New research shows a high prevalence of exaggerated or false environmental claims, but regulators are poised to fight back. David Burrows reports.
The impact of the food sector is firmly in the spotlight and this means companies are clamouring to tout their ‘greenness’. Net zero commitments. Recyclable packaging. Carbon footprints. Regenerative farming. Plant-based products. Animal welfare standards. Businesses certainly have plenty to go at, but some will be looking to cut corners. “Greenwashing is going to be a big MSc dissertation topic this year,” quipped Circuthon Consulting’s Paul Foulkes-Arellano on LinkedIn recently.
But regulators appear wise to the shift. Last month we were treated to not one but two international ‘sweeps’ of company websites designed specifically to pick up on greenwashing. The spies, from the European Commission and Competition and Markets Authority (CMA), found evidence of vague terminology, lack of evidence to back up claims and deceptive marketing that falls foul of consumer law.
Are we surprised? Probably not. Consumer appetite for greener products feeds greenwash – and always has. But in the wake of the pandemic is the pressure to appear green greater than ever?
According to an IpsosMori survey of 33,000 global consumers, 80% think we are heading for environmental disaster unless we change our habits. “People want brands to help them on a day-to-day basis by adapting products and services as well as communicating how they will work with them for a better future moving forward,” the pollster noted in its report, ‘Climate change and coronavirus’.
It’s not only public pressure that feeds the greenwash beast, though. In their 2011 paper, The Drivers of Greenwashing, US academics Magali Delmas and Vanessa Burbano said that as well as market pressure there were non-market drivers: internal pressure, through for instance incentive schemes skewed towards financial performance, can play a part; decisions made “in isolation” can also result in dubious actions and claims, with the trail often leading back to marketing teams.
“Sustainability is not suited to a symbolic-interpretive PR approach,” a friend recently wrote in a paper on the topic, “it should be about doing, not looking like you’re doing.” And yet there is plenty of evidence that marketers are so mad for green points that they’re happy to bend the rules.
Consider a press release from a cereal maker recently that boasted of new cereal pouches “free from single-use plastic”: they are actually made of PE (polyethylene) and LDPE (low-density polyethylene), but the line being spun is that these are recyclable and therefore not single-use. Or the revelation in a recent Footprint report, that marketing teams are exerting pressure on catering clients to invest in perceived “sustainable” packaging options.
Such greenwashing could of course be the result of ignorance rather than intent (climate incompetence runs right up to board level according to recent research). Indeed, many companies have limited tools to assess what is and isn’t greenwash (though some know full well) given the ambiguity (and in some cases oversight) of the regulatory regimes in place. A “lax and uncertain regulatory environment” was another of the drivers for greenwash identified by Delmas and Burbano.
They also noted that “decision makers may over-estimate the likelihood of the positive results of greenwashing, namely, gaining green market share and attracting capital from [socially responsible] investors, and under-estimate the likelihood of negative events resulting from greenwashing such as being caught”.
There have of course been high profile cases of greenwashing but policing of it has by and large been left up to consumers and NGOs. Until now. Both the European Commission and in the UK the CMA are threatening to take action. “The commission is fully committed to empowering consumers in the green transition and fighting greenwashing,” said Didier Reynders, commissioner for justice, last week.
The commission has just completed a sweep of international websites – and for the first time it honed in on greenwashing. In 42% of cases, claims were found to be exaggerated, false or deceptive, and could therefore potentially amount to an unfair commercial practice under the Unfair Commercial Practices Directive. For 59% of the cases the evidence to back claims up was difficult to find; 37% used vague terms.
The CMA and the International Consumer Protection and Enforcement Network (ICPEN) have also done a sweep as part of a new work stream on greenwashing announced just before Christmas. “Our role is to make sure that consumers can trust the claims they see on products for sale and don’t fork out extra for items falsely presented as eco-friendly,” said CMA chief executive Andrea Coscelli.
The CMA has insisted this isn’t about “bashing business”, Cecilia Parker Aranha, who is leading the work, told me recently. It’s about ensuring brands are not “taking advantage of people by slapping on a quick label or claim which might mislead them”.
The new sweep of websites selling products and services suggest Aranha and her team have their work cut out. Four in 10 of the 495 websites they looked at “appeared to be using tactics that could be considered misleading and therefore potentially break consumer law”. Vague claims such as ‘eco’, ‘natural’ and ‘sustainably sourced’ – red flags for the greenwash wary – were rife. (One of my favourites in this category, albeit not part of this sweep, remains Tesco’s use of the phrase ‘farm grown’ on packs of sultanas).
The CMA is also wary of firms policing their own eco standards with in-house labels and logos that are not subjected to any third party scrutiny. Other sites it assessed were apparently hiding or omitting information to “appear more eco-friendly”. Indeed, the value in the regulator’s work will not just be in spotting what’s there, but what’s not – and even what should be (it’ll be interesting whether the CMA reckons carbon labels are needed to help people make sustainable choices).
Has greenwashing increased? That we don’t yet know but with heightened interest in sustainable choices and awareness of climate risks it’s a fair bet to say if it hasn’t already, it will this year. Companies that are tempted to fudge their claims should note the concluding remarks from a recent study in the Journal of Business and Technical Communication: that half-lies had similar negative effects on reputation as lies and “only true green behaviour will have the desired positive effects on reputation”.