greenwashing essay

GREENWASHING AND THE FIRST AMENDMENT

Amanda shanor & sarah e. light*.

Recent explosive growth in environmental and climate-related marketing claims by business firms has raised concerns about the truthfulness of these claims. Critics argue (or at least question whether) such claims constitute greenwashing, which refers to a set of deceptive marketing practices in which an entity publicly misrepresents or exaggerates the positive environmental impact of a product, a service, or the entity itself. The extent to which greenwashing can be regulated consistent with the First Amendment raises thorny doctrinal questions that have bedeviled both courts and scholars. The answers to these questions have implications far beyond environmental marketing claims. This Essay is the first to offer both doctrinal clarity and a normative approach to understanding how the First Amendment should tackle issues at the nexus of science, politics, and markets. It contends that the analysis should be driven by the normative values underlying the protection of speech under the First Amendment in the disparate doctrines that govern these three arenas. When listeners are epistemically dependent for information on commercial speakers, regulation of such speech for truthfulness is consistent with the First Amendment and subject to the laxer review of the commercial speech doctrine. This is because citizens must have accurate information not only to knowledgeably participate at the ballot box but also to have meaningful freedom in economic life itself.

The full text of this Essay can be found by clicking the PDF link to the left.

* Assistant Professor and Associate Professor at The Wharton School of the University of Pennsylvania, respectively. We are grateful to Floyd Abrams, Abbye Atkinson, Jack Balkin, Suneal Bedi, William Buzbee, William Eskridge Jr., Ted Mermin, James Nelson, Robert Post, Francesca Procaccini, Rebecca Tushnet, David Vladeck, and Shelley Welton; participants in faculty workshops at Stanford Law School, the University of North Carolina Law School, and the Berkeley Consumer Law & Economic Justice Workshop; par­ticipants in the Consumer Law Scholars Conference at Boston University School of Law, the Freedom of Expression Scholars Conference at Yale Law School, and the Georgetown Law Environmental Law Research Workshop; and our colleagues at Wharton and the University of Pennsylvania Law School for their helpful feedback and suggestions. All errors are our own.

Introduction

Business firms and other private actors are confronting the reality that urgent action to address climate change is required, not only through pub­lic regulation but also through private environmental governance. 1 1 Private environmental governance defines the overarching category of environmental standard-setting and enforcement actions taken by private actors like firms, nongovernmental organizations (NGOs), and multistakeholder groups that operate in par­allel with those undertaken by public law regulators. See Sarah E. Light, The New Insider Trading: Environmental Markets Within the Firm, 34 Stan. Env’t L.J. 3, 4–5 (2015); Sarah E. Light & Eric W. Orts, Parallels in Public and Private Environmental Governance, 5 Mich. J. Env’t & Admin. L. 1, 3 (2015); Michael P. Vandenbergh, Private Environmental Governance, 99 Cornell L. Rev. 129, 133 (2013). See generally Michael P. Vandenbergh & Jonathan M. Gilligan, Beyond Politics: The Private Governance Response to Climate Change (2017) (demonstrating that private environmental governance has resulted in a reduction in global emissions and arguing its benefits for addressing climate change). ... Close To date, more than 1,500 firms globally have announced their intention to reduce their greenhouse gas emissions to net zero by 2050 in accordance with the goals of the Paris Climate Agreement. 2 2 Data-Driven EnviroLab & NewClimate Inst., Accelerating Net Zero: Exploring Cities, Regions, and Companies’ Pledges to Decarbonise 13 (2020), https://newclimate.org/‌sites/default/files/2020/09/NewClimate_Accelerating_Net_Zero_Sept2020.pdf [https://‌perma.cc/8E2T-KFKW]. The Paris Agreement establishes a global goal of limiting the global increase in temperature to “well below 2°C above pre-industrial levels and . . . pursu[ing] efforts to limit the temperature increase to 1.5°C above pre-industrial levels” to avoid the worst impacts of climate change. Paris Agreement to the United Nations Framework Convention on Climate Change, art. 2, Dec. 12, 2015, T.I.A.S. No. 16-1104 (entered into force Nov. 4, 2016). ... Close Many firms have publicly stated their intentions to reach “net zero” or “carbon neutral” goals with respect to their own operations and purchased electricity. 3 3 Thomas Murray, Net Zero Is the New Business Imperative, Env’t Def. Fund+Bus. (Sept. 24, 2020), https://business.edf.org/insights/net-zero-emissions/ [https://perma.cc/‌N7B9-QQ76] (noting that the “number of net zero pledges has doubled in less than a year”). ... Close Others have gone farther, promising to reach net zero with respect to the emissions arising out of their lending portfolios, upstream supply chains, or down­stream consumption of their products. 4 4 Data-Driven EnviroLab & NewClimate Inst., supra note 2, at 4. ... Close These climate pledges have come from a wide variety of firms, including the six largest banks in the United States; 5 5 Sarah E. Light & Christina P. Skinner, Banks and Climate Governance, 121 Colum. L. Rev. 1895, 1896, app. at 1952 (2021); Avery Ellfeldt, Citi Goes Net Zero. Who’s Next?, ClimateWire (Mar. 2, 2021), https://www.eenews.net/climatewire/2021/03/02/stories/‌1063726339?utm_campaign=edition&utm_medium=email&utm_source=eenews%3Aclimatewire (on file with the Columbia Law Review ). ... Close managers of more than $9 trillion in assets; 6 6 Press Release, Ceres, Leading Asset Managers Commit to Net Zero Emissions Goal With Launch of Global Initiative (Dec. 11, 2020), https://www.ceres.org/news-center/‌press-releases/leading-asset-managers-commit-net-zero-emissions-goal-launch-global [https://perma.cc/PG9W-N2PA]. ... Close technology firms like Google 7 7 Google Sustainability, https://sustainability.google/commitments/#leading-at-google [https://perma.cc/729A-XAXE] (last visited Aug. 5, 2022) (pledging to be carbon-free by 2030). ... Close and Microsoft; 8 8 Brad Smith, Microsoft Will Be Carbon Negative by 2030, Microsoft: Off. Microsoft Blog (Jan. 16, 2020), https://blogs.microsoft.com/blog/2020/01/16/microsoft-will-be-carbon-negative-by-2030/ [https://perma.cc/G8FY-XUVD]. ... Close consumer-facing firms like McDonald’s; 9 9 McDonald’s Accelerating Climate Action to Reach Net Zero Emissions by 2050, McDonald’s (Oct. 4, 2021), https://corporate.mcdonalds.com/corpmcd/en-us/our-stories/‌article/Featured.net-zero-by-2050.html [https://perma.cc/M7UM-U8ER] (an­nouncing that the company is joining the UN’s “Race to Zero” campaign and the Science Based Targets Initiative’s  “Business Ambition for 1.5°C” campaign). ... Close oil and gas majors like BP 10 10 Press Release, BP, BP Sets Ambition for Net Zero by 2050, Fundamentally Changing Organisation to Deliver (Feb. 12, 2020), https://www.bp.com/en/global/corporate/news-and-insights/press-releases/bernard-looney-announces-new-ambition-for-bp.html [https://‌perma.cc/J5RU-E8KS]. ... Close and Shell; 11 11 Media Release, Shell, Shell Accelerates Drive for Net Zero Emissions With Customer-First Strategy (Feb. 11, 2021), https://www.shell.com/media/news-and-media-releases/2021/shell-accelerates-drive-for-net-zero-emissions-with-customer-first-strategy.html [https://perma.cc/54YZ-V7PF]. ... Close the largest producer of aluminum in the United States, Alcoa; 12 12 Press Release, Alcoa, Alcoa States Its Ambition to Reach Net Zero Greenhouse Gas Emissions by 2050 (Oct. 4, 2021), https://news.alcoa.com/press-releases/press-release-details/2021/Alcoa-States-Its-Ambition-to-Reach-Net-Zero-Greenhouse-Gas-Emissions-by-2050/default.aspx [https://perma.cc/MV7R-U3XC]. ... Close and even a NASCAR racing team. 13 13 Jenna Fryer, Roush Fenway Becomes 1st Carbon Neutral NASCAR Team, ClimateWire (Feb. 19, 2021), https://www.eenews.net/climatewire/2021/02/19/stories/‌1063725431?utm_campaign=edition&utm_medium=email&utm_source=eenews%3Aclimatewire (on file with the Columbia Law Review ). ... Close Firms have formed or joined coalitions, like the Glasgow Financial Alliance for Net Zero, pursuant to which “over $130 trillion of private capital is committed to transforming the economy for net zero” comprising commitments by more than 450 firms in forty-five countries. 14 14 Press Release, Glasgow Financial Alliance for Net Zero, Amount of Finance Committed to Achieving 1.5°C Now at Scale Needed to Deliver the Transition (Nov. 3, 2021), https://www.gfanzero.com/press/amount-of-finance-committed-to-achieving-1-5c-now-at-scale-needed-to-deliver-the-transition/ (on file with the Columbia Law Review ). ... Close One of the boldest claims in this regard is Occidental Petroleum’s recent statement that it has delivered the “world’s first shipment of ‘carbon-neutral’ oil.” 15 15 Carlos Anchondo, Company Claims World’s First CO2-Neutral Oil. Is That True?, EnergyWire (Feb. 3, 2021), https://www.eenews.net/energywire/2021/02/03/stories/‌1063724089?utm_campaign=edition&utm_medium=email&utm_source=eenews%3Aenergywire (on file with the Columbia Law Review ); News Release, Oxy, Oxy Low Carbon Ventures, Together With Macquarie, Deliver World’s First Shipment of Carbon-Neutral Oil (Jan. 28, 2021), https://www.oxy.com/news/news-releases/oxy-low-carbon-ventures-together-with-macquarie-deliver-worlds-first-shipment-of-carbon-neutral-oil/ [https://perma.cc/AS8E-9LV5] (noting that greenhouse gas emissions from the oil’s lifecycle were being offset). ... Close There has been an explosion in the growth of investment funds marketed as “green” or otherwise socially responsible. 16 16 Evie Liu, SEC’s Gensler Is Targeting Greenwashing of ESG Funds, Barron’s (Mar. 1, 2022), https://www.barrons.com/articles/sec-gensler-greenwashing-esg-funds-51646166625 (on file with the Columbia Law Review ). ... Close These public statements are not limited to climate pledges but include promises to improve environmental perfor­mance along other dimensions, such as with respect to water use; reducing waste, the use of toxic chemicals, and deforestation; and preserving biodiversity.

This exponential growth in environmental marketing claims has raised concerns about their truthfulness. Critics argue (or at least question whether) such claims constitute greenwashing. 17 17 See, e.g., Thomas Day, Silke Mooldijk, Sybrig Smit, Eduardo Posada, Frederic Hans, Harry Fearnehough, Aki Kachi, Carsten Warnecke, Takeshi Kuramochi & Niklas Höhne, Corporate Climate Responsibility Monitor: Assessing the Transparency and Integrity of Companies’ Emission Reduction and Net-Zero Targets 5 (2022), https://newclimate.org/‌sites/default/files/2022-06/CorporateClimateResponsibilityMonitor2022.pdf [https://perma.cc/WV7S-M8GF] (assessing the climate strategies and claims of twenty-five major global firms and finding that net-zero commitments reduce aggregate emissions on average by 40%, rather than 100%); Ashish Kothari, The ‘Net-Zero’ Greenwash, Meer (July 13, 2021), https://www.meer.com/en/66356-the-net-zero-greenwash [https://perma.cc/‌B4VX-UPWG] (suggesting that “net zero” is just hiding business-as-usual strategies); Joel Makower, Is ‘Net-Zero’ Greenwash?, Greenbiz (Nov. 17, 2020), https://www.greenbiz.com/‌article/net-zero-greenwash (on file with the Columbia Law Review ) (questioning the integrity of net-zero commitments and identifying ways in which firms can hedge their pledges); Tim Quinson, Al Gore Warns Greenwashing May Stop the Climate Fight in Its Tracks, Bloomberg (July 13, 2021), https://www.bloomberg.com/news/articles/2021-07-13/al-gore-warns-greenwashing-may-stop-climate-fight-in-its-tracks-green-insight (on file with the Columbia Law Review ) (noting former Vice President Al Gore’s concern that greenwashing can undermine progress in addressing the climate emergency). ... Close Greenwashing generally refers to a set of deceptive marketing practices in which an entity publicly misrepresents or exaggerates the positive environmental impact or attrib­utes of a product or service to create a favorable impression that is not supported by evidence (product-level claims), or in which an entity mis­represents the entity’s overall impact on the environment (firm-level claims). 18 18 Miriam A. Cherry & Judd F. Sneirson, Beyond Profit: Rethinking Corporate Social Responsibility and Greenwashing After the BP Oil Disaster, 85 Tul. L. Rev. 983, 985 (2011) (defining greenwashing as the use of environmental rhetoric without actual commitment); Magali A. Delmas & Vanessa Cuerel Burbano, The Drivers of Greenwashing, 54 Cal. Mgmt. Rev. 64, 65 (2011) (defining greenwashing as “the intersection of two firm behaviors: poor environmental performance and positive communication about environmental perfor­mance”); William S. Laufer, Social Accountability and Corporate Greenwashing, 43 J. Bus. Ethics 253, 253 (2003) (defining greenwashing as a “form[] of disinformation from organ­izations seeking to repair public reputations and further shape public images”). In litigation against ExxonMobil, the Commonwealth of Massachusetts focused on how companies employ greenwashing to induce consumers to purchase their products. Massachusetts v. ExxonMobil Corp., 462 F. Supp. 3d 31, 37 (2020). Some have distinguished greenwashing from “environmental fraud.” See Eric W. Orts & Paula C. Murray, Environmental Disclosure and Evidentiary Privilege, 1997 U. Ill. L. Rev. 1, 7, 49 (defining environmental fraud as “[f]ailure to disclose legal violations found through [environmental] auditing in public re­ports” and arguing that it should be subject to harsher penalties than other false or misleading statements made in environmental reports). While common law findings of lia­bility for past misleading statements about firms’ own knowledge are outside of the direct scope of this Essay, such claims would be subject to the same First Amendment values and doctrines articulated here. See generally N.Y. Times v. Sullivan, 376 U.S. 254, 279–83 (1964) (applying First Amendment limits to defamation cases brought against public officials). For this Essay’s taxonomy of greenwashing, see infra Part I. ... Close Importantly, the term “greenwashing” is a broad descriptor, not a legal term of art like “fraud” or “negligence.” Whether different types of claims about environmental performance or intentions that might be described as greenwashing are “false” or “misleading” has significant First Amendment implications—implications that bear on whether such claims are protected speech or can be legally regulated for truthfulness.

