goal, policy, message or commitment, without the capacity to demonstrate or prove that it is effecting positive change towards the environment. For organisations, this is sometimes used as a marketing gimmick, but when they are asked to prove their promises, they lack the objective evidence needed to stand up to stakeholders and broader industry scrutiny, which then results in such organisations being called out for green-washing.
Marketers play with the psyche of the consumers by convincing them to believe in the eco-friendliness of their products and the brand. This helps in creating a positive perception, resulting in increased profit and goodwill of the company.
Green-washing has become a growing concern across industries; and there are several drivers behind the urgent need to tackle it. There are industries responding to stakeholder pressure to invest in more sustainable practices and divest themselves from unsustainable industries;
some succumb to consumer pressure for greater levels of trust and transparency from organisations regarding the environmental impact of the goods and services they purchase, while others want to adjust to the ever-modifying regulatory landscape for better environmental practices and controls.
Businesses can be recognized, if they are guilty of green-washing, by keeping a watch on some of the signs, such as:
• promoting new green initiatives that have little impact on the overall environmental footprint of the business;
• highlighting the green changes, while neglecting their negative effects;
• offering no proof for the eco-friendly claims made by the companies; and/or
• using the technique of selectively disclosing the positive environmental facts about the products.
The pressure on organisations to reduce their impacts on the environment is now greater, and it will increase, going forward, whether it is financial, consumer-driven or legally enforced.
According to a survey published in 2020 by the International Organization for Standardization (ISO), only a minuscule 0.2 per cent of the 417,478 global organisations from every industry sector currently use ISO 14001, the globally recognised environmental risk management standard, to manage and improve their organisation’s impact on the environment.
The practice of unethically claiming to be good towards the environment can be seen across sectors. The beauty and fashion industry top the list -- driving high on green-washing. Brands in this industry claim to be eco-friendly, organic, recyclable, or sustainable but, if observed closely, they have no real measures or certificates to prove that they are genuinely delivering what they are claiming.
Some recommendations for companies to avoid green-washing are:
• be transparent;
• be ethical, which pays in the long term;
• communicate significant environmental achievements in a correct and clear manner;
• be honest towards the stakeholders at all times;
• take responsibility for the negative impacts of your business on the environment and work towards rectifying them, if any;
• opt for a lifecycle assessment and analyse the environmental impact of all the products over the entire life cycle; and
• back up all the green claims with relevant certifications.
Marketers play with the psyche of the consumers by convincing them to believe in the eco-friendliness of their products and the brand. This helps in creating a positive perception, resulting in increased profit and goodwill of the company
SEBI, India’s capital market watchdog has proposed tighter environmental, social and governance rules, as it seeks to minimise the risk of green-washing and misuse of ratings by companies. Due to the increased focus of investors and stakeholders seeking businesses to be responsible and sustainable, it has become as important as reporting on financial and operational performance.
There is an urgent need for organisations to empower their people, from the frontlines to the marketing team, by using these globally recognised how-to guides, in the form of various ISO standards, to align their organisations with a clear and systematic approach to effecting positive change.
No matter which area of environmental sustainability the focus is on, the essential foundation begins by using ISO 14001 to manage and improve site risks and impacts. Guides, regulations and standards provide the organisation, as also any interested parties, with independently validated and verified objective evidence to prove their promise as a trusted and responsible environmental steward. This verified evidence enables your teams to go to market in a trusted and transparent way, without the need to green-wash.