What is greenwashing (and how can you spot it)?
Posted on: 24 April, 2024
What are the different ways businesses attempt to remarket and camouflage their environmentally damaging products and operations?
With concerns around the ongoing climate crisis growing and new legislation being set by governments across the globe, it’s not surprising that more and more businesses are talking about sustainability. Corporations are one of the biggest contributors of greenhouse gas emissions – just under a fifth of the UK’s total emissions come from commercial activity. The built environment is no stranger to this either, with our sector responsible for 39% of global energy related to carbon emissions.
But while many companies have gone to great lengths to decarbonise their operations, not all businesses and industries have shown the same commitment. Many have taken to greenwashing – in fact, a 2020 Competition and Markets Authority (CMA) review found that 40% of green claims online ‘could be misleading’ to customers.
So what exactly is greenwashing, and how does it happen in the built environment?
What is greenwashing?
Greenwashing is where an organisation makes vague, misleading or even false claims about their product or operations and their subsequent environmental impact. While this concept has been around since the 1960s, it’s gained prominence in recent years amid greater demand for sustainable products from customers and increased pressure and legislation from governments.
Today, false advertising around sustainability is rife, with the CMA particular emphasis on the construction sector and its ‘questionable’ net zero carbon claims. What’s more, the Climate Change Committee criticised the UK government over policies around energy efficiency and agriculture in a 600-page report, claiming the country is set to miss its flagship net-zero target.
How greenwashing works
Greenwashing can take various forms, but most often occurs when an organisation or individual attempts to market or advertise their products or services. In the context of the built environment, a construction company could be fitting their buildings with solar panels in an attempt draw attention from the environmentally damaging nature of their production. Similarly, it can be a case of adding a ‘green’ label to a man-made structure doing significant harm to the planet, as when Grimshaw won an award for the ‘greenest airport in India’.
Why do so many businesses greenwash?
In a 2022 survey of almost 1,500 CEOs and C-Suite leaders, well over half (58%) admitted their companies were guilty of greenwashing, and two-thirds questioned whether their efforts were genuine in the first place.
Being sustainable is important to modern consumers – according to a McKinsey survey, over 60% of respondents would pay more for a product with sustainable packaging, while a study by NielsenIQ found that 78% of US consumers believe a sustainable lifestyle is important to them.
However, being truly ‘sustainable’ is far from easy. A staggering 98% of sustainability initiatives fail to meet their objectives, according to research by Bain & Company, while research by Software AG found that 82% of the 2,000 decision makers it surveyed would rather accept regulatory fines than launch an initiative in the first place.
Greenwashing has become so common and widespread because many businesses would rather risk paying the price than undertake complex sustainability programmes that lead to organisational change. Yet with so much emphasis placed on businesses and employers that care about the environment, they’re willing to take shortcuts to realise the commercial benefits of sustainability.
Learn more: Making a business case for sustainability: why now is the time to act
How does greenwashing impact businesses and the environment?
Brands that partake in greenwashing may believe that they’re contributing to the greater good when they adopt green messaging, but the truth is they’re doing far more harm than they realise.
Making false or misleading environmental claims and failing to follow them up with action gives permission for other brands and consumers to do the same. This removes accountability, allows businesses to carry on with their environmentally harmful activities, and prevents the development of a sustainable economy. In the built environment in particular, where we have a responsibility to champion sustainability and the push to achieving net zero, greenwashing can have a disastrous environmental impact.
Being accused of greenwashing can also destroy a brand’s reputation. With incoming generations of consumers increasingly concerned about sustainability and customer loyalty on the decline since the pandemic, negative publicity can jeopardise on an organisation’s standing with consumers. As in the case with the 2015 Volkswagen emissions scandal, this can damage can take significant effort to repair – something not all companies could recover from.
10 types of greenwashing
Being able to identify greenwashing practices – both in your own business and in the wider marketplace – is crucial to ensuring accountability and staying on track with global sustainability goals. However, there are various different ways organisations attempt to camouflage their products and operations:
1. Green but vague language
You should always be sceptical of products or services labelled ‘green’, ‘sustainable’, or ‘eco-friendly’ if no standards, green practices, or examples of evidence are actually shared by the organisation. These vague claims and buzzwords are known as ‘green labelling’.
2. Misleading or false data
Along with making baseless environmental claims through language, organisations will often fabricate data or fund research to produce misleading data that improves their image. Even for claims and green products that do have research behind them, it’s worth being sceptical, as many studies are sponsored by industry firms, which may influence the published results.
3. Greenlighting
Greenlighting – as highlighted in a recent report by Planet Tracker – is using communications and marketing to point out particularly green features of a company‘s operations or products and divert attention from poor environmental practices they’re performing elsewhere.
4. Greenhushing
Similar to greenlighting, greenhushing is where corporate communications deliberately underplay, under-report and hide data on sustainability. Collating data on sustainability is often a difficult process, but it’s crucial if businesses want to keep in line with environmental, social and governance (ESG) requirements.
Learn more: Technology will define the future of sustainability
5. Greenrinsing
In this example of greenwashing, companies will modify their ESG targets before they’ve even been achieved – thus avoiding being held accountable and never actually achieving their goals.
Learn more: This is why your sustainability initiatives are failing
6. Greenshifting
Greenshifting is where companies attempt to shift the narrative and place the blame on the consumer, implying they are the ones at fault.
7. Greencrowding
Greencrowding is where companies hide in groups to avoid having their environmentally damaging practices discovered.
8. Deceptive imagery
We often associate sustainability with green imagery, be it trees, forests, grass, or flowers. Unfortunately, this is a deceptive way companies can try to appear more environmentally friendly than they actually are.
9. Offsetting
Carbon offsets are a common practice when companies compensate for their emissions by taking part in activities that reduce the amount of carbon in the atmosphere, like reforestation or investing in renewable energy.
While it can help a brand‘s reputation and help businesses comply with regulations, scepticism is high around the actual environmental impact of offsetting, and organisations like Greenpeace view offsets as a way for businesses to detract from the environmental damage caused by their own practices.
Learn more: The pros and cons of carbon offsetting: is it just another form of greenwashing?
10. Certifications
As sustainability has grown into a commercial imperative, certifications and standards have emerged to help businesses and individuals assess the environmental credentials of their facilities. In the built environment for instance, green building certifications like BREEAM, LEED and Passive House have been adopted to recognise the sustainability credentials of a building or piece of infrastructure.
However, critics observe that many of these building certifications only take into account the embodied emissions from a project, rather than the operational emissions that result from its usage.
Learn more: It’s not easy, being green – are green building certifications just greenwash?
10 real-world examples of greenwashing
Businesses of all sizes have been found guilty of trying to greenwash their operations in recent years. Here are some of the worst offenders:
1. Shell
In 2020, oil company Shell asked what people were prepared to do to help reduce the world’s greenhouse gas emissions. This garnered controversy, considering Shell’s plans to increase fossil fuel consumption (despite pledging to achieve net zero by 2050), and they were subsequently called out by American politician Alexandra Ocasio-Cortez on X (then Twitter):
2. Alliance to End Plastic Waste (AEPW)
A Planet Tracker report, released in 2022, identified the members of the Alliance to End Plastic Waste (AEPW) as being involved in greencrowding:
“In the first three years of its operation, the AEPW recycled less than 0.0004% of global plastic generated… In addition, the top 10 producers of single-use plastic in the Alliance did not even remove or recycle 99.99% of their own plastic… Finally, none of the group’s progress reports provide transparent, measurable and audited information.”
3. McDonald’s
In 2019, fast food giant McDonald’s replaced their controversial plastic straws with paper ones, only for it to be revealed that these weren’t recyclable either.
This wasn’t the only time McDonald’s encountered pushback for its sustainability marketing. In 2021, the brand opened its first ‘net zero carbon‘ restaurant. However, as Anna Jones from Greenpeace UK pointed out:
“If meat and dairy are still the main course on McDonald’s menu, then this new restaurant initiative can only be labelled as it is: McGreenwash.”
4. H&M
The fashion industry is well known for its high levels of pollution. A shocking 96% of fashion brand H&M’s environmental claims were found to be inaccurate in a report by Changing Markets Foundation. In truth, H&M are just one example of the many fashion brands found guilty of greenwashing.
5. FortisBC
Earlier this year, gas utility company FortisBC was sued by British Columbia, who accuse FortisBC of ‘wrongly implying that its products are cheaper than using electrical heat pumps and that its renewable natural gas product is certified carbon neutral‘.
6. Quorn
The Advertising Standards Authority ruled that an advert for Quorn Foods Thai Wonder Grains was ‘likely to mislead viewers’. The advert claims that the product ‘could help reduce our carbon footprint‘, and that consumers ‘who care about climate challenge’ should ‘take a step in the right direction’ by buying the item.
7. Unilever
Unilever, a British fast-moving consumer goods company, were investigated last year for making misleading sustainably claims in their marketing tactics. The organisation, which owns many sub brands including Dove, Magnum and Ben & Jerry’s, were accused of exaggerating how natural their products actually are and for using green imagery in a deceptive manner.
8. Innocent
Drinks brand Innocent are another company that have fallen foul of the Advertising Standards Authority for misleading customers in their advertising campaigns. According to the advertising watchdog, the brand were implying that buying their drinks ‘was a choice which would have a positive environmental impact when that was not the case’.
9. Anglian Water
Anglian Water supplies drinking water to around 4.3 million customers in the United Kingdom. In 2023, the brand pled guilty to allowing millions of litres of untreated sewage to overflow from a water recycling centre in Essex, and were subsequently fined £2.65 million.
An advertising campaign was launched by the brand less than a month after the brand issued an apology and accepted the fine, and came under heavy criticism for omitting significant information on the brand‘s history of pollution. The company have since pledged to spend £9 billion to counter problems with water shortages, higher temperatures and rainfalls, in a move which has once again been identified as greenwashing by critics.
10. Ryanair
Irish airline Ryanair have twice been accused of greenwashing. In 2020, an advert in which they claimed they had the lowest carbon emissions of any airline was banned by the Advertising Standards Authority, who pointed out that some of the data they used to back this up was dated from 2011.
Early in 2023, Ryanair once again came under fire when the Netherlands Authority for Consumers and Markets (ACM) accused them of making misleading claims around sustainability, from their use of language down to their claims about offsetting.
As Edwin van Houten, Director of ACM’s Consumer Department, commented:
“Even with CO2-compensation schemes, flying remains a highly polluting way of travelling. Airlines may offer CO2 compensation schemes, but they cannot give the impression that CO2 compensation will make flying sustainable.”
Learn more: 5 ways the built environment can avoid greenwashing
Sustainability isn’t a passing trend – it’s here to stay and is constantly evolving. If you want to inspire and action change in your career, UCEM’s MSc Innovation in Sustainable Built Environments will give you the skills you need, both now and in the future.
Find out more: MSc Innovation in Sustainable Built Environments – University College of Estate Management
