Greenwashing, or allegations of it, has been a prominent issue throughout 2023. Regulations and standards have been implemented to prevent companies and financial institutions from falsely claiming to act in the best interests of people and the planet. However, there has also been an increase in accusations of wrongdoing.
The voluntary carbon market has faced significant scrutiny this year, with claims of integrity issues coming from various sources. Additionally, emerging concepts like Scope 4 emissions, which are “avoided” emissions reported by companies, have also been subject to criticism for their potential to enable greenwashing.
Green Hushing
Conversely, the phenomenon of “green hushing,” where organizations intentionally under-report or conceal their green or ESG credentials to avoid accusations of greenwashing, has grown in 2023 according to reports.
As legislation requiring thorough due diligence throughout company supply chains is introduced, businesses will face increasing pressure in 2024 and beyond to ensure their sustainability claims can withstand scrutiny.
What is Greenwashing?
Greenwashing is the practice of making false or exaggerated claims about the environmental benefits of a product or service. Companies do this to make themselves look environmentally responsible and appeal to consumers who are eco-conscious. For instance, a product may claim to be biodegradable when it actually takes years to degrade or can only do so under specific conditions. Or, a company may claim that its production process is sustainable when it’s actually damaging to the environment. These claims often mislead consumers and damage the cause of environmentalism.
Why Does it Matter?
Greenwashing matters because it undermines the efforts of companies that are genuinely trying to make a positive impact on the environment. It confuses consumers, making it hard for them to make informed decisions about products they buy. Moreover, greenwashing can damage a company’s reputation when consumers find out that the claims they made are false. It can also lead to legal action against companies that engage in false advertising. In short, greenwashing is harmful to everyone involved, including the company, the consumer, and the environment.
How to Avoid Greenwashing?
Here are some tips to avoid greenwashing:
- Look for certifications: Certifications from reputable organizations are a good indication that a product or service has undergone rigorous testing and meets high environmental standards.
- Do Your Research: Don’t just take a product’s claims at face value. Research the company’s environmental practices and check if their claims are verifiable.
- Look for Specifics: Be wary of vague claims like “eco-friendly” or “biodegradable”. These terms are not regulated and do not mean much. Look for specific claims such as “made from 100% recycled materials” or “reduces greenhouse gas emissions by 50%”.
- Find Alternatives: Consider choosing products or services with a smaller environmental footprint, such as those made from sustainable materials or those with a shorter supply chain.
Companies, on the other hand, should strive for transparency and honesty in their environmental claims and practices. Through honest and responsible practices by companies and informed choices by consumers, we can all work towards a more sustainable future.
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