Greenwashing undermines sustainable economy

Back in 2010 in US and Canada 4,744 products were tested and 95% of them were guilty of greenwashing (misrepresentation in terms of environmental quality). This demonstrates that as consumers we are massively mislead and manipulated by producers, who know that we are gradually starting to care about the environment – while too many producers still care primarily about their profits.

In order to make progress in environmental sustainability we undoubtedly have to face the factual situation, recognize its seriousness, and accept the urgency of action. It is a question of common sense, and even the rule of law is undermined: a small misrepresentation by an individual is punishable, while a systematic misrepresentation of a corporation is being tolerated!

Because it is more directly related to human health and even life, no misrepresentation is tolerated with medicinal products, but already when it comes to food additives – a lot is tolerated. Generally, the “eco-friendly” label (lacking a precise definition) is following us daily, while the environment continues to be under severe pressure. This problem applies to everybody: from governments (who should adopt appropriate measures, mandatory standards and much more rigorously control their actual implementation), to the business sector (who should accept the fact that disrespecting environmental requirements may save them some costs in the short run, shifting them onto consumers and society, but will soon endanger their position at the market), to NGOs (who should be much more aggressive and consistent in their pressure on authorities and business), and finally to the general public and consumers (who should refuse ecologically unacceptable products and packaging).

As we often emphasize in KEN publications, the academic community also remains too modestly involved in public discourse. It should present the undisputable research results and allowing the public to benefit from their qualified interpretation, which could not be ignored by any responsible stakeholder, least by the responsible authorities.

What is greenwashing?

Cambridge Dictionary says greenwashing is designed “to make people believe that your company is doing more to protect the environment than it really is.” While greenwashing is not new, its use has increased over recent years to meet consumer demand for environmentally friendly goods and services. Whilst some greenwashing is unintentional and results from a lack of knowledge about what sustainability truly is, it is often intentionally carried out through a wide range of marketing and PR tricks and misrepresentation. But the common denominator among all greenwashing is that it is not only misleading, but it’s also really not helping to further sustainable design or circular economy initiatives, according to Leyla Acaroglu, UNEP Champion of the Earth, Designer, Sociologist, Sustainability Provocateur.

The term greenwashing was coined by New York environmentalist Jay Westervelt already back in 1986 in an essay regarding the hotel industry's the practice of placing placards in each room promoting reuse of towels ostensibly to "save the environment." Westervelt noted in most cases, little or no effort toward reducing energy waste was being made by these institutions. Westervelt claimed that the actual objective of this "green campaign" on the part of many hoteliers was, in fact, increased profit.

In 2007 Terra Choice Marketing came up with the Six Sins of Greenwashing, which classifies the many ways through which companies participate in greenwashing:

sin of the Hidden Trade-off: committed by suggesting a product is "green" based on an unreasonably narrow set of attributes without attention to other important environmental issues;
sin of No Proof: committed by an environmental claim that cannot be substantiated by easily accessible supporting information or by a reliable third-party certification;
sin of Vagueness: committed by every claim that is so poorly defined or broad that its real meaning is likely to be misunderstood by the consumer;
sin of Irrelevance: committed by making an environmental claim that may be truthful but which is unimportant or unhelpful for consumers seeking environmentally preferable products;
sin of Lesser of Two Evils: committed by claims that may be true within the product category, but that risk distracting consumers from the greater environmental impact of the category as a whole;
sin of Fibbing: the least frequent Sin, is committed by making environmental claims that are simply false.

“Greenwashing is all about misdirection, showing one thing that distracts you from what is really going on. The main issue we see is that greenwashing takes up valuable space in the fight against significant environmental issues like climate change, plastic ocean pollutions, air pollution and global species extinctions. The saddest thing is that many companies do it by accident, as they don’t have the expertise to know what is truly environmentally beneficial, and what is not,” wrote Leyla Acaroglu.

Examples

Not isolated, but definitely the biggest greenwashing scandal so far is that of Volkswagen, discovered in 2015, which has admitted misrepresented emission tests by fitting into 11 million vehicles a proprietary software that could detect when it was undergoing an emissions testing, altering the performance to reduce the emissions level, all while touting the low-emissions features of its vehicles through marketing campaigns. In truth, however, these engines were emitting up to 40x the allowed limit for nitrogen oxide pollutants.

And that was already the second time Volkswagen was caught red-handed in US – the first time it was in 1973.

To what extent the German government is powerless vis-à-vis the automobile industry has been manifested by the fact that practically nothing has been done to punish this unacceptable massive manipulation, paid only by the consumers. Ironically, thanks to Environment Protection Agency, only American buyers were compensated, while all others remained unprotected, and left to the option of individual lawsuits.

The quoted VW case resembles a 1998 case involving seven manufacturers of heavy-duty truck engines: Caterpillar, Cummins, Detroit Diesel, Mack Trucks, Navistar International Transportation, Renault Véhicules Industriels, and Volvo Trucks. These companies agreed to spend more than $1bn, including $83.4m in penalties, to settle the case – the biggest civil fine at that point for violating an environmental law. Attorney General Janet Reno cautioned the industry that “an ounce of compliance is worth a pound of penalties”.

