Editor’s note: This is the first of two articles published concerning greenwashing, both historically and at present. This week’s article examines the practice and its history. The second article can be seen here.
What is Greenwashing and How does It Work?
Greenwashing is a marketing strategy for companies and brands to generate Green PR by deceptively convincing the public that their goals and policies are environmentally friendly and therefore better at achieving ecological benefits. Products are greenwashed through the process of renaming, rebranding or repacking. Greenwashed products may convey the implicit idea that they are more natural, healthier or do not contain chemicals than competing brands. Common examples can be found in food products, alternative medicine and natural medicine marketing, as well as the ‘sustainable’ fashion industry.
To some, this may sound like good news. However, what needs to be considered is if companies claiming initiatives to reduce their carbon footprints are really doing so, or if the underlying reasons are simply pretentiousness and avarice.
Greenwashing, also known as ‘’green sheen’,’ was introduced to take advantage of today’s increasing demand for environmentally friendly products. Although these products create the image that they waste less natural resources and have a more sensitive approach to the environment, this is, in reality, an attempt to benefit from demand. More recently, some of the world’s largest carbon emitters, such as traditional energy companies, have tried rebranding themselves as environmental champions.
Where Did It Come From?
The term originated in the 1980s after American environmentalist Jay Westervelt stated that there were signs in a hotel he visited, asking guests to reuse their towels to “save the environment.” Westervelt evaluated the enormous amount of waste he encountered in the rest of the hotel, where no obvious sustainability efforts were made. Instead, he concluded that the hotel was trying to cut costs by not having to wash the towels too much, but trying to market this cost-cutting trick as eco-friendly behavior.
Large scale greenwashing companies have made headlines over the years. For example, in the mid-1980s oil company Chevron commissioned a series of expensive television and print ads to broadcast its supposed commitment to the environment. But with the now infamous “The People Do” campaign going on, Chevron was actively violating the Clean Air Act and the Clean Water Act, as well as spilling oil into wildlife shelters.
Unfortunately, Chevron wasn’t the only company making outrageous claims. In 1991, chemical company DuPont introduced double hull oil tankers with advertisements featuring marine animals bouncing in chorus to Beethoven’s song “Ode to Joy.” The company turned out to be the largest corporate polluter in the U.S. that year.
Examples of Greenwashing
The U.S. Federal Trade Commission (FTC) provides several greenwashing illustrations detailing its voluntary guidelines for misleading green marketing claims, along with practices that can be considered greenwashing:
- Plastic packaging containing a new shower curtain is labeled “recyclable.” It is unclear whether the package or shower curtain is recyclable. In both cases, the label is deceptive if any part or contents of the package other than minor components cannot be recycled.
- An area rug is labeled as “50% more recycled content than before.” The manufacturer has increased the recycled content from 2% to 3%. While technically correct, the message gives the false impression that the carpet contains a significant amount of recycled fiber.
- Garbage bags are labeled “recyclable.” Garbage bags are generally not separate from other garbage in the landfill or incinerator, so they are unlikely to be reused for any purpose. The claim is misleading as it provides an environmental benefit where there is no significant benefit.
Why Companies Greenwash & How it Harms a Brand’s Reputation
Greenwashing is mostly involved in profit-oriented actions. While advertising regulators exist, there is no universally accepted definition of what terms like “sustainable” actually mean. This means big brands can market an item as “green,” often with a significant price increase, without sticking to a clear definition of the term.
This is happening more and more because being socially conscious is popular right now and brings more profit to brands. McKinsey found that Gen Z (the demographic cohort born between 1995 and 2010) are more likely to spend money on companies and brands that appear to be ethical. Generation Z is also more prepared to open their wallets than previous generations for a brand that promotes causes related to social causes like climate policy or social justice issues. This may be because Generation Z is the first true digital generation, having lived through a groundbreaking time period, as well as a transition generation largely unaware of life before technological developments. This generation has ‘woken up’ positively or negatively to the world around them.
Gen Z consumers are mostly well educated about brands and the truth behind them. Even if they are not, they know how to access information and often quickly develop views based on that information. For example, if a brand advertises diversity, but there is no variety in their ranks, this contradiction will be noticed. This gives these consumers unprecedented power to shape the success or downfall of companies, who in turn are increasingly conscious of the concerned issues. And Gen Z knows that they can drive this institutional change.
Greenwashing has changed in the last 20 years, but it still continues. As the world embraces greener practices, corporate actors are faced with a series of lawsuits for misleading environmental claims.
In February 2017, Walmart paid $ 1 million to resolve greenwashing claims that the country’s largest retailer was mistakenly selling environmentally-conscious plastic. California law prohibits the sale of plastics labeled as “compostable” or “biodegradable” because environmental authorities have determined that such claims are misleading if they don’t include a disclaimer of how quickly the product will biodegrade in the landfill.
It’s easy to understand why marketers are enthusiastic: According to Nielsen’s Global Corporate Sustainability Report, 66% of consumers spend more on a product if the product comes from a sustainable brand, and this figure spikes to 73% among millennials.
Image courtesy of Flickr. Originally published by S&S on Jan. 27, 2021.