Accusations of greenwashing have bedeviled firms with respect to their marketing of specific products, with some claims rising to the level of legal action. 19 19 For a discussion of the legal enforcement mechanisms available to combat greenwashing, see infra Part II. ... Close Procter & Gamble faced claims of greenwashing when it ad­vertised a brand of paper towel as containing recycled material when in fact only the inner cardboard tube contained recycled fibers. 20 20 Jill Meredith Ginsberg & Paul N. Bloom, Choosing the Right Green Marketing Strategy, 46 Mass. Inst. Tech. Sloan Mgmt. Rev. 79, 79 (2004) (mentioning the Procter & Gamble case). ... Close Firms have faced class action lawsuits under state consumer protection laws, such as one suit against a cookware company based on its claims that its pots and pans were “toxin free” and “good for the environment” when they alleg­edly contained “compounds that are known to be toxic.” 21 21 Class Action Complaint & Demand for Jury Trial paras. 4–5, Saldivar v. Cookware Co., No. 19-cv-06014-JST (N.D. Cal. filed Sept. 25, 2019) (emphasis omitted). ... Close Others have faced lawsuits alleging false and deceptive advertising based on advertise­ments that cleaning products were “non-toxic” and “earth friendly” when they allegedly contained ingredients that were harmful to people, animals, and the environment. 22 22 See Bush v. Rust-Oleum Corp., No. 20-cv-03268-LB, 2021 WL 24842, at *1, *6 (N.D. Cal. Jan. 4, 2021) (denying motion to dismiss claims that Rust-Oleum misrepresented Krud Kutter as “non-toxic” and “earth friendly” when the products were alleged to harm humans, animals, and the environment); Companies Accused of Greenwashing (Apr. 22, 2022), https://www.truthinadvertising.org/six-companies-accused-greenwashing/ [https://​perma.cc/​2ATT-ME35] (last updated June 28, 2022) (listing other companies accused of falsely marketing their products). ... Close And greenwashing claims surrounded the infa­mous Keurig coffee pods, based on Keurig’s claims that the pods were recyclable when a substantial number of nationwide recycling facilities would not actually accept them for recycling. 23 23 See Smith v. Keurig Green Mountain, Inc., No. 18-cv-06690-HSG, 2020 WL 5630051, at *1, *3 (N.D. Cal. Sept. 21, 2020) (granting motion for class certification under California law as to whether claim that Keurig’s K-Cups were “recyclable” was deceptive). ... Close Despite greenwashing’s broad definition, which encompasses both product- and firm-level claims, much of the focus to date—at least when it comes to litigation—has been on product-level claims. 24 24 Entities other than business firms can engage in greenwashing. Frances Bowen, After Greenwashing: Symbolic Corporate Environmentalism and Society 3 (2014) (arguing that greenwashing can occur at the firm or product level); Thomas P. Lyon & A. Wren Montgomery, The Means and Ends of Greenwash, 28 Org. & Env’t 223, 225 (2015) (noting that NGOs and governments can engage in greenwashing and in fact “may often serve as partners in corporate greenwashing”). The focus here, however, is on consumer-oriented claims in the marketplace, and thus this Essay focuses exclusively on business firms. ... Close

The issue of greenwashing is taking a broader turn, however, with much higher stakes. In March 2021, three environmental organizations filed a complaint with the Federal Trade Commission (the FTC or the “Commission”), the federal agency charged with enforcing laws that pro­hibit false and deceptive claims in advertising. 25 25 See infra Part II. ... Close The complaint contends that the fossil fuel firm Chevron has engaged in greenwashing by overstat­ing and misrepresenting the firm’s overall efforts to reduce emissions of greenhouse gases and increase its investments in renewable energy. 26 26 Myles McCormick, Chevron Accused of ‘Greenwashing’ in Complaint Lodged With FTC, Fin. Times (Mar. 16, 2021), https://www.ft.com/content/2985e18a-fdcb-4cd2-aee3-d5a0fe4cdab2 (on file with the Columbia Law Review ); Corey Paul, Environmental Groups Accuse Chevron of ‘Greenwashing’ in FTC Complaint, S&P Glob. Mkt. Intel. (Mar. 16, 2021), https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/environmental-groups-accuse-chevron-of-greenwashing-in-ftc-complaint-63206914 [https://perma.cc/VBP3-ZHB3]. ... Close This is the first complaint filed with the Commission invoking the Commission’s “Green Guides” to claim that a firm has misled consumers about how it markets its overall climate strategy and the environmental impact of its operations , rather than merely a complaint about the marketing of a specific product or service. 27 27 Paul, supra note 26. ... Close

Why does this matter? At a basic level, whether the law can regulate firms’ green marketing claims for truthfulness has material implications for whether, collectively, humanity can keep global emissions below a threshold to avoid the worst impacts of climate change. Misleading and deceptive claims about emissions reductions and climate-friendly business strategies can muddy the waters of what firms are actually doing to address climate change. Consumers and investors, who are often information de­pendent upon firms to shed light on their practices and strategies, may be misled into taking actions within the marketplace that are inconsistent with achieving either personal or societal climate goals. And they may not demand the political action they might, were they to know more clearly what the private sector is (or is not) doing to mitigate climate change. The primary motivating question of this Essay is therefore the extent to which the First Amendment permits regulation of firms’ environmental claims for truthfulness.

Under this Essay’s analysis, a broader set of green marketing claims can be constitutionally regulated for truthfulness and a broader set of statements by business firms should be treated with relaxed constitutional scrutiny than current doctrine arguably envisions. This is for two reasons. First, many forms of greenwashing—namely those that are false or mislead­ing, or which provide information that informs consumers’ political choices—are subject to either no First Amendment coverage or the reduced scrutiny of the commercial speech doctrine under current law. Since the 1990s, however, established law has been increasingly under­mined and contested, as litigants have sought to—and some courts have agreed to—transform the First Amendment into an all-purpose deregula­tory tool in what many have described as First Amendment Lochnerism or New Lochnerism. 28 28 There is a large literature describing First Amendment Lochnerism. Amanda Shanor, First Amendment Coverage, 93 N.Y.U. L. Rev. 318, 331 n.57 (2018) [hereinafter Shanor, First Amendment Coverage] (collecting citations); Amanda Shanor, The New Lochner , 2016 Wis. L. Rev. 133, 182–91 [hereinafter Shanor, The New Lochner ] (analyzing the parallels and differences between modern commercial speech doctrine and Lochner v. New York, 198 U.S. 45 (1905), and concluding that the First Amendment has the potential to serve as an even more powerful deregulatory tool than did the liberty of contract announced in Lochner ). ... Close This Essay pushes back against that deregulatory effort. Second, both pre-New Lochnerism commercial speech law and the dereg­ulatory view that now challenges it fail to offer a coherent view of the freedom of speech or the forms of democracy it advances. This Essay thus breaks new ground in offering a new theory of the purposes of the freedom of speech in economic life.

In making this argument, this Essay begins by explaining that courts addressing speech rights in these contexts have, to date, produced notori­ously confusing and inconsistent First Amendment case law. The root of that confusion is that speech at the juncture of politics, markets, and sci­ence also sits at the intersection of three quite disparate First Amendment doctrines: the First Amendment principles that apply to speech in public discourse (politics), the commercial speech doctrine and related doctrines that generally apply to expression in economic life (markets), and free speech doctrines around expertise and knowledge production (science). 29 29 See Robert Post, Compelled Commercial Speech, 117 W. Va. L. Rev. 867, 871–72 (2015) [hereinafter Post, Compelled Commercial Speech] (“[T]he Constitution values dif­ferent kinds of speech for different reasons. First Amendment doctrine protects each distinct kind of speech in a manner appropriate for safeguarding its particular kind of constitutional value.”). ... Close These contrasting doctrines reflect distinct constitutional values, constitu­tionally relevant institutional differences, and varying approaches to the production of information, individual choice, and truth and falsity.

Ultimately, this Essay does not simply apply existing First Amendment speech doctrine to green marketing claims. Instead, it evaluates and re­conceives the purposes of the First Amendment regarding expression at the juncture of politics and markets. It argues that the values underlying the freedom of speech are to protect decisional and participatory liberty in both political and economic life. The purpose of the First Amendment in both settings, it contends, is to advance a deep form of participatory democracy. This theory provides needed explanatory support for First Amendment doctrine that predates the New Lochnerism and goes beyond it to advance a holistic understanding of the purposes of the freedom of speech at this intersection.

While seeds of this understanding of the First Amendment are present both in canonical commercial speech cases and in the broader pattern of First Amendment coverage, 30 30 See infra Part III. ... Close the notion that the freedom of speech does and should advance democratic norms in economic life has been largely ignored. The principal self-government theories of the First Amendment understand democracy as voice in government. This Essay argues that this conception of governance unduly limits the scope of de­mocracy and depends on a questionable division between the political and the commercial. Instead, it adopts a more capacious notion of democratic participation and recognizes that there is no clear ex ante philosophical boundary between speech that is “commercial” (and thus subject to regu­lation for truthfulness) or “political” (and thus presumptively not subject to such regulation). It argues that by looking at the normative values ani­mating these different doctrines and the sorts of social relationships they seek to regulate and produce, we can ask more tractable questions.

This Essay delves into the case of greenwashing because it highlights the underlying core values that the First Amendment aims to protect, which is where any assessment of First Amendment doctrine should begin. This focus on underlying values—to protect decisional and participatory liberty in both political life and the marketplace, especially in cases of informational asymmetry—yields the conclusion that more green market­ing claims ought to be subject to regulation for truthfulness than are un­der the current doctrinal morass. This new theoretical lens will not only clarify the First Amendment status of greenwashing (and the regulations that seek to address it) but also provide a conception of the First Amendment that advances democracy in a more thoroughgoing way.

The Essay proceeds in five parts. Part I provides the key features of greenwashing as a broad concept, and Part II elaborates the regulatory authority of government actors like the FTC and the states to address com­mercial speech that is false, deceptive, or misleading. Part III details the First Amendment terrain in which greenwashing is situated and provides a typology of the relevant constitutional considerations that should inform the application of differing First Amendment rules. Part IV then brings these frameworks together and offers a path forward. It advances a new theory of the First Amendment contexts, values, and considerations that should inform the application of differing constitutional rules. Part V merges these inquiries to offer implications of this analysis for the varying forms of greenwashing the Essay identifies and provides some suggestions about solutions. In so doing, this Essay offers clarity for those addressing the increasingly important constitutional questions at the intersection of politics, science, and markets.