Here are further examples of companies that have been accused of not being as environmentally friendly as marketed:

Blueland (‘100% recyclable’ cleaning products)
Quorn Foods (carbon footprint claims)
Tide purclean (‘plant-based’ laundry detergent)
Windex and other household cleaners (‘non-toxic’)
GreenPan (‘green’ cookware)
Nestle (‘sustainably sourced cocoa beans’)
Nest Labs (programmable thermostats)
Kauai Coffee (compostable coffee pods)
Charmin Freshmates (flushable wipes)
Rainforest Alliance (Chiquita bananas, coffee, tea, etc.)
Reynolds American (Natural American Spirit cigarettes)
AJM Packaging Corporation (paper plates)
LEI Electronics (carbon neutral batteries)
SeaWorld (killer whale shows)

One of the most pervasive examples of greenwashing is in the world of single-use plastic. This alarming issue about plastic drove the “Truth in Advertising Organisation” to create a free Post-Disposable Activation Kit, and it’s why they talk so much about the dangerous idea that recycling will solve all the problems, when in fact the main issue is that we have normalized disposability to the point where everything is valueless. And not only is recycling a bit of environmental folklore, but so are many of the bioplastics being marketed as sustainable design solutions. Leyla Acaroglu wrote: “Bioplastics are plastics made from bio-based polymers that are engineered to perform like normal petrochemical plastics. In nearly every case, they need a certain set of conditions to break down in (oxygen and sunlight that aren’t present in a landfill or the ocean, for example). Further to end of life management issues, they also require a certain amount of petrochemicals in their production phase so often have a similar amount of ‘plastic products’ embedded within them. Additionally, since plastic bags take a lot of energy and other resources to manufacture in the first place, a “friendlier” plastic is not helpful at all when using life-cycle thinking. The FTC began cracking down on the misleading claims of bioplastic manufacturers in 2013 and handed out more warnings to marketers in 2014.”

The weak regulations

The problem of Greenwashing is compounded by lax enforcement by regulatory agencies such as the Federal Trade Commission in the United States, the Competition Bureau in Canada, and the Committee of Advertising Practice, and the Broadcast Committee of Advertising Practice in the United Kingdom:

Australia: The Australian Trade Practices Act has been modified to include punishment of companies that provide misleading environmental claims;
Canada: Canada's Competition Bureau, along with the Canadian Standards Association are discouraging companies from making "vague claims" towards their products' environmental impact. Any claims must be backed up by "readily available data;"
European Union: The European Anti-Fraud Office (OLAF) also handles investigations that have an environment or sustainability element, such as misspending of EU funds intended for green products and the counterfeiting and smuggling of products with the potential to harm the environment and health;
Norway: Norway's consumer ombudsman has targeted automakers who claim that their cars are "green," "clean" or "environmentally friendly" with some of the world's strictest advertising guidelines;
U.S.A.: The Federal Trade Commission (FTC) provides voluntary guidelines for environmental marketing claims. These guidelines give the FTC the right to prosecute false and misleading advertisement claims. The green guidelines were not created to be used as an enforceable guideline but instead were intended to be followed voluntarily.

This short presentation of very weak regulatory mechanisms shows why the practice of greenwashing is so widespread around the globe.

At the end, it is important to be able to identify instances of greenwashing, and replace them with truly sustainable practices.

Closing thoughts

Nowadays the pollution prevention is being emphasized increasingly, and the general level of awareness is growing, though not quickly enough. But prevention is not enough. We need to move towards a circular economy with closed-loop systems, where by-products are reused, wastes become raw materials, water is recycled, and energy is recovered from waste energy. Understanding the causes and consequences of environmental pollution enables us to realize that humanity holds the tools to confront these daunting issues. We have the necessary knowledge and technology, but is the determination strong enough to meet all the obstacles?

What are the prospects to fight greenwashing and thereby contribute towards a more sustainable economy and the eco-friendly environment? There are still serious obstacles to be addressed. The consumers are insufficiently informed, and generally unaware of the price they are paying for their passivity. Unfortunately, most governments look the other way - are they really so powerless against the corporate lobbies? And the NGOs are often too weak to make a decisive difference. Disappointingly, the academia stays too much concerned just with the research, and as a consequence of all these factors, we are experiencing much more greenwashing than imaginable for the 21^st century (characterised by advanced ICT and rapidly growing AI).

In the short run, the most effective pressure can come from regulations and standards being applied consistently and energetically. Political parties fighting for the electorate could benefit from placing this problem on their agendas, and when elected, actually do what they have promised. In order for this to happen, the electorate should be monitoring what is actually achieved, and interact with NGOs, and academia to continue pushing the government to act.

As in other areas of anti-social behaviour, observing the new regulations and the attitude of a new government, many companies will start behaving much more “eco-friendly”, partly in order to avoid sanctions, and partly because the markets will increasingly reward such producers through better sales and stronger market shares – which brings better profits. But this time, it will be because the producers have followed the genuine preferences of the consumers.

(Prepared by the KEN Secretariat: prof. dr. Ajda Fošner and prof. dr. Boris Cizelj).