In this era of sustainability, brands with eco-friendly claims are more and more popular. Not all eco-friendly claims can be proven to be true. Merriam-Webster defines greenwashing as “the act or practice” of trying to make a policy, product, activity etc. appear more environmentally friendly. Appearing to be environmentally friendly or environmentally harmful than they really are. It is also a marketing tactic whereby companies falsely or exaggerate their sustainability claims. The World Economic Forum says that greenwashing is a major problem in the consumer market, as it misleads buyers and impedes real environmental progress. One of the commonest greenwashing techniques is to use vague language. Many companies label their products “natural,” “green,” and “eco-friendly” with no scientific or regulatory backing.
Greenwashing in Sustainable Marketing.
An extensive investigation published by the European Commission in 2021 looked at 344 environmental claims that were questionable and revealed major gaps in transparency. Over half of the traders did not provide enough information to consumers so they could assess claims accuracy. 37% also used terms such as “eco friendly” or “sustainable” but without any concrete proof. In 42% of the cases investigated, authorities believed that misleading claims could be considered unfair business practices. This highlights the need for more stringent regulations to combat greenwashing. The Federal Trade Commission in the U.S. has noticed an increase of misleading claims about the environment, which is prompting more scrutiny. The FTC will review its Green Guides in 2022 to make sure that environmental marketing claims are transparent and reliable, given the growing demand from consumers for sustainability. FTC aims to increase consumer trust, prevent greenwashing and reinforce accountability in advertising.
Mori Hamada and Matsumoto is a Tokyo-based law firm that claims Japan will strengthen its regulatory framework in 2024 to fight misleading environmental claims. The Unjustifiable Payments Act was amended to introduce stricter penalties, as well as a commitment procedure to improve enforcement by Consumer Affairs Agency. The new provisions, along with the ones that allow contract cancellation for false sustainability claims highlight the increasing legal risk for companies who misrepresent their products. Volkswagen settled its “clean diesel scandal” of 2015, which involved the manipulation of software to cheat emission tests. The settlement was $14.7 billion. Shell’s 2023 climate strategy was criticized for not meeting climate targets. This revealed a disconnect between Shell’s sustainability rhetoric and its actual practices. In 2024, the German confectionery company Katjes was convicted of misleading marketing for falsely claiming that its products were “climate-neutral.” This led its environmental partner not to use this label. One of the commonest greenwashing techniques is to use vague language. Many companies label their products “natural,” “green,” and “eco-friendly” with no scientific or regulatory backing. Unmasking false certifications: A path to genuine sustainable practices
False Certifications are another way of deceiving consumers.
Brands display self-created labels that look official, but do not have third-party validation. The Federal Trade Commission in the U.S. has taken action against deceptive sustainability labeling used by large retailers like Walmart and Kohl’s. This reinforces the importance of genuine certifications. The FTC has proposed settlements for Walmart and Kohl’s that include injunctive measures, as well as imposing a combined penalty of $5.5million. This will affect how these companies represent textiles in future and make environmental claims related to bamboo. A 2023 Guardian article states that a large number of carbon offsets, including those with the highest sales, will likely be ineffective at reducing emission. Seventy-eight percent of the top 50 projects were classified as “likely trash” because they had fundamental flaws, like overestimated benefits for climate change or large hydroelectric dams that would’ve happened anyway. Many experts believe that carbon credits are only effective if they’re tied to permanent, new emission reductions. However, many projects allow polluters the freedom to carry on as normal. These findings reveal systemic problems in the voluntary market for carbon credits, which contribute little to climate change.
Consumers can identify truly sustainable products
With sustainability becoming a key selling point for many companies, it is difficult to distinguish between eco-friendly and merely advertised products. It’s important to know the indicators that truly sustainable products have and to be able to identify greenwashing. How can consumers identify products which are truly in line with their values? If a product is made of recycled materials but its manufacturing process has high pollution, then its benefit to the consumer is not clear.
- Search for third-party certifications. To avoid “greenwashing”, look out for eco-labels issued by trusted organizations such as Fair Trade, Forest Stewardship Council and Energy Star. The certifications come with independent verification to ensure the product is meeting strict environmental standards.
- Require Transparency. Authentic brands that are sustainable have transparent practices. The brands share important details on their supply chain, materials sources and environmental impact. Transparency helps customers make more informed choices about the sustainability commitment of a business. As an example, Euro News revealed that Zara had misled customers regarding the sustainability of their clothing line. This highlighted the importance of being transparent in claims about sustainability.
- Avoid Products with Vague Claims. Do not buy products which make vague claims such as “green” and “natural” that do not provide specifics or certified certifications. The vague claims are often used as marketing tricks, which makes it hard to determine a product’s true environmental impact.
- Investigate the brand’s history: Learn about the past sustainability practices of a particular brand. If a company has a history of making inconsistent or false claims, it can be determined if they are truly committed to sustainability. Zara’s false sustainability claims as reported in Euro Newsare an excellent example of the importance of research before trusting any brand’s “green credentials”.
- Evaluate the Product’s Entire Lifecycle. Consider all aspects of a product, including its raw materials and manufacturing processes. The environmental impact of a product can still be compromised if its manufacturing process produces high levels of pollution. The Guardian reports show how eco-labeled goods can cause environmental damage, particularly when they affect vulnerable groups.
Policy’s Role in Strengthening Sustainable Standards.
It is important to have a policy that strengthens sustainable standards in order to combat greenwashing, ensure the credibility of sustainability statements and fight climate change. The government and regulatory agencies must set clear and enforceable guidelines that businesses can follow to make environmental claims. This is especially true in the areas of carbon offset, renewable energy and waste management. Policies can help create an even playing field by ensuring that companies are held accountable and leveling the playing field. Policies that encourage true innovation and penalize deceptive behavior will also foster long-term environmental care. They reduce the risks of false claims, which ultimately lead to public distrust in sustainability. Globally, governments are adopting stricter policies in order to fight greenwashing. Green Claims Directive of the European Union aims at standardizing sustainability claims in all industries and ensuring accountability. FTC Green Guides in the U.S. provide updated guidelines on eco-marketing and address misleading claims. China’s Ministry of Ecology and Environment has announced tougher punishments for manufacturing companies that make false claims about sustainability. South Africa, Kenya and other African countries are tightening regulations to increase transparency in corporate sustainability reporting. The Australian Competition and Consumer Commission launched an investigation into false environmental claims made by the food and fashion industries in Australia.
The practice of greenwashing is not only misleading to consumers, but it also undermines real environmental progress. Businesses must put genuine sustainability over deceptive marketing in order to foster a sustainable market. Greenwashers will be scrutinized more as awareness increases. Those who are truly committed to sustainability, however, will gain consumer trust. Sustainability is more than a trendy trend. It is essential for our planet’s survival.