• Open access
• Published: 11 February 2020

Concepts and forms of greenwashing: a systematic review

• Sebastião Vieira de Freitas Netto 1 ,
• Marcos Felipe Falcão Sobral   ORCID: orcid.org/0000-0002-4768-2622 2 ,
• Ana Regina Bezerra Ribeiro 2 &
• Gleibson Robert da Luz Soares 2  

Environmental Sciences Europe volume  32 , Article number:  19 ( 2020 ) Cite this article

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The aggravation of environmental problems has led companies to seek the development and commercialization of green products. Some companies mislead their stakeholders through a phenomenon called greenwashing.

This paper aims to explore the phenomenon of greenwashing through a systematic literature review in search of its main concepts and typologies in the past 10 years. This research has followed the proceedings of a systematic review of the literature, based on the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA). We identified a major classification of greenwashing: firm-level executional, firm-level claim, product-level executional, and product-level claim.

It was possible to highlight and catalog the types of the phenomenon. A structure based on such type has been observed in the literature.

Since the aggravation of environmental pollution, many companies around the world have been paying more attention to environmental issues [ 20 , 41 , 53 ]. In China, environmental problems such as haze and water pollution have become increasingly prominent [ 21 ].

India is facing environmental issues such as rising air pollution, loss of food security and e-waste disposal pollution [ 16 ]. They have a 1.2 billion population and have generated 2.3 k MtCO2 emissions into the atmosphere in 2017 [ 18 ], classifying themselves as the third most polluter country only behind China and the US, long-time polluter ace.

Due to increasing of environmental problems, and consequently in public awareness, many stakeholders are more aware of environmental consideration [ 7 ]. Over the past decade, stakeholders like investors, consumers, governments, and corporate customers are increasing the pressure on companies to disclose information about their environmental performance [ 25 , 30 ] and for environmental-friendly products [ 21 ].

According to Vollero et al. [ 49 ], companies from the energy sector experiences increasing pressure from stakeholders to produce sustainable products and clean energy. Environmental awareness has grown on society [ 1 , 39 , 52 ], and especially on consumers [ 1 ], they are eager for environmental-friendly products [ 6 , 9 ].

The Nielsen Media Research [ 33 ] presented that 66% of global consumers are willing to pay more for environmentally friendly products. When these customers perceive firms as socially responsible, they may be more willing to buy the products from these firms at a higher price [ 19 , 21 ].

In order to respond to these issues, Corporate Social Responsibility (CSR) is gaining importance among business leaders [ 39 ]. CSR is defined as “a concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis” [ 13 ].

To reach the integration of social and environmental concerns in business operations companies must be sustainable and socially responsible [ 1 ], not only economically. They have to aim the three bottom lines: economic, environmental and social performance or people, planet and profit [ 12 ].

Sustainable development is defined by “development that meets the needs of the present without compromising the ability of future generations to meet their own needs” [ 51 ]. The growing demand “drives firms to develop green marketing strategies to show consumers their good corporate image and social responsibility” ([ 53 ], p. 740).

Since reported by Delmas and Burbano [ 11 ], the green market is proliferating. Consumer, capital markets, products, services, and firms have been expanding. As there is an increase in green markets, it is followed by the phenomenon of greenwashing [ 28 ]. The phenomenon is defined as “the intersection of two firm behaviours: poor environmental performance and positive communication about environmental performance” ([ 11 ], p. 65).

There are many different definitions of greenwashing, in various perspectives. This review attends to search the recent literature to identify the different definitions of greenwashing and its forms. The primary purpose of this article is to analyze the different typologies and characteristics of greenwashing. In order to achieve the objective, we sought to systematically review the last 10 years in the literature. A systematic literature review has been conducted in search of the phenomenon definitions and related concepts; and its characteristics and typologies.

Stakeholders and society in general, demands transparency in disclosing information about the environmental impact of companies activities, this communication must be dynamic, through different channels and with the purpose of educating awareness [ 1 ]. The Federal Trade Commission ([ 14 ], p. 62122) instructs to “use clear and prominent qualifying language to convey that a general environmental claim refers only to a specific and limited environmental benefit(s)”.

The advent of Web 2.0 brings new social media tools, and stakeholders can exercise new forms of interacting and sharing information through the Internet. Online corporate pages or blogs, wiki and petitions websites, and particularly social networks like Twitter and Facebook are redefining the interactions and communications between companies and their stakeholders [ 17 ].

Some companies invest in green marketing communications, to be perceived as eco-friendly and socially engaged. They advertise and CSR to achieve better purchase intentions and brand attitudes [ 34 ]. However, the reality behind corporate environmentalism can be disappointing, TerraChoice [ 48 ] reported that 95% of products claiming to be green in Canada and the USA committed at least one of the “sins of greenwashing”, from the sin of the hidden trade-off to the sin of worshiping false labels.

Greenwashing was first accused in 1986 by activist Jay Westerveld, when hotels begin asking guests to reuse towels, claiming that it was a company water conservation strategy, although, did not have any environmental actions with more significant environmental impact issues [ 38 ].

According to advertising firm Ogilvy and Mather, greenwashing practices are growing in the last decades to epidemic proportions [ 24 ]. With the increase of green markets, followed by greenwashing, a trust problem has emerged since customers have difficulties in identifying a true green claim [ 34 ].

Green skepticism has grown with greenwashing, and it would obstruct green marketing [ 8 ]. Real green claims would suffer from greater skepticism since it is hard for customers to differentiate the reliability of green marketing initiatives. TerraChoice [ 48 ] has released a study to help customers identify greenwashing practices by companies with the seven sins of greenwashing.

In developed countries that have more significant environmental awareness, the regulation from the authorities is in a higher level of development compared to developing countries, in the US regulation of greenwashing is extremely limited with uncertain regulation enforcement [ 11 ]. In response to such non-binding regulatory guidelines, scholars, activists and environmentalists have argued that it inadequately protects consumers from the harmful effects of the phenomenon of greenwashing [ 15 ].

There are none or poor green regulation in developing countries governments even though the mass population does have any or poor concerns about environmental care. The practice of recycling by waste sorting and collection that seems to be a regular thing to do by the millennials in developed countries [ 35 ], on the other side in emerging countries, it is a privilege to have it.

This paper is structured as follows, in Methods we describe the methodological procedures, research questions, and search strategy. The next topic was presented the results followed by the discussion. The last topic is the conclusions.

This research has followed the proceedings of a systematic review of the literature, based on the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA). PRISMA is not a quality assessment mechanism, although it may be useful for critical appraisal by reviewers and editors. Its objective is to help authors to improve the reporting of systematic reviews and meta-analyses [ 40 ].

A protocol has been developed to specify the carefully planning proceedings and eligibility criteria, to select and identify the data of documents. According to Shamseer et al. [ 44 ], a protocol is an essential component of a systematic review, in the protocol are specified the pre-defined eligibility criteria and methodological approach, which ensures the consistency by the review team, accountability, research integrity and transparency.

Research questions

RQ 1: Which are the main definitions of Greenwashing and their evolution over the past 10 years?

RQ 2: Which are the characteristics and forms of Greenwashing?

Search strategy

All content and papers selected for each phase of the review were available for all the researchers in the cloud, the data sheets were created using a document cloud base application that enables collaboration from different persons remotely located. This strategy enabled better control and enhanced standardization of the process of the systematic review.

With the purpose of identifying and recovering the smallest possible number of publications, the research incorporates a search strategy. The resources used to searches are Web of Science ( http://www.webofscience.com ); and Scopus ( http://www.scopus.com ).

Scopus search engine offers a better tool in terms of detailed string than Web of Science. The search string from Scopus can be developed with a much-specified search query. When the search strings were applied, 84 publications were identified from Scopus and 179 from Web of Science, representing a total of 263 publications considering both engines.

The keywords applied in the search engines were: “greenwashing”, “greenwash” and “greenwasher”. Table  1 shows the specific search filters used on both Scopus and Web of Science databases.

Data selection

The data selection was performed in two steps: the first stage involved a Title and Abstract analyses; and the second stage involved an Introduction and Conclusion analyses.

In the first stage, an initial selection was performed on documents that reasonably satisfied the selection criteria based on the titles and abstracts reading. The process was handled in pairs to reduce possible bias and the researchers worked individually on the inclusion or exclusion of the documents and then compared the spreadsheets. When a divergence occurred and a consensus was not possible a third researcher was consulted. If the divergence still remained, the document was included in the list.

In the second stage, the selection was performed on documents that fairly satisfied selection criteria based on the introductions and conclusions reading. Similar to the first stage, the process was also managed in pairs with the same strategy in case of divergencies described in the first stage.

Data extraction and quality assessment

In the extraction stage, all the selected documents were assessed concerning the methodological quality, yet the results were not used to limit the selection.

We extracted 263 articles from Scopus and Web of Science, which eliminated all those present in both bases. Then, the title and abstract were read, resulting in 149 articles. Finally, the introduction and conclusion were read, leaving 67 documents. After the complete reading, 42 articles completely met the review protocol as presented in Fig.  1 .

Results achieved on each stage at the systematic review process

Table  2 reports the publication names of the journals that were included in the review. The journal that published most of the studies is “Journal of Business Ethics”, followed by “BioTechnology: An Indian Journal”, “Journal of Advertising”, “Journal of Business and Technical Communication”, and “Journal of Cleaner Production”.

The 67 documents included in the review were published in 50 different journals. There is a strong presence of publications from “Journal of Business Ethics” with 11 selected documents. This journal is devoted to a wide variety of methodological and disciplinary perspectives related to ethical issues in business.

There is a majority of Business and Management journals related to Environment and Sustainability issues in the selected papers. Others journals brought the greenwashing phenomenon in the fields of Advertising and Communications, Economics, Sociology and Ethics, Production Engineering, Marketing, Accounting, Tourism, Education and others. These results show the multidisciplinary characteristic of the phenomenon.

The selection included only papers in the period of 2009–2018, but no documents from 2009 and 2010 were included in this research. Observing Fig.  2 there is a relevant increase in the number of studies over time, with a peak in 2017. This trend suggests that there is an increasing interest for the phenomenon of greenwashing in the literature.

Evolution of the number of reviewed documents over time

Due to the objective of this paper, documents included in the review have been examined with precise attention to two main topics: definitions of greenwashing and related concepts; and the phenomenon characteristics and typology. 67 documents provided insights on definitions of greenwashing and related concepts. From the 67 selected documents, 17 also provided insights on the phenomenon characteristics and typology.

The term Greenwashing was coined first in 1986, by an environmentalist Jay Westervelt. He published an essay on the hospitality industry about their practices to promote towel reuse [ 20 , 52 ].

Several dictionaries define the phenomenon of greenwashing, Webster’s New Millennium Dictionary of English [ 31 ] defines greenwash as “practice of promoting environmentally friendly programs to deflect attention from an organization’s environmentally unfriendly or less savoury activities”. In 1999 the term was added to the Concise Oxford English Dictionary [ 36 ], that defines it as: “Disinformation disseminated by an organization so as to present an environmentally responsible public image; a public image of environmental responsibility promulgated by or for an organization, etc., but perceived as being unfounded or intentionally misleading”.

According to Lyon and Montgomery [ 27 ], there is no rigid definition of greenwashing due to its multifaceted nature. Above we describe the different main approaches we found in defining the phenomenon of greenwashing.

Greenwashing as selective disclosure

TerraChoice [ 48 ] defines greenwashing as “the act of misleading consumers regarding the environmental practices of a company or the environmental performance and positive communication about environmental performance”.

Delmas and Burbano ([ 11 ], p. 67) define as “poor environmental performance and positive communication about environmental performance”. Baum ([ 2 ], p. 424) considers greenwashing “the act of disseminating disinformation to consumers regarding the environmental practices of a company or the environmental benefits of a product or service”.

Tateishi ([ 47 ], p. 3) summarizes greenwashing as “communication that misleads people regarding environmental performance/benefits by disclosing negative information and disseminating positive information about an organization, service, or product”.

All of these authors describe the phenomenon as two main behaviors simultaneously: retain the disclosure of negative information related to the company’s environmental performance and expose positive information regarding its environmental performance. This two-folded behavior can be named as selective disclosure.

We found several articles considering greenwashing a type of selective disclosure. Lyon and Maxwell [ 26 ] presented the first economic analysis of greenwash, with specific persuasion game approach from Milgrom and Roberts [ 32 ]. Lyon and Maxwell ([ 26 ], p. 9) consider selective disclosure a form of greenwashing and define the phenomenon as “selective disclosure of positive information about a company’s environmental or social performance, without full disclosure of negative information on these dimensions, so as to create an overly positive corporate image”.

Lyon and Maxwell [ 26 ] assume social and environmental dimensions on their work, others consider only the environmental dimension, considering the social dimension a different phenomenon.

