Greenwashing – Companies Are Misleading Consumers for Profit

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The color green, leaves, and unverifiable terms such as eco-friendly and conscious: sometimes greenwashing is as simple as that, the right imagery and vague but terribly effective words. Other times, greenwashing consists of figuratively burying labor rights violations and gender-based violence under a thin layer of “sustainable” initiatives and green collections consisting of organic cotton pieces sawn by garment workers who aren’t being paid enough to meet their basic needs. Either way, greenwashing is a threat to consumers, the planet, and the small ethical and sustainable companies that struggle to stay afloat in an economic system that favors and rewards unethical practices. This article will explore the market reasons behind greenwashing, give some concrete examples, and point out which elements you should be looking for when trying to distinguish between actual ethical business practices and corporate greenwashing. 

THE MARKET OFFERS WHAT THE CONSUMERS WANT (SORT OF)

Greenwashing is a neologism that describes activities carried out by companies and organizations designed to make the general public and potential consumers aware that it is engaging in environmentally sound practices when its actual business conduct harms the planet. The term was coined in 1986 by American environmentalist and researcher Jay Westerveld. Since the mid-eighties, mass media have multiplied, giving companies even more marketing channels to spread their false message. 

The reason behind this behavior is companies’ desire to falsely cater towards consumers’ demands for profit. Research shows that a green facade can be profitable: a poll conducted by the data and market measurement firm Nielsen showed that 66% of global respondents were willing to pay more for sustainable products, and more than half of them were influenced by key sustainability factors. The 2020 Zeno Strength of Purpose Study, commissioned by Zeno Group, highlighted that 94% of the surveyed global consumers said that it is important to them that the businesses they engage with have a strong purpose, and 83% of them also believed that companies should earn a profit only if they are delivering a positive impact. 

Amid the pandemic, this trend is not projected to die down. In its “The State of Fashion 2021” report, the management consulting firm McKinsey & Company has reported that the Covid-19 pandemic has only amplified the public’s awareness of the social injustices taking place in the supply chain with consumers becoming more aware of the conditions of the vulnerable employees working along the fashion value chain. 

WHAT GREENWASHING LOOKS LIKE

To seemingly appease consumers’ demands, big brands have developed a set of strategies meant to substitute real change with smoke and mirrors. 

In August 2019, The Norwegian Consumer Authority (CA) had called out the Scandinavian fashion brand H&M, which is part of the even larger fashion company that includes the brands Monki, Weekday, Cheap Monday, COS, & Other Stories, and ARKET, for providing insufficient information regarding the actual sustainability of its Conscious Collections which the company advertised as lines with environmental benefits. Despite committing in 2013 to paying its 850,000 workers a living wage by 2018, in 2019, according to the Clean Clothes Campaign (CCC), not a single one of their workers was making a living wage. 

In January 2020, The Italian Competition Authority imposed a fine of 5 million Euro on the Italian multinational oil and gas company Eni for misleading business practices regarding the ENIdiesel+ ad, which presented a highly unsustainable diesel made of crude palm oil as “green.” 

WHAT TO BE ON THE LOOKOUT FOR

As businesses invest time and resources into crafting the right marketing strategies to purposefully mislead potential customers, knowing what the red flags look like can help consumers avoid funding brands whose set of values, or lack thereof, doesn’t match their own.  

The over-use of nature-related imagery is a classic greenwashing tactic, just as a lack of transparency and an abundance of vague buzzwords. Truly sustainable brands don’t have anything to hide and won’t have an issue disclosing where, how, with what material, and by who their products were made. Certifications such as GOTS, STANDARD 100 by OEKO-TEX, Fair Trade, and FSC can be immensely helpful when trying to purchase sustainable products. In general, if possible, it’s always better to support small businesses, especially the ones owned by people from marginalized communities, and avoid large brands.  

With the world’s largest fashion brands scoring an average of just 23% in the Fashion Transparency Index 2021, it is clear that major brands have a lot of work to do to be worthy of people’s trust.