By Chea Srun | XQuant
As the world’s economy is recovering from the pandemic, consumers became more and more aware of the challenges that we are facing with climate change and many societal issues. Either forced by regulators or simply responding to the demands of their customers, companies are offering more “sustainable” products. However, according to a study by the European Commission in 2021, 42% of the claims from various business sectors such as garments and fashion, cosmetics, and household equipment are exaggerated, false, or deceptive.
The number of green claims is following the increase of the consumers’ need for sustainable products. Investors are also requiring the companies to be more accountable for their environmental footprints. As a result, we can often observe greenwashing through the company’s products, or through the company’s official communication such as commercials or Corporate Social Responsibility (CSR) reports. Either way, consumers and investors have to be aware of those practices to avoid falling into the trap.
Below are some of the most commonly used greenwashing techniques with some examples:
Hidden Trade-off
Suggesting that a product is green based on a small set of attributes while still contributing negatively to other important environmental issues. Examples:
Nestlé pledged to ensure the palm oil it uses would be sourced in an environmentally friendly and socially responsible manner by 2020. In 2019, a satellite monitoring system for stopping deforestation was adopted by Nestle. In reality, as of today, Nestle continues to use cheap palm oil from obscure sources.
Starbucks in 2018 announced that the licensed stores will longer provide single-use plastic straws to its customers. However, the new lids will actually require the use of more plastic than the existing lids with straws.
The Happy Egg Co. sells free-range eggs, but whether chickens are free-range or battery hens, male chicks are considered an unwanted byproduct of egg production and are killed by either grinding them up alive or suffocating them.
H&M introduced a recycling scheme where customers can give back old clothes in exchange for a coupon to buy more clothes. Not only would it take H&M up to 12 years to use just 1,000 tons of clothing waste; the majority of unwanted clothes are sent to developing countries where they're unable to be processed. Meanwhile, H&M is producing the same volume of new clothes in a matter of days.
No proof
For example, various facial or toilet tissue products that claim to use a various percentage of recycled materials without providing any evidence.
Vagueness
Following words are often used by genuine eco-friendly brands, but can be also used by other unethical brands:
All-natural, Bio, Biodegradable, Botanical, Chemical-free, Clean, Compostable, Cruelty-free, Earth-friendly, Eco-friendly, Extracts, Free-range, Gentle, Green, Happy, Healthy, Herbal, Mineral, Natural, Non-hazardous, Non-toxic, Organic, Paraben-free, Plant-based, Plant-derived, Plastic-free, Pure, Quality, Raw, Recyclable, Reusable, Sulfate-free, Sustainable, Vegan-friendly, Wholesome.
As an example, Earth’s Best sells baby wipes with the label “Earth Friendly” when they are actually made with polyester and not biodegradable.
Irrelevance
In 2021 ExxonMobil came under fire for advertising that suggested that its experimental algae biofuels could one day reduce transport emissions, while it has no company-wide net-zero target and its 2025 emission reduction targets do not include the vast majority of emissions resulting from its products.
A product advertising to be CFCs-free is not particularly greener than other products because CFCs are banned in nearly all consumer products since 1978 in the US. Any product can make the same claim.
BP misled the public in 2019 with its advertisements that focused on BP’s low-carbon energy products when more than 96% of its annual spend is on oil and gas
Lesser evil
A claim that may be true but ignores the environmental impact of the product as a whole. For example organic cigarettes or fuel-efficient SUVs.
False or misleading claim
A classic example is Oji Paper when in 2008 the company was caught on lying on the recycling rate. Instead of a 50% recycling rate, it was only 5% to 10%.
H&M claimed in 2020 to make clothes from sustainable fabric with the Conscious Collection, but it was found to contain a higher proportion of synthetic fiber (72%) than its fast-fashion line (61%).
L'Oreal is mislabeling its products and marketing them as vegan-friendly despite the brand testing on animals. They're taking advantage of the lack of laws surrounding labels and wording on products.
Keurig led Canadian buyers to believe they could recycle their single-use plastic coffee pods by simply breaking open the top, emptying out the coffee, and throwing the empty carcass into recycling bins. In reality, the capsules weren’t accepted in most Canadian provinces, except for Quebec and British Columbia.
IKEA is among the best in the world in terms of its sustainability credentials but an investigation by Earthsight found that IKEA has been making beechwood chairs using illegally sourced wood from the forests of Ukraine’s Carpathian region, an area home to endangered beasts such as bears, lynxes, wolves, and bison.
SC Johnson claimed its glass cleaner Windex’s bottles are made from 100% “ocean plastic”. In fact, the plastic used to make the bottles were never in the ocean. It was pulled from plastic banks in Indonesia, the Philippines, and Haiti. This type of plastic is known as ocean-bound plastic because it would have otherwise ended up in the ocean.
Amorepacific got many complaints after a customer online noticed that the brand’s bottle labeled “Hello, I’m Paper Bottle” contained plastic. The customer posted a picture that clearly shows that Innisfree’s Green Tea Seed Serum is actually just a plastic bottle wrapped in paper.
Selective disclosure
A practice whereby firms mislead consumers about their actual environmental impact to create a false impression of transparency and accountability
Suggestive imagery
In 2000, BP announced that it was changing its name to “Beyond Petroleum” and changing its logo to the green sunflower.
The new Coca-cola Life used a green label instead of the traditional red color. The ad says “Sweetness from natural sources with lower calorie”, but the drink still contains 6.6% of sugar and is far from being healthy.
Symbolic action
In December 2017 BP (again) announced it was buying a US$200 million stake in the European solar power company Lightsource. The oil giant claimed it was ‘excited to come back to solar’ – but this purchase represents just 1% of BP’s 2017 capital expenditure of US$16 billion, with the remaining 99% going overwhelmingly into oil and gas.
Under reporting
Intentionally or unintentionally reporting only a subset of environmental impacts while ignoring some others.
Ambition without target
In 2018 Nestlé said that it had “ambitions” for its packaging to be 100% recyclable or reusable by 2025. However, environmental groups and other critics pointed out that the company hadn’t released clear targets, a timeline to accompany its ambitions, or additional efforts to help facilitate recycling by consumers.
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