Marquis et al. ([ 30 ], p. 483) define selective disclosure as “a symbolic strategy whereby firms seek to gain or maintain legitimacy by disproportionately revealing beneficial or relatively benign performance indicators to obscure their less impressive overall performance”.

Greenwashing as decoupling

Some authors associate greenwashing to a decoupling behavior. Siano et al. ([ 45 ], p. 27) relate greenwashing with symbolic actions, “which tend to deflect attention to minor issues or lead to create ‘green talk’ through statements aimed at satisfying stakeholder requirements in terms of sustainability but without any concrete action”.

Walker and Wan [ 50 ] defines greenwashing as the gap between “symbolic” and “substantive” corporate social actions (CSA). Companies that have a negative CSR performance and at the same time apply a positive communication about their CSR performance.

As defined by Guo et al. ([ 22 ], p. 1828) greenwashing is essentially decoupling behaviours that are symbolic environmental protection behaviours with no environmental protection behaviour or failure to fulfil environmental protection commitments, to alleviate the external public pressures and uncertainties and to avoid the conflict with external constituents. The authors reinforce that these decoupling behaviors of greenwashing brands are to maintain corporate legitimacy.

Signaling and corporate legitimacy theory

The phenomenon of greenwashing was also related to corporate legitimacy theory in the literature. It can be distinguished in three types of corporate legitimacy: cognitive legitimacy, pragmatic legitimacy and moral legitimacy. According to Seele and Gatti [ 43 ], greenwashing occurs in the light of pragmatic legitimacy.

“Cognitive legitimacy is based on the shared taken-for-granted assumptions of an organization’s societal environment. Moral legitimacy relies on moral judgments about the organization and its behaviour…“ ([ 43 ], p. 242). And pragmatic legitimacy is “the result of self-interested calculations of the organization’s key stakeholders, and it is based on stakeholder’s perceptions of their personal benefit deriving from corporate activities and communication.” ([ 43 ], p. 242).

Guo et al. [ 22 ] explain that when companies fail to reach their green goals, the decoupling behaviors can reduce cognitive legitimacy (take-for grandness of constituents), moral legitimacy (positive green evaluation), and pragmatic legitimacy (benefiting constituents).

Which are the characteristics and forms of greenwashing?

According to Delmas and Burbano [ 11 ] greenwashing is the act of misleading consumers regarding the environmental practices of an organization (firm-level) or the environmental benefits of a product or service (product/service-level). An example of firm-level greenwashing is the “Ecomagination” campaign from General Electric which advertised the organization’s environmental practices while at the same time lobbied to fight new clean air EPA requirements [ 11 ]. An example of product/service-level greenwashing is the Energy Star mis-certified refrigerators from LG, an eco-label of energy efficiency, which was found that 10 models of LG’s refrigerators were not energy efficient to be certified [ 11 ].

We found two different major classifications of greenwashing: Claim greenwashing and Executional greenwashing. The studies on the literature concentrate on product/service-level claim greenwashing, while executional greenwashing was found only on two articles in this revision. Figure  3 shows the main classifications in the phenomenon of greenwashing.

Major classifications of greenwashing

Claim greenwashing

The majority of research to date has focused on product/service-level claim greenwashing, which uses textual arguments that explicitly or implicitly refer to the ecological benefits of a product or service to create a misleading environmental claim.

Parguel et al. [ 37 ], cited a study from 1991 in which Kangun, Carlson and Grove distinguished three categories of greenwashed advertising: (1) those employing false claims; (2) those omitting important information that could help evaluate the claim sincerity, and (3) those employing vague or ambiguous term, which could be summed up as lying, lying by omission or lying through lack of clarity.

From Tateishi [ 47 ] and Baum [ 2 ] we found cited a study conducted by Carlson et al. [ 5 ] that developed two typologies of green claims: (1) claim type; and (2) claim deceptiveness. Claim type involves five typological categories: (a) product orientation—claims centring on the ecological attribute of a product; (b) process orientation—claims centring on the ecological high performance of a production process technique, and/or an ecological disposal method; (c) image orientation—claims centring on enhancing the eco-friendly image of an organization, like claims that associates an organization with an environmental cause or activity which there is elevated public support; (d) environmental fact—claims that involves an independent statement that is ostensibly factual in nature from an organization about the environment at large, or its condition; and (e) combination—claims having two or more of the categories above [ 2 , 47 ]. The types of claims are presented in Fig.  4 .

Types of claims [ 5 ]

These claim types presented above can be classified in a second typology, claim deceptiveness, that also involves five typological categories: (a) vague/ambiguous—claims that are overly vague, ambiguous, too broad, and/or lacking a clear definition; (b) omission—claims missing the necessary information to evaluate its validity; (c) false/outright lie—claims that are inaccurate or a fabrication; (d) combination—claims having two or more of the categories above; and (e) acceptable—claims that do not contain a deceptive feature [ 47 ]. The claims are presented in Fig.  5 .

Claim deceptiveness [ 5 ]

An environmental marketing firm called TerraChoice [ 48 ] has created a classification called “the seven sins of greenwashing”. The classification has been cited in several articles, Scanlan [ 42 ] cited that it includes various fibs, half-truths, vagueness and other forms of trickery. Markham et al. [ 29 ] described that the seven sins assist more precisely in detecting instances of firm-based or product-based greenwashing.

Baum [ 2 ] cited that the seven sins of greenwashing can indicate the main ways in which a company can mislead consumers with environmental claims and uses these seven sins as a framework for their advertising analysis. According to Antunes et al. [ 1 ], the objective of the seven sins is to discourage companies to apply these green marketing strategies by giving the consumers information they need to be cautious in their purchase decisions.

Delmas and Burbano [ 11 ] explain that the TerraChoice Group’s seven sins are all product-level greenwashing. We have found quotes on 10 articles outlining the seven sins of greenwashing that are described below [ 48 ]:

The sin of the hidden trade-off: a claim suggesting that a product is ‘green’ based on a narrow set of attributes without attention to other important environmental issues. Paper, for example, is not necessarily environmentally preferable just because it comes from a sustainably harvested forest. Other important environmental issues in the paper-making process, such as greenhouse gas emissions, or chlorine use in bleaching may be equally important [ 48 ]. Other examples are energy, utilities and gasoline corporations that advertise about the benefits of new sources of energy while some are drilling into unexplored areas to source oil and thus destroying natural habitats and losing biodiversity, disguising the imbued hidden tradeoff [ 2 ].

The sin of no proof: an environmental claim that cannot be substantiated by easily accessible supporting information or by a reliable third-party certification. Common examples are facial tissues or toilet tissue products that claim various percentages of post-consumer recycled content without providing evidence [ 48 ]. In short terms, if a corporation makes a claim that includes some kind of percentage or statistics info that are not verified with something that could prove it, like a fine-print text or a URL to lead to more information, the claim is considered as no proof [ 2 ].

The sin of vagueness: a claim that is poorly defined or too broad, a claim lacking in specifics that its real meaning is inclined to be misunderstood by the consumer. ‘All-natural’ is an example of this sin. Arsenic, uranium, mercury, and formaldehyde are all naturally occurring, and poisonous. ‘All natural’ isn’t necessarily ‘green’ [ 48 ]. Other examples are “Non-toxic” because everything is toxic in certain dosages; “Green”, “Environmentally friendly”, “Eco-friendly”, and “Eco-conscious” are also vague because without elaboration they are meaningless [ 2 ].

The sin of worshipping false labels: a product that, through a false suggestion or certification-like image, mislead consumers into thinking that it has been through a legitimate green certification process. An example is a paper towel whose packaging has a certification-like image that makes a claim that the product “fights global warming” [ 48 ]. Other examples include green jargon such as “eco-safe” and “eco-preferred” [ 2 ].

The sin of irrelevance: an environmental claim that may be truthful but is unimportant or unhelpful for consumers seeking environmentally preferable products. ‘CFC-free’ is a common example, since it is a frequent claim despite the fact that CFCs are banned by law [ 48 ].

The sin of lesser of two evils: a claim that may be true within the product category, but that risks distracting the consumer from the greater environmental impacts of the category as a whole. Organic cigarettes could be an example of this Sin, as might the fuel-efficient sport-utility vehicle [ 48 ].

The sin of fibbing: environmental claims that are simply false. The most common examples were products falsely claiming to be Energy Star certified or registered [ 48 ].

Scanlan [ 42 ] conducted a research in the oil gas industry (OGI) communication on hydraulic fracking and proposed new sins related to the conceptualization of greenwashing. The OGI masks harm done and other risks with greenwashing in the form of new sins he elaborated build on TerraChoice [ 48 ]: (8) false hopes; (9) fearmongering; (10) broken promises; (11) injustice; (12) hazardous consequences; and (13) profits over people and the environment [ 42 ].

The sin of false hopes: a claim that reinforces a false hope. The OGI hydraulic fracking method has an enormous negative impact on the environment, critics argue that ecological modernization is not possible and believing otherwise is harmful to the environment [ 42 ].

The sin of fearmongering: claims that fabricate insecurity related to not “buying in” on an organization practice, like OGI hydraulic fracking [ 42 ]. Scanlan ([ 42 ], p. 16) explains that “shifting the scale of fear and seizing opportunities from instability and uncertainty borne out of wars in Afghanistan and Iraq, the global war on terror, and volatile fuel costs, alter the public perception of risk”.

The sin of broken promises: claims promising that fracking will lift up poor, rural communities with riches from mineral rights and economic development, but when evidence shows the contrary, communities are left with irreversible impacts ([ 46 ] apud [ 42 ]). Scanlan [ 42 ] describes that greenwashing obscures who loses regarding the negative impacts of fracking and OGI profits from exploiting the hopes and trust of the citizenry.

The sin of injustice: according to Scanlan [ 42 ] the environmental communication examined in his research does not speak directly to communities most affected by fracking, it focuses on a segment of the population that benefits from fracking but do not suffer its consequences.

The sin of hazardous consequences: greenwashing hides the reality of inequality and distracts the public from the dangers of risk other experience, Scanlan [ 42 ] includes another sin in reference to harm done from hazardous consequences.

The sin of profits over people and the environment: to profit over people and the environment is what Scanlan [ 42 ] describes as potentially the greatest greenwashing sin of all.

“The delivery of false hopes and resulting broken promises, fearmongering that reorients public understanding of risk and the hazardous consequences of fracking, environmental injustice, and the pursuit of profits over people and the environment have serious impacts on the planet” ([ 42 ], p. 20).

Contreras-Pacheco and Claasen [ 10 ] brought five firm-level greenwashing: (1) dirty business; (2) ad bluster; (3) political spin; (4) it is the law, stupid! [ 4 ]. Fifth firm-level greenwashing form: (5) fuzzy reporting [ 3 ].

Dirty business: belonging to an inherently unsustainable business, but promoting sustainable practices or products that are not representative either for the business or the society.

Ad bluster: diverting attention from sustainable issues, through the use of advertising. It is used to exaggerate achievements or present alternative programs that are not related to the main sustainability concern.

Political spin: influencing regulations or governments in order to obtain benefits that affect sustainability. It is common to notice that these spins are “justified” due to companies character of large taxpayers or employers.

It’s the law, stupid!: proclaiming sustainability accomplishments or commitments that are already required by existing laws or regulations.

Fuzzy reporting: taking advantage of sustainability reports and their nature of one-way communication channel, in order to twist the truth or project a positive image in terms of CSR corporate practices.

Executional greenwashing

Parguel et al. [ 37 ] described a new form of greenwashing that the authors called ‘Executional Greenwashing’. This strategy of greenwashing does not use any type of claim that was described before, but it suggests nature-evoking elements such as images using colors (e.g., green, blue) or sounds (e.g., sea, birds). Backgrounds representing natural landscapes (e.g., mountains, forests, oceans) or pictures of endangered animal species (e.g., pandas, dolphins) or renewable sources of energy (e.g., wind, waterfalls) are examples of executional nature-evoking elements [ 37 ]. The research addressed to this gap in the literature by documenting the executional greenwashing effect based on advertising execution knowledge.

These nature-evoking elements, intentionally or not, may induce false perceptions of the brand’s greenness. According to Hartmann and Apaolaza-Ibáñez ([ 23 ], apud Parguel et al. [ 37 ], p. 2) these elements can “trigger ecological inferences subtly by activating implicit references to nature through nature imagery”.

Parguel et al. [ 37 ] conducted a research that presented empirical evidence of the misleading effect of these nature-evoking elements named ‘executional greenwashing effect’ and moderator factors that may reduce its impact. The research consisted of a web survey considering two types of consumers: (a) non-expert consumers and (b) expert consumers.

The empirical results showed that the presence of advertising executional elements evoking-nature only generates higher perceptions of the brand’s greenness among non-expert consumers, expert consumers were not significantly affected.

