Flexible monthly business insurance
You might have heard the term ‘greenwashing’ bandied about in conversation with your peers or in the business sphere. But if you’ve landed on this article, you may want to understand a bit more about it, the types of greenwashing that you should be aware of as a business and how you can avoid it in your own green marketing and PR efforts.
Fear not – we delve into each of these areas here, so you come away equipped with all the knowledge to make confident green claims.
What is greenwashing?
Greenwashing is a term that refers to portraying a misleading image or giving false information about how positive a company’s environmental and social efforts are. Greenwashing can involve companies knowingly or unwittingly deceiving their customers through unsubstantiated green marketing or PR to suggest their products or services have environmental and/or social benefits.
Why is greenwashing harmful?
With growing concern over the fate of our planet, a lot of companies have made it part of their mission to become more sustainable, putting in place ambitious goals surrounding carbon neutrality, recyclable packaging, waste reduction and a circular economy.
On top of this, more and more consumers are seeking to shop with companies that have sustainable values, giving those who take environmental, social and governance (ESG) seriously a competitive advantage. For companies that have previously never thought about green credentials, this has created added pressure to conform, resulting in attempts to circumvent the issue by making untrue claims.
Businesses do this for a number of reasons: attempting to gain back all-important custom, keeping stakeholders happy, attracting new customers and distracting from the unsustainable systems that they continue to engage in.
But for consumers who are trying to shop with brands that are more eco-friendly and ethical, learning that the brand they’ve chosen has made false claims is disheartening, creating scepticism for the future. This leads to a loss of trust and loyalty on their part, but also tarnished reputations for all sustainable brands – not just the greenwashing ones.
There is very little regulation around what sustainable terms businesses can and can’t say. And due to insufficient regulations to police these statements, businesses can freely and openly continue to create the illusion that they’re greener than they are, causing further damage.
This is particularly pertinent for businesses that are trying to be greener but partner with or receive investment from other businesses. Even if your brand is as green as it can be but collaborates with businesses or clients that aren't, this can reflect badly on you.
For instance, a brand that markets itself as sustainable sells a stake of its company to a private equity firm that contributes to deforestation in the Amazon rainforest. Even if the brand that sold the stake wrote a justification for the decision, the investment would most likely leave a sour taste in the mouths of its loyal customers.
To make sure greenwashing stops diluting important and genuine messages, businesses (and individuals) should aim to learn the various types of greenwashing, so they can both avoid it themselves and know how to spot brands that are taking part in it.
Types of greenwashing (with examples)
There are seven main types of greenwashing, otherwise known as ‘the seven sins of greenwashing’. These are:
Misleading or false labels
Using badges, certificates or markers of sustainability that haven’t been rightly rewarded or have been paid for by the brand.
Making false or baseless green claims
Making statements that are not backed up by evidence, do not have a strategy behind them or are completely plucked out of thin air.
Making claims that could be construed in different ways or that don’t have any real specifics. This could include using buzzwords such as organic, circular, natural and eco-friendly or using imagery with greenery, nature or animals.
Making irrelevant claims
Making true claims but they are either not relevant to the product or are not particularly distinguishing. For instance, stating something is CFC-free, when the chemical is generally banned anyway.
The lesser of two evils
Stating that a product is greener than a competitor’s or another product in the range, despite it still being an unsustainable product.
Classing a product as green based on a narrow set of information or attributes. For example, harvesting organic cotton, without considering the amount of water being used or saying a product is recyclable without considering the production within a factory with high carbon emissions.
Creating a red herring
Making a small part of the product or line green to distract from continuing to create harmful products.
How to avoid greenwashing
Now you know the types of greenwashing, you can do what you can for your business to actively avoid it.
Here are some ways that you can do this.
Make sure that all the environmental claims you make are:
- Authentic: only state goals or actions if they are completely genuine and unquestionable
- Specific: backed up by strategy or evidence
- Easy to understand: using plain language and readable type
No one is perfect. And with so much to cover off when aiming to be sustainable, you’re not going to hit every mark as best as you can from the offset – and that’s OK.
The best thing you can do for your audience is to tell the truth. If there are areas in your ESG strategy that you know need improvement, call them out yourself. This leaves little room for others to call them out for you and strengthens the trust between your brand and your audience.
People value honesty and they’ll appreciate your candour.
Back up your sustainability claims with facts or a clear strategy
It’s all too easy to pick a goal and a date in the future and stick that in your mission statement. This tactic serves no one and will make it harder for you if people have questions.
When coming up with your goals, think about what you want to achieve in your sustainability strategy and ask yourself why you want to achieve that. From there, have a look at the research behind your potential goals and plot a road map.
Likewise, if you want to shout about some of the sustainability initiatives you’ve been taking part in, ask yourself if you have robust enough data to back it up. Are there any discrepancies? What areas of improvement are there and how will you address these in your claims?
Answering these questions will ensure there’s zero room for any claim that’s not 100% accurate.
Avoid generic terms or misleading labelling
When it comes to writing green claims, vocabulary and branding are key. Similar to the exercise in the previous step, if you’re going to use certain words or imagery ask yourself why you’re using them and question the type of impression this will make on your audience.
If the words and imagery you’re using are justified, then go ahead. But if you’re using them to distract from the main message, maybe consider shifting the main point of focus so your audience doesn’t get the wrong idea.
Entering the world of sustainability can be overwhelming and you might feel pressure to engage with it as soon as possible. But if this article proves anything it’s that – as businesses with branding, a platform and loyal consumers – we should walk before we run. If we all did, greenwashing would be a thing of the past.
You may also like:
This content has been created for general information purposes and should not be taken as formal advice. Read our full disclaimer.
We've made buying insurance simple. Get started.
- 02 February 20235 minute read
What do interest rate rises mean for small businesses?
As the Bank of England raised interest rates to 4% on 2 February – the tenth consecutive rate rise since 2021 – we look at how this affects small businesses.
- 13 January 20234 minute read
Allowable expenses when you’re self-employed
What are allowable expenses? Who can claim them? This guide covers all you need to know – helping you claim everything you’re entitled to.
- 05 January 20237 minute read
Key business dates for 2023
Get prepped for the year ahead with our business calendar, including tax and reporting deadlines, marketing days and changes to business rates.