In this paper, we have discussed the main concepts of greenwashing and its main types that we found present in the literature. Due to its multidisciplinary characteristic, no general definition of greenwashing is accepted to recent day. The phenomenon has been discussed by researchers from several areas such as Business, Communication, Economy, Production Engineering, Social Sciences, Environmental Management and Law.

Some scholars consider only environmental issues when talking about greenwashing, distinguishing it with the term bluewashing, which stands for social issues. Others researchers do not distinguish and consider greenwashing a social and environmental phenomenon.

We can see that greenwashing can be perceived and accused by the observer in several different ways. From product-level claims with environmental labeling to firm-level nature-evoked executional elements in sustainability reports, the phenomenon may be classified in a complex variety of options.

This multifaceted amount of forms in which greenwashing has been observed offers difficulty for consumers to identify the phenomenon manifestations. Even among consumers considered expert consumers, well informed about greenwashing and the market in question, it is a challenge to identify greenwashing. In consumers considered regular, who do not know or have limited information about the phenomenon, the accusation process is even more complicated.

The main definitions of greenwashing were explored in the literature. Most researchers are based on the definitions of the Oxford English Dictionary [ 36 ] and TerraChoice [ 48 ]. In these definitions, the phenomenon is seen as a deliberate corporate action with the presence of misleading elements, focused on the deception of stakeholders.

As greenwashing was first accused in 1986 by Jay Westerveld [ 38 ], an activist who noticed an organizational communication with a misleading trait, the element of accusation is key in the process. Seele and Gatti [ 43 ] were the only researchers who observed the phenomenon by adding the accusation as a key element in the process, a charge or claim from a third party that someone has done something illegal or wrong. Without the accusation element, the definition of the phenomenon is incomplete.

Aiming to reach the first objective, this review exposed the main definitions of greenwashing present in the literature. These definitions were presented in different conceptual perspectives, due to the multidisciplinary characteristic of the object of study. A limitation of the work found in its development was the keywords used in the search strings. Terms like ‘CSR-Wash’, ‘Decoupling’ and ‘Selective Disclosure’ may contribute to the number of articles selected in the systematic review.

To achieve the second objective, a categorization of the phenomenon was developed. This classification of greenwashing is the main academic contribution of the study, which can provide a theoretical basis for the accusatory element of the phenomenon.

In this emerging and growing green market, there are also organizations that are really green, the developed classification of greenwashing can also help to avoid unsubstantiated accusations and protect these genuine green companies.

For future research, we recommend developing procedures to measure the greenwashing in companies. The multicriteria modeling may be adequate by addressing the sorting or portfolio approach.

Availability of data and materials

Not applicable.

Abbreviations

Preferred Reporting Items for Systematic Reviews and Meta-Analyses

United States of America

Web of Science Database

Corporate social actions

Corporate social responsibility

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This study was financed in part by the Coordenação de Aperfeiçoamento de Pessoal de Nível Superior—Brazil (CAPES).

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de Freitas Netto, S.V., Sobral, M.F.F., Ribeiro, A.R.B. et al. Concepts and forms of greenwashing: a systematic review. Environ Sci Eur 32 , 19 (2020). https://doi.org/10.1186/s12302-020-0300-3

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• Green marketing
• Greenwashing
• Systematic review

What Is Greenwashing?

The disreputable and deceitful approach many companies have taken to demonstrate decarbonization remains a persistent, global challenge.

The rise in societal awareness of issues such as climate change and social injustice has led to a commensurate rise in desire for companies to prove their commitment to being more ethical, more green, and more fair. However, a tension exists: in a capitalist society, companies are incentivized to maximize profit for their shareholders at all costs rather than comb their supply chain or spend capital on cutting carbon emissions. When public or investor pressure becomes too intense for companies to ignore, should they relent and lower their profit margins to benefit society or risk the reputational damage that could prove costly? A third, more sinister route has emerged: greenwashing.

Greenwashing refers to the disingenuous and oftentimes downright deceitful approach many companies have taken to demonstrate commitment to issues such as decarbonization and biodiversity loss. While companies claim to be making huge strides towards meeting voluntary emissions reductions targets or the restoration of ecosystems, the reality is these claims are deliberately misleading or selected carefully to mask their true sustainability performance . In doing so, they can avoid public and investor pressure, while continuing unethical, unsustainable practices that allow them to maximize profits. The cost of greenwashing is paid by society, through an undermining of trust when instances are publicized and the hinderance of progress towards meeting net zero targets and broader environmental justice goals .

Examples of this behavior are abundant. Famously, fast-food chain McDonald’s switched to paper straws in 2019 in an apparent effort to reduce plastic waste; however, the new “eco-friendly” straws weren’t recyclable while the old plastic ones were. The decision led to more waste, not less. Some companies, unable to comply with external standards, have simply created their own , claiming compliance with an alternative, watered-down version of industry standards. Other companies deliberately seek out weak verifications and labels that appear impressive while being insubstantial, leading to situations where companies claiming adherence to an industry environmental standard exhibit paradoxically higher toxic emissions than companies without the label. The investment industry can be particularly culpable. Famously, former BlackRock Chief Investment Officer of Sustainable Investing Tariq Fancy described the entire sustainable investing industry as a “dangerous placebo” in a blistering set of essays.

We do, however, need to be careful not to use the “greenwashing” label where inappropriate. In 2023, activist Greta Thunberg publicly pulled out of an appearance at the Edinburgh Book Festival, citing the links of the festival’s sponsor, investment company Baillie Gifford, to the fossil fuel industry as an example of greenwashing. In this instance, the use of the term greenwashing could be considered unfair. Baillie Gifford’s investment in fossil fuel-related industries is just 2 percent compared with an industry average of 11 percent, and 5 percent of their investments are in companies whose sole business is clean energy solutions. Baillie Gifford may not be squeaky clean, but if owning any investments with links to the fossil fuel industry is enough to be labeled as a problem, there will be very few investment managers left with whom to trust our money.

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Greenwashing remains a persistent, global challenge. Prevention of greenwashing, and calling attention to clear instances of it, are crucial for preserving consumer trust and ensuring that genuine sustainability efforts are rewarded. As consumers, we need to be cautious about believing the claims companies make about their progress towards sustainability and support those that genuinely prioritize environmental responsibility over marketing ploys. Ultimately, a collective effort to unmask greenwashing can help us move toward a more sustainable future.

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News from the Columbia Climate School

Regulating Greenwashing

Steven Cohen

Sustainability sells. Consumers are attracted to products claiming to feature lower environmental impacts. Sometimes the advertising is misleading; the term for deceptive environmental advertising is “greenwashing.” Perhaps the classic case of greenwashing was Volkswagen, which at one point advertised their diesel autos as “green” while setting an elaborate software ruse that deceived environmental testing devices. As Clifford Atiyeh reported in Car and Driver magazine back in 2019:

“Volkswagen installed emissions software on more than a half-million diesel cars in the U.S.—and roughly 10.5 million more worldwide—that allows them to sense the unique parameters of an emissions drive cycle set by the Environmental Protection Agency. According to the EPA and the California Air Resources Board, which were tipped off by researchers in 2014 , these so-called “defeat devices” detect steering, throttle, and other inputs used in the test to switch between two distinct operating modes. In the test mode, the cars are fully compliant with all federal emissions levels. But when driving normally, the computer switches to a separate mode —significantly changing the fuel pressure, injection timing, exhaust-gas recirculation…While this mode likely delivers higher mileage and power, it also permits heavier nitrogen-oxide emissions (NOx)—a smog-forming pollutant linked to lung cancer—up to 40 times higher than the federal limit.”

Most examples of greenwashing are far less elaborate and not quite as blatantly illegal. The financial damage of this greenwashing scandal cost VW over $20 billion. That number does not include the reputational damage and lost stock market value caused by the deception. It resulted in an enormous turnover of VW management and nearly destroyed the company. Most examples of greenwashing are more prosaic. They might include claims that a sweater is made of recycled materials when it is not, or perhaps the material was recycled, but its reused material had been dyed in such a way that it can no longer be recycled, or its remanufacturing released toxins into the environment.

A problem with countering greenwashing is that the definition of environmental impact is not always very precise. While the Federal Trade Commission has long issued green guidelines to advise companies on good green advertising practices, it is now working on regulations setting mandatory rules on environmental marketing. According to the Wall Street Journal’ s Dieter Holger :

“Officials are seeking public comment until Feb. 21 on nonbinding guidelines for how companies can make environmental marketing claims without breaching federal laws prohibiting deceptive advertising. The FTC is asking if it should consider codifying some of the guidelines into binding rules that would empower officials to more easily seek money in court… The FTC also is seeking comments on whether the agency should provide input on 19 green terms, including “sustainable,” “carbon neutral,” “low carbon,” “carbon negative” and “net zero.”

Green marketing will be difficult to regulate because information about production processes and supply chains is far from transparent and some false claims derive more from scientific uncertainty or illiteracy than from deception. It’s also the case that all production involves environmental tradeoffs, and the fairly new academic field of life cycle analysis studies the complete cradle-to-grave impact of a production process. When one conducts a life cycle analysis, it is common to utilize models and estimates to project negative environmental impact. This creates uncertainty and imprecision. Despite these complexities, regulating green claims is still worth exploring. The purpose of greenwashing rules is not to prevent innocent errors or ignore tradeoffs but to discourage outright deception. The goal is to prevent blatant lies, such as the cigarette marketing that once touted the health benefits of smoking.

The good news about this effort is that it is an example of the public’s broad and deep support of environmental protection. Each year this becomes more embedded in our culture and influences public behavior. According to Holger :

“Companies are increasingly touting the environmental benefits of their goods and services. Sales of consumer packaged goods in North America that carried labels advertising sustainability rose to an estimated $268.9 billion in 2022 from $248.1 billion in 2021, according to NielsenIQ.”

A scholarly case for regulating green marketing was made in 2020 by Robin M. Rotman, Chloe J. Gossett, and Hope D. Goldman in a publication of the University of Missouri School of Law. In a piece focused on the marketing of “organic” products entitled “Greenwashing No More: The Case for Stronger Regulation of Environmental Marketing,” they conclude that:

“Fraudulent and deceptive environmental claims in marketing (sometimes called “greenwashing”) are a persistent problem in the United States, despite nearly thirty years of efforts by the Federal Trade Commission (FTC) to prevent it…We offer three recommendations. First, we suggest ways that the FTC can strengthen its oversight of “organic” claims for nonagricultural products and improve coordination with the USDA. Second, we argue for inclusion of guidelines for “organic” claims in the next revision of the FTC’s Guidelines for the Use of Environmental Marketing Claims…Finally, we assert that the FTC should formalize the Green Guides as binding regulations, rather than their current form as nonbinding interpretive guidance, as the USDA has done for the National Organic Program (NOP) regulations. This Essay concludes that more robust regulatory oversight of “organic” claims, together with efforts by the FTC to prevent other forms of greenwashing, will ultimately bolster demand for sustainable products and incentivize manufacturers to innovate to meet this demand.”

These scholars persuasively argue that regulating the use of these terms will increase consumer confidence in them. If consumers believe that these claims are real and then go ahead and purchase “green” products, more manufacturers will be encouraged to create products with lower environmental impacts.

It will be interesting to see how these new rules impact organizations seeking to take advantage of consumer preferences for green products. Within a typical large corporation there are a number of distinct organizational units that have differing organizational perspectives and interests related to green marketing. The marketing department will want to make the broadest, most compelling claim for being green that they can dream up. Those that operate the supply chain and manufacturing arm of the organization will focus on the technical feasibility and cost of reducing environmental impacts — including the costs of measuring those impacts and obtaining accurate information on sustainability metrics from suppliers. And then the lawyers will focus on the definition of the “green” terms included in the regulations issued by the FTC. The possibility for communication disconnects between these three groups is far from trivial, but so too is the market for green products.

Advertising, almost by definition, is not oriented toward complete honesty. Watch a drug ad on TV. Clearly, drug companies are required to state the side effects of the drug they are advertising, but the ad’s producers are doing the best they can to make sure those negative impacts are ignored. Advertising focuses on a product’s benefits, not its costs. The issue with greenwashing is preventing deception. Yes, the drug company is required to report the downside of the drug, but the drug’s benefits better be real. Green advertising could be subject to rules like drug advertising. The benefits need to be real, and the costs should also be acknowledged.

Some green advertising is difficult to fact check. A product that was once packaged in a plastic jar is now packaged in a plastic bag, and the bag says “85% less plastic than the jar we used to pack this in.” That may be true, but was the jar easier to re-use? Is the plastic in the bag more toxic than the plastic in the jar? Who knows?

Despite these difficulties, the most positive part of the greenwashing story is that people care. Consumers would like to reduce the damage caused by their consumption and there are forces in corporations that also want to reduce environmental impacts and make money from doing so. Greenwashing wouldn’t be an issue if people didn’t care about environmental quality.

Views and opinions expressed here are those of the authors, and do not necessarily reflect the official position of the Columbia Climate School, Earth Institute or Columbia University.

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How Greenwashing Affects the Bottom Line

• Ioannis Ioannou,
• George Kassinis,
• Giorgos Papagiannakis

Customers punish hypocrisy.

New research shows that when companies overcommit and/or do not deliver on promised socially responsible initiatives they damage their relationships with their customers. However, a company’s reputation for product quality or innovation may partially mitigate such a negative impact on customer satisfaction.

Consumers today face a barrage of green-friendly messaging from companies hoping to profit from increased concern over environmental issues. Unfortunately, many of these environmental promises don’t pan out. Research carried out in Europe found that 42% of green claims were exaggerated, false, or deceptive , which points to greenwashing on an industrial scale. This is dangerous ground for companies.

• II Ioannis Ioannou is an associate professor of strategy and entrepreneurship at London Business School. His research focuses on corporate sustainability and the strategic integration of ESG issues by companies and capital markets.
• GK George Kassinis is a professor of strategy at the University of Cyprus. His research focuses on corporate sustainability and stakeholder management.
• GP Giorgos Papagiannakis is an assistant professor of entrepreneurship and sustainability at the University of Peloponnese. His research interests are in the areas of corporate social responsibility, entrepreneurship, and innovation.

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Greenwashing & the First Amendment

Columbia Law Review, Forthcoming 2022

86 Pages Posted: 5 Aug 2022 Last revised: 21 Jul 2023

Amanda Shanor

University of Pennsylvania - The Wharton School

Sarah E. Light

University of Pennsylvania, The Wharton School - Legal Studies & Business Ethics Department

Date Written: July 25, 2022

Recent explosive growth in environmental and climate-related marketing claims by business firms has raised concerns about their truthfulness. Critics argue (or at least question whether) such claims constitute greenwashing, which refers to a set of deceptive marketing practices in which an entity publicly misrepresents or exaggerates the positive environmental impact of a product, service, or the entity itself. The extent to which greenwashing can be regulated consistent with the First Amendment raises thorny doctrinal questions that have bedeviled both courts and scholars, the answers to which have implications far beyond environmental marketing claims. This Essay is the first to offer both doctrinal clarity and a normative approach to understanding how the First Amendment should tackle issues at the nexus of science, politics, and markets. It contends that the analysis should be driven by the normative values underlying the protection of speech under the First Amendment in the disparate doctrines that govern these three arenas. When listeners are epistemically dependent for information on commercial speakers, regulation of such speech for truthfulness is consistent with the First Amendment and subject to the laxer review of the commercial speech doctrine. This is because citizens must have accurate information not only to knowledgably participate at the ballot box but also to have meaningful freedom in economic life itself.

Keywords: First Amendment, Climate Change, Environmental Law & Policy, Constitutional Law & Theory, Marketing, Advertising, Commercial & Securities Disclosures, Commercial Speech

Suggested Citation: Suggested Citation

Amanda Shanor (Contact Author)

University of pennsylvania - the wharton school ( email ).

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What is greenwashing and why is it a problem?

There are ways investors can spot companies misrepresenting their climate change credentials, say experts from UNSW Sydney.

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Belinda Henwood News & Content Manager +61 412 270 034 [email protected]

Financial and investment products claiming to be ethical, sustainable or environmentally responsible have experienced vast interest and growth in the past few years.

Millennials and Gen Zs are leading the demand for ethical and sustainable investment and the marketing of such financial products emotionally appeals to those worried about the future, thus driving younger investors to put their money where their values are.

However, without proper regulation of the claims made by these financial products, investors’ money might be not doing as much good as they were led to believe.

Experts from UNSW Sydney say that until rigorous regulation is in place, it is up to consumers to do their own research to assess environmental claims from financial products.

Greenwashing is a form of misleading conduct

Greenwashing is the presenting of non-climate friendly or non-environmentally friendly products as climate or environmentally friendly, says Professor Jeremy Moss from the Arts, Design & Architecture faculty.

“Greenwashing seems to be rife in the financial industry because a lot of the products available invest in companies that have dubious climate records.”

Greenwashing is a problem in many countries. Increasingly, cases are presenting in courts overseas where plaintiffs are seeking to pursue change rather than compensation or damages. However, such litigation has not taken off in Australia.

“In Europe, class action lawsuits can argue that environmental harm violates the right to life. In Australia on the other hand, we do not have a bill of rights, so we won’t see lawsuits of this kind,” says Dr Katharine Kemp from UNSW Law & Justice. 

“We are more likely to see cases being brought by Australian Securities and Investments Commission (ASIC), the Australian Competition and Consumer Commission (ACCC) and some private litigants alleging misleading conduct, or even unconscionable conduct, in respect of environmental sustainability claims.”

Greenwashed products can mislead those who care about the environment and climate change. Photo: Shutterstock.

Standards often lack substance or substantiation

Environmental, Sustainable and Governance (ESG) criteria refers to a set of criteria and standards used to inform investment choices. ESGs are often devised by investment firms or corporations themselves.

ESG is a term that is thrown around a lot in the corporate and financial world but there is no regulation or standardisation of them. The words ‘sustainable’ or ‘ethical’ in one ESG can greatly differ in meaning to another ESG.

“Financial funds that operate with an ESG can claim not to violate environmental or social concerns. However, at the moment it’s possible to put forward your fund as being sensitive to environmental concerns, even if it’s only sensitive in a very weak way,” says Prof. Moss, whose research includes projects on climate justice, the ethics of renewable energy, and the ethical issues associated with climate transitions.

“Further to this, there is no transparent way of assessing the climate records of many companies.

“The massive fossil fuel producers in particular are prone to greenwashing their activities. So when fund managers are assessing an investment choice against an ESG criterion, fossil fuel companies may appear as though they’re taking substantive action on climate change, when in fact they’re not. They are very often engaging in greenwashing.”

Watch out for vagueness and ‘bare minimum’ criteria

The ACCC and ASIC have indicated that they will pursue greenwashing this year and are seeking to introduce standardisations. However, with such regulation of ESGs a while off, values-minded investors and consumers may be wondering what to watch out for in the current financial market.

“People concerned about greenwashing should be really suspicious of vague claims,” says Dr Kemp. “If vague terminology is used and there is no specific information from the company about what their environmental or ethical claim actually means, there is reason to doubt its authenticity.”

Consumers and investors should also pay attention to whether ESGs apply a negative or positive screening approach.

Read more: Taking care of business - the private sector is waking up to nature's value

“If funds perform what they call a ‘negative screen’, then it is possible that they’re really just ruling out the most heinous and unethical practices, such as selling arms to dictators and so on,” says Prof. Moss.

Negative screening approaches look at what companies are not doing, while positive screening looks at what companies are proactive in. For example, negative screening can rule out child labour, tobacco and alcohol. Positive screening on the other hand goes further and can include companies with low carbon footprint, for instance.

But there are limitations to positive screening that consumers need to be wary of and future regulation should address, says Prof. Moss.

“Watch out for companies that are investing minimally into renewables, for instance, but still heavily contributing financially to lobby groups that actively work against climate policies.

“Until there is further regulation of sustainability claims, consumers looking for ethical or green products should look for companies that are transparent – radically transparent,” adds Dr Kemp. “Such companies are upfront about not only the good things they are doing, but also honest about any harm they still cause and how they are working to resolve that.”

Increased transparency in environmental, sustainability and governance criteria will be key to minimising greenwashing. Photo: Shutterstock.

Demand transparency and rigorous regulation

Those concerned about the environment and making ethical choices should exercise their power as citizens and consumers by demanding transparency in the corporate sector and rigorous regulation standards from ASIC and the ACCC.

“We should demand a higher standard of these funds and ask that they do a much more rigorous and thorough screen of the products they invest in,” says Prof. Moss.

“For instance, ESG funds have to be very clear and upfront about what criteria they use for claiming their products are climate-friendly.”

Professor Moss also says that regulation of ESGs needs to create a standard where it is clear to consumers not only when companies are generating a lot of emissions, but also whether those companies are trying to slow down action on climate change.

“This is very important because a company could be carbon neutral, for instance, or not emit very much, yet have a disastrous effect on the climate because of its lobbying against climate-friendly policies – these are indirect contributions to climate change that should be assessed in such ESGs.

“Most importantly, regulation will only work if it is really demanding enough and, crucially, whether it’s enforced.”

The term “Greenwashing” has entered the public discourse, usually as an accusation against companies trying to make themselves appear sustainable or environmentally friendly. Simply put, “Greenwashing” is a form of marketing that creates the perception that a company’s products, aims or policies are “green”. This can take on a variety of different forms, from changing the name or label of a product to advertising campaigns highlighting the eco-friendliness of a particular business.

Since the 1980s, an increasing number of businesses have employed Greenwashing methods in response to a growing demand for eco-friendly goods and services. The problem with Greenwashing is that all too often, the efforts to make a product appear more “green” does not entail it is better for the environment (in fact it can sometimes have the adverse effect) : the lack of standards and regulations around what constitutes eco-friendliness means that pretty much anything can be marketed as “green”. In this article, we aim to explore Greenwashing through the lens of businesses and consumers, starting with a brief explanation of the context that made it a common practice.

The Green Wave

In the last decades, the idea of a greener planet has gained traction in the popular imaginary. It started with companies in the 1980s that realised the importance of a green image, in response to civil society movements that raised awareness of some industries’ impact on the environment.

The most common tool for Greenwashing, still used today, is advertising. Companies like DuPont tried to present a green image with advertisements, which nowadays seem hilarious to a critical viewer.

Perhaps unexpectedly , this practice of greenwashing through advertising campaigns was quite successful. Constant spamming of advertisements made people aware of environmental issues, and resulted in polarizing opinions.

The use of Greenwashing advertisements raised awareness of environmental issues, which strengthened the green movement. On the other hand many activists claim that the companies’ initiatives are creating a misleading perception of the company.

As a result, the process of greenwashing has become more complex but hasn’t been become more transparent. In fact, it is not the first time that misleading advert campaigns obscure the actual impact of a commodity. In the 1950’s cigarettes and alcohol were frequently advertised and presented as healthy. Strangely enough, it became a social standard to smoke the best cigarettes.

60 years later the image changed and in most of the countries advertisements for cigarettes are forbidden. But we all know how many campaigns and scientific proof it took to change this image, that was intentionally created by the tobacco lobby.

It is just as hard to shop yourself to sustainability as it is to smoke yourself to a healthy lung.

Selling the Green Idea

Most companies want to reach their customers in a very individual way, and craft their adverts to target a specific demographic. Greenwashing is no exception. Since environmental concerns exist in most Western society, it has become strategically useful for many companies to present a green image.

A good example is the UN Climate Conference 2009 where several well-known brands (Coca Cola, BMW, DuPont..) took the opportunity to present a greener image of themselves. BMW for example , sent hydrogen powered cars to the climate conference. But then, several newspapers reported that immediately after the conference the further development of these cars had been stopped. BMW denies that and says that there would be further development, but no production anytime soon.

A company’s green image is also crafted by the design of the products we buy. It is common for many supermarket chains to change the package of a product to a design that looks ‘greener’ (for instance changing the bag from white to a brown recycled-style look). Many brands also have their own ‘green seals’ (certificates of eco-friendliness) put on certain products. Since there are no strict rules or regulations of what sustainability, green or eco is, these words have effectively lost any meaning, and can be used instrumentally by companies to appeal to a certain target group.

The German brewery Krombacher had to make that experience . In 2002, Krombacher started a campaign together with WWF. The idea was to donate for the protection of rainforests for every beer crate. What was at the beginning a simple PR strategy ended up changing the whole image of the company.

In the following months they received countless complaints and requests about how the company itself is contributing to environmental protection. However, the campaign with WWF was the only thing that was behind this green image.

Little by little, the company started to work on other aspects of environmental protection in order to keep this green image. As a result, this pressure from civil society led the brewery to be more eco-friendly than it was before 2002. Still, eco-friendliness is not their priority. As one of the biggest German breweries it was just not possible to provide all of the barley bio-quality, they say .

In a way, the “green wave” of the society is making businesses greener even though this is rarely their intention. At the end of the day, the question remains if the intention or the result is what counts.

The Quick Green Fix

Jane Hoffman writes that Greenwashing is “what happens when a hopeful public eager to behave responsibly about the environment is presented with ‘evidence’ that makes an industry seem friendly to the environment”. Her point is that the practice of Greenwashing, and the problems it entails, only exists because there is a demand from us as consumers. This demand for superficially ‘green’ products is itself a product of our times. We don’t have the energy or inclination to investigate whether a product we are buying is actually eco-friendly, we just want the immediate gratification of knowing we are contributing positively to the issue.

This is the criticism that philosopher Slavoj Zizek makes at consumers who take a ‘quick green fix’, for instance by buying fair trade coffee from Starbucks. He argues that what companies like Starbucks allow you to do is to ‘be a consumerist without a bad conscience, because the price […] for fighting consumerism, is already included in the commodity…I think it’s the ultimate form of consumerism’. Zizek would thus consider Greenwashing to be part of the capitalist ideology, because it provides the means for environmentally-conscious consumers to keep participating in the system they are criticizing.

https://youtu.be/xxJ6PmNOgb0

As a consumer, the only way to avoid getting “Greenwashed” is to investigate which companies are truly ‘green’ and which ones are merely pretending. This involves reading the labels of clothes and food, doing some research online, and asking uncomfortable questions. Resources like Ecolabels Index , which tracks almost 500 Ecolabels across 200 countries, can make this task easier, but the sad reality is that no current ‘green standard’ (Organic, FairTrade, vegan…) can itself guarantee the eco-friendliness of a product. We would like to see international organizations (such as the EU or the UN) develop transparent standards for eco-friendliness that truly reflect the impact of the commodities.

Praying to the Green God

In this light, Greenwashing is a consequence to consumers’ demand for ‘greener’ products, and companies’ reaction to that. But it is not the companies’ primary aim to be green. In many industries it is not even possible to combine sustainability and maximize profit.

Capitalism has proven remarkably able to adapt to the demands of consumers, and the call for greener products from civil society is no exception. Greenwashing has effectively co-opted the concepts of sustainability and eco-friendliness into modern business practices, with mixed results. In some cases, such as the Krombacher brewery, it has incentivized companies to become actually greener, with positive results for the environment. But most of the time, companies like BMW have only gotten better at masquerading, and consumers have been only too happy to enjoy the ‘green opium’ they provide.

Written by Milan Maushart and Mischa Snaije

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Explainer: What Is Greenwashing and How to Avoid It?

As people around the world become more aware of the importance of their daily choices and purchases, many businesses, too, are becoming more sustainable in how they operate to gain favour with consumers. In theory, this is a good thing, but many have simply put up a facade of sustainability while they continue to engage in activities that cause more waste or greenhouse gases. This is called ‘greenwashing’ – but what exactly is it and how can you avoid companies that engage in it?

What Is Greenwashing?

Greenwashing is essentially when a company or organisation spends more time and money on marketing themselves as being sustainable than on actually minimising their environmental impact. It’s a deceitful advertising method to gain favour with consumers who choose to support businesses that care about bettering the planet. Greenwashing takes up valuable space in the fight against environmental issues, like climate change, plastic ocean pollution, air pollution and global species extinctions. 

The term “greenwashing” was coined by environmentalist Jay Westerveld in 1986 in an essay criticising the irony of the “save the towel” movement in hotels at the time. He noticed the vast amount of waste he had come across throughout the rest of the hotel, where there were no visible signs of efforts being made to become more sustainable. He said that instead, the hotel was simply trying to reduce costs by not having to wash towels as much but while trying to market it as being eco-friendly. 

Why Do Companies Engage in Greenwashing?

It’s simple – being seen as ethical drives profitability. A report by McKinsey found that Gen Z (people born roughly between 1996 and 2010) are more likely to spend money on companies and brands seen to be ethical. Another, Nielson’s Global Corporate Sustainability Report , found that 66% of consumers would spend more on a product if it comes from a sustainable brand, and that jumps to 73% among millennials. Therefore, companies have a financial incentive to be more socially conscious, or at least appear to. 

However, another reason that companies engage in greenwashing is far less insidious – they simply don’t know that they’re doing it. Many companies just don’t have the expertise to know what is truly environmentally beneficial, and what isn’t. In Australia , a company switched to using “biodegradable” plastic, which technically didn’t fully degrade, but instead just breaks down into smaller parts unless it’s processed in a digester specifically designed to create the conditions for biodegradation. What the company actually needed was a compostable bag, which is a different thing entirely. The consumer affairs watchdog in the country actually fined them to stop selling the product as it was completely false.

It is very likely that this company intended to be eco-friendly, but was caught out due to their lack of research on what actually constitutes as sustainable materials. This is why it’s so important for companies to do meaningful research on how to be sustainable and apply it to all stages of their operations, not only what consumers see. 

You might also like: 10 Companies Called Out For Greenwashing

What Are Some Examples of Greenwashing?

Unfortunately, there are many examples of organisations engaging in greenwashing. A classic example is Volkswagen , who admitted to cheating emissions tests by fitting various vehicles with a “defect” device, software which could detect when it was undergoing an emissions test and altering the performance to reduce the emissions level. All of this was while it was touting the low-emissions and eco-friendly features of its vehicles in marketing campaigns. In actuality, these engines were emitting up to 40 times the allowed limit for nitrogen oxide pollutants. 

Another is the fossil fuel giant BP, who changed their name to Beyond Petroleum and put solar panels on their gas stations, and then came under fire for their green misdirection . 

In 2018, Nestlé released a statement saying that it had “ambitions” for its packaging to be 100% recyclable or reusable by 2025. However, environmental groups were quick to point out that the company hadn’t released clear targets, a timeline to accompany its ambitions or additional efforts to help facilitate recycling by consumers. Greenpeace reacted to this by releasing its own searing statement , in which it said, “ Nestlé’s statement on plastic packaging includes more of the same greenwashing baby steps to tackle a crisis it helped to create. It will not actually move the needle toward the reduction of single-use plastics in a meaningful way, and sets an incredibly low standard as the largest food and beverage company in the world.” In 2020, Nestlé, along with Coca-Cola and PepsiCo, were named the world’s top plastic polluters for the third year in a row. 

Finally, in 2017, Walmart paid USD$1 million to settle claims that it sold plastics misleadingly touted as being eco-friendly. In the US, California state law bans the sale of plastics labeled as “compostable” or “biodegradable,” as environmental officials have determined such claims are misleading without disclaimers about how quickly the product will biodegrade in landfill.

Half of the world’s disposable plastic has been produced in the last 16 years , and 91% of the plastic produced globally is not recycled. This is why companies making claims to be making “reusable plastic” are so harmful – we need to be creating less plastic. It’s all well and good to be creating plastic that is recyclable but the above statistics show that this is meaningless if this plastic is still going to end up in a landfill. Many types of plastic are difficult to recycle, either because countries don’t have the necessary machinery or because people simply don’t have the time/ will to recycle their goods. 

Fortunately, some countries are starting to crack down on marketing that greenwashes. In 2019, Norway’s Forbrukertilsynet (Consumer Authority) ruled last year that fast fashion brand H&M was under investigation for its supposedly ethical ‘Conscious’ collection. H&M and other fast fashion retailers are renowned for exploiting the vagueness of green terminology to appear more environmentally conscious and sell more clothes. This is a problem, because fast fashion is one of the biggest polluters on the planet, with more than £140 million worth of clothing ending up in UK landfills every year.

You might also like: Fast Fashion: Its Detrimental Effect on the Environment

How Can You Spot Greenwashing and Avoid It?

• Watch out for “fluffy language,” ie. words or terms with no clear meaning (eg “eco-friendly,” “produced sustainably,” etc)
• Declarations from a company that it is slightly greener than the rest, even if the rest are pretty terrible (eg. BP placing solar panels on its gas stations and saying that it is “working to be more sustainable”)
• “Greening” dangerous products to make it seem safe (eg, “eco-friendly” cigarettes)
• Using jargon or information that only a scientist could check or understand
• Providing no proof of a claim
• Presenting totally fabricated claims or data as fact
• Emphasising one tiny green attribute when everything else is dirty (eg again, BP and their solar panels)
• Companies that aren’t transparent or open, and don’t admit to making mistakes 

Besides watching out for this behaviour from companies, there are also some online tools and search engines, such as Project Cece and Ethical Made Easy , which can help you to find sustainable brands, and avoid ones that simply pretend to be sustainable. 

You might also like: ESG Investing in 2022: A Rising Trend Amid Greenwashing Concerns

The sustainable landscape today is not like in Jay Westerveld’s time in the 80s – we have the means to research brands we invest our time and money in. We have immense power as consumers; we create the landscape that businesses operate in, so where our money goes, their focus goes. We need to make sure that this focus goes towards sustainability. Businesses cannot get away with greenwashing anymore; as the climate crisis accelerates, we simply can’t waste any time in shifting to more eco-friendly practices.

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What Is Greenwashing?

Ensure that you aren't making false claims that your company or products are environmentally friendly, which can damage customers' trust.

Table of Contents

Consumers now expect businesses to take proactive measures to protect the planet and people, which means brands must demonstrate their commitment to sustainability in a tangible way. According to estimates from Statista , 44 percent of consumers are more likely to buy from a brand that prioritizes sustainability. That means brands that fail to do so are potentially leaving money on the table. 

However, exaggerating your commitment to sustainability can backfire and cause lasting damage to your brand’s reputation. By misrepresenting what your company is doing to protect the environment and build ethical supply chains, you could lose your customers’ trust for years to come. This practice, known as greenwashing, should be avoided at all costs.

What is greenwashing?

Greenwashing is when an organization invests in marketing campaigns that position the company as environmentally friendly rather than actually minimizing its environmental impact. It’s a deceitful marketing gimmick used by companies to exaggerate their environmentally friendly actions. It is intended to mislead consumers who prefer to buy goods and services from environmentally conscious brands.

Where did the term “greenwashing” originate?

Environmentalist Jay Westerveld coined the term “greenwashing” in 1986, in a critical essay inspired by the irony of the “save the towel” movement in hotels that had little impact beyond saving hotels money in laundry costs. The idea emerged in a period when most consumers received their news primarily from television, radio and print media, so they couldn’t fact-check the way they could today.

Companies that have engaged in greenwashing on a wide scale have made headlines over the years. In the mid-’80s, for example, oil company Chevron commissioned a series of expensive television and print ads to broadcast its environmental dedication. But while the now-infamous “People Do” campaign ran, Chevron was actively violating the Clean Air Act and Clean Water Act , as well as spilling oil into wildlife refuges.

Chevron was far from the only corporation making outrageous claims. In 1991, chemical company DuPont announced its double-hulled oil tankers with ads featuring marine animals prancing in chorus to Beethoven’s “Ode to Joy.” It turned out that the company was the largest corporate polluter in the U.S. that year.

How greenwashing harms a brand’s reputation

Greenwashing has changed over the past 20 years, but it’s certainly still around. It’s easy to see why marketers are enthusiastic: According to Statista , 64 percent of Gen Zers and 59 percent of millennials are willing to spend more on a product if it comes from a sustainable brand. But greenwashing can also have serious consequences, including the following:

• Loss of consumer trust: Lost consumer trust is hard to rebuild. Even a simple mistake could require years of effort to undo. Estimates from Statista suggest that when consumers lose trust in a brand, up to 40 percent stop buying from that company and begin shopping with competitors. Therefore, being honest and accurate about your sustainability efforts is vital to your bottom line.
• Lawsuits: Brands that are caught misrepresenting their sustainability efforts could be subject to a specific type of false advertising lawsuit known as “greenwashing litigation.” It’s not only outright lies that can make a company a target for these types of lawsuits; inflated claims about sustainability efforts could also put a business at risk. The costs of these lawsuits alone are enough reason to make sure you’re being precise when describing your company’s sustainable practices and corporate social responsibility.
• Lost partnership opportunities: Valued partnerships that improve your business’s sustainability may be harder to come by after you’ve been called out for greenwashing. Recovering from such an episode is already difficult and requires partnerships with advocacy organizations, nongovernmental organizations and other groups that can help you demonstrate a real commitment to sustainability and righting past wrongs. But if you’ve had a public greenwashing scandal, you may find it difficult to earn the trust of those same institutions you need to work with to repair your brand reputation.

These consequences can be so steep that it’s never worth it to engage in greenwashing. 

How to avoid greenwashing

Here are 10 basic greenwashing tactics to avoid:

• Fluffy language: Don’t throw around words or terms with no clear meaning (e.g., “eco-friendly” or “natural”).
• Green products versus dirty company: Watch out for hypocrisies, such as efficient light bulbs made in a factory that pollutes rivers.
• Evocative pictures: Don’t use branding images that give an unjustified green impression (e.g., flowers blooming from exhaust pipes).
• False designations: Look out for obvious attempts to “green” a dangerous product to make it seem safe. (Eco-friendly cigarettes, anyone?)
• Imaginary friends: Don’t use a label that looks like a third-party endorsement but is actually made up.
• Outright lies: Never use totally fabricated claims or data.

There are plenty of socially responsible businesses telling their environmental stories to the world, and even some that aren’t but should be. Incidents of “pure greenwash” — purposeful untruths about a product’s impact — aren’t widespread. However, many examples come close. 

Some corporate buzzwords commonly used to greenwash could be seen as a “slippery slope,” and companies should educate their marketers on the ethics of green branding. This sort of training can help avoid the unintentional greenwashing that comes from exaggerating or misrepresenting your sustainability practices out of an innocent-but-overeager effort to spread the word.

Tips to avoid inadvertent greenwashing

Use the following strategies to ensure that your company is not greenwashing.

• Make your claims clear and easy to understand. Include details such as specific units of measurement (e.g., “70% organic cotton” rather than “made with organic cotton”) and specific certifications and verifiable endorsements from credible third-party eco-organizations, such as the Sierra Club.
• Back up your sustainability claims with data. Keep current data available, and update it on your website and anywhere else you make sustainability claims. Only use data that can be verified. If possible, include credible third-party certification from sources such as the Carbon Trust Standard, the Forest Stewardship Council, the Rainforest Alliance, or Energy Star.
• Compare apples to apples. When comparing your product’s sustainability to a competitor’s, make sure they are the same product type so you’re not misleading consumers.
• Clean up your operations. If you want to market your products as eco-friendly, you need to walk the walk by making sustainability part of your business model . Institute sustainable practices in your manufacturing, waste disposal and distribution operations.
• Be honest about your brand’s sustainability practices and plans. Inform consumers about how green your individual products and your company’s sustainability practices are. When discussing plans or goals, be specific about your targets and timelines so consumers can hold you accountable.
• Make sure images on ads and packaging are not misleading. Don’t use the color green or images from nature, like trees and flowers, to imply that your products or brand are eco-friendly if that’s not the case.

Difference between green marketing and greenwashing

There’s a fine line between green marketing and greenwashing. Unlike greenwashing, green marketing is when companies sell products or services based on legitimate environmental positives. 

Green marketing is generally practical, honest and transparent, and it means that a product or service meets the following criteria:

• It’s manufactured in a sustainable fashion.
• It’s free of toxic materials or ozone-depleting substances.
• It’s recyclable or produced from recycled materials.
• It’s made from renewable materials.
• It’s not made of materials harvested from a protected area or that harm threatened or endangered species with their harvest.
• It’s not manufactured with slave labor or by workers who are not paid fairly.
• It does not use excessive packaging.
• It’s designed to be repairable rather than disposable.

However, it’s easy for green marketing to translate to greenwashing in practice when an organization doesn’t live up to the sustainable business practices. “Eco-friendly,” “organic,” “natural” and “green” are just some of the widely used labels that can be confusing and misleading to consumers. 

If you’re ready to slap some grass on your logo, be transparent with customers about your company’s practices and have information readily available to back up your claims.

Transparency and corporate social responsibility

“Greenwashing is actually in a corporation’s best interest,” Deandra Jefferson, former office manager for a sustainability organization that she requested go unnamed, said in an interview with Business News Daily. “Although the concept of corporate social responsibility exists, it is very rare that corporations actually live up to [it], and when they do, it’s a surface-level effort to make themselves look good.”

In other words, greenwashing benefits a corporation only when it successfully deceives its customers. Transparency can bridge the gap between artificial and genuine concern for the environment.

One example of transparency is exhibited by outdoor clothing retailer Patagonia. Unlike most companies, Patagonia doesn’t sugarcoat its use of chemicals or the fact that it leaves a footprint. The company’s sustainability mission is described as a “struggle to become a responsible company.”

“We can’t pose Patagonia as the model of a responsible company,” its website reads. “We don’t do everything a responsible company can do, nor does anyone else we know. But we can tell you how we came to realize our environmental and social responsibilities and then began to act on them.”

Avoiding greenwashing begins with honesty

It’s important to put your best foot forward when it comes to sustainable practices, and it’s understandable that you’d want to communicate these efforts to your customers. However, it’s important not to overstate the impact of your work, because even seemingly innocent exaggerations could have harmful consequences for your brand. Do your best to tell your company’s sustainability story and avoid greenwashing.

Tejas Vemparala and Jennifer Dublino contributed to this article. Source interviews were conducted for a previous version of this article.

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What Is Greenwashing?

• How It Works
• How the FTC Protects Consumers

The Bottom Line

• Marketing Essentials

Greenwashing: Definition, How It Works, Examples, and Statistics

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

Xiaojie Liu / Investopedia

Greenwashing is the process of conveying a false impression or misleading information about how a company’s products are environmentally sound. Greenwashing involves making an unsubstantiated claim to deceive consumers into believing that a company’s products are environmentally friendly or have a greater positive environmental impact than they actually do.

In addition, greenwashing may occur when a company attempts to emphasize sustainable aspects of a product to overshadow the company’s involvement in environmentally damaging practices. Performed through the use of environmental imagery, misleading labels, and hiding tradeoffs, greenwashing is a play on the term “whitewashing,” which means using false information to intentionally hide wrongdoing, error, or an unpleasant situation in an attempt to make it seem less bad than it is.

Key Takeaways

• Greenwashing is an attempt to capitalize on the growing demand for environmentally sound products.
• Greenwashing can convey a false impression that a company or its products are environmentally conscious or friendly.
• Critics have accused some companies of greenwashing to capitalize on the socially responsible or environmental, social, and governance (ESG) investing movement.
• Genuinely green products or businesses back up their claims with facts and details.

How Greenwashing Works

Also known as “green sheen,” greenwashing is an attempt to capitalize on the growing demand for environmentally sound products, whether that means they are more natural, healthier, free of chemicals, recyclable, or less wasteful of natural resources .

The term originated in the 1960s, when the hotel industry devised one of the most blatant examples of greenwashing. They placed notices in hotel rooms asking guests to reuse their towels to save the environment. The hotels enjoyed the benefit of lower laundry costs.

More recently, some of the world’s biggest carbon emitters, such as conventional energy companies , have attempted to rebrand themselves as champions of the environment. Products are greenwashed through a process of renaming, rebranding, or repackaging them. Greenwashed products might convey the idea that they’re more natural, wholesome, or free of chemicals than competing brands.

Companies have engaged in greenwashing via press releases and commercials touting their clean energy or pollution reduction efforts. In reality, the company may not be making a meaningful commitment to green initiatives . In short, companies that make unsubstantiated claims that their products are environmentally safe or provide some green benefit are involved in greenwashing.

Products that are actually eco-friendly can benefit from green marketing , which highlights the environmental benefits of the product and the company making it. However, if a company’s green marketing activities are found to be false, then the company may be accused of greenwashing and be hit with penalties, bad press, and reputational damage, and be forced to clean up the damaged environment .

How the Federal Trade Commission (FTC) Helps Protect Consumers

Of course, not all companies are involved in greenwashing. Some products are genuinely green. These products usually come in packaging that spells out the real differences in their contents from competitors’ versions.

The marketers of truly green products are only too happy to be specific about the beneficial attributes of their products. The website for Allbirds, for example, explains that its sneakers are made from merino wool, with laces made from recycled plastic bottles, and insoles that contain castor bean oil. Even the boxes used in shipping are made from recycled cardboard.

The U.S. Federal Trade Commission (FTC) helps protect consumers by enforcing laws designed to ensure a competitive, fair marketplace. The FTC offers guidelines on how to differentiate real green products from the greenwashed:

• Packaging and advertising should explain the product’s green claims in plain language and readable type in close proximity to the claim.
• An environmental marketing claim should specify whether it refers to the product, the packaging, or just a portion of the product or package.
• A product’s marketing claim should not overstate, directly or by implication, an environmental attribute or benefit.
• If a product claims a benefit compared with the competition, then the claim should be substantiated.

Examples of Greenwashing

The FTC offers several illustrations of greenwashing on its website, which details its voluntary guidelines for deceptive green marketing claims. Below is a list of examples of unsubstantiated claims that would be considered greenwashing.

• A plastic package containing a new shower curtain is labeled “recyclable.” It is not clear whether the package or the shower curtain is recyclable. In either case, the label is deceptive if any part of the package or its contents, other than minor components, cannot be recycled.
• An area rug is labeled “50% more recycled content than before.” In fact, the manufacturer increased the recycled content to 3% from 2%. Although technically true, the message conveys the false impression that the rug contains a significant amount of recycled fiber.
• A trash bag is labeled “recyclable.” Trash bags are not ordinarily separated from other trash at the landfill or incinerator, so they are highly unlikely to be used again for any purpose. The claim is deceptive because it asserts an environmental benefit where no meaningful benefit exists.

What Are Some Other Types of Greenwashing?

One common form of greenwashing is to include misleading labeling or bury environmentally unsound practices in the fine print. This can include use of terminology such as “eco-friendly” or “sustainable,” which are vague and not verifiable. Imagery of nature or wildlife can also connote environmental friendliness, even when the product is not green. Companies may also cherry-pick data from research to highlight green practices while obscuring others that are harmful. Such information can even come from biased research that the company funds or carries out itself.

How Can You Spot Greenwashing?

If greenwashing is going on, there is often no evidence to back up the claims that a company is making. Sometimes verifying can be difficult, but you can look to third-party research and analyst reports, as well as check the product’s ingredients list. True green products will often be certified by an official vetting organization, which will be clearly labeled.

Why Is Greenwashing Bad?

Greenwashing is deceitful and unethical because it misleads investors and consumers who are genuinely seeking environmentally friendly companies or products. Often, green products can be sold at a premium, making them more expensive, which can lead consumers to overpay. If greenwashing is revealed, it can seriously damage a company’s reputation and brand.

Environmentalism and environmental, social, and governance (ESG) criteria have become important considerations for some investors. This has led many businesses to focus on becoming more eco-friendly by reducing waste, cutting emissions, recycling, and using renewable energy , among other efforts. However, some companies can instead cut corners and claim that they are doing these things to gain favor when, in reality, they are not. Greenwashing is an unethical practice that can mislead investors and the general public.

Allbirds. “ Our Materials: Wool .”

National Archives, Code of Federal Regulations. “ Title 16—Commercial Practices: Chapter I, Subchapter B, Part 260, § 260.3 .”

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Greenwashing: How companies are putting up an eco-friendly front

Greenwashing dupes consumers into spending their hard-earned green on unsustainable and unethical products.

Alexandra Chan

Sustainability has become a marketing tool. Greenwashing tricks customers into spending money on unsustainable products under false pretenses. (Staff Illustration by Alexandra Chan)

Sam Brinton , Beauty & Style Editor May 6, 2021

This past Earth Day, I opened my email expecting the usual obnoxious junk and spam. What I received was something that annoyed me even more: Earth Day marketing emails. Why were companies like Forever 21 and YesStyle trying to get me to consume their less-than-green products on a holiday based entirely around environmentalism? I was peeved, but I should have expected it. After all, using environmental consciousness as a marketing tactic is something companies do all the time, through a misleading practice known as greenwashing.

Greenwashing is defined by Merriam-Webster as “expressions of environmentalist concerns especially as a cover for products, policies, or activities.” In other words, it’s when companies utilize eco-friendly rhetoric to try and sell products and cover up the fact that they are actually far from environmentalists.

Greenwashing can take on many different forms, ranging from vague, misleading or unproven claims, to downright lying about receiving environmental certifications like ENERGY STAR . Sometimes, companies even make up certifications that don’t even actually exist or mean anything — just saying “100% natural” can trick unwitting consumers, even if the label has not actually been evaluated or defined by a qualified third party.

A prime example of greenwashing in action — right down to the literally green-hued label — is Coca-Cola Life . The soft drink was Coca-Cola’s 2013 attempt at an allegedly environmentally friendly and health-conscious product. Marketing for the beverage featured smiling picnickers lounging in a lush field of green grass and wildflowers, evoking an idyllic image of nature meant to convince consumers that this sugary soda is actually great for their bodies and the environment. The plastic bottle (dubbed the Plantbottle) is made of recyclable material, after all!

The reality? That plastic probably ended up polluting plenty of environments, considering Coca-Cola was ranked by Greenpeace as the leading plastic polluter in 2019, and produces around 100 billion single-use plastic bottles a year. Coke has also resisted legislation intended to force them into adopting more environmentally friendly practices, like when they pushed the European Union to abandon a measure that would have required caps to be attached to bottles in order to reduce marine pollution.

Coke Life wasn’t even Coke’s only foray into greenwashing — after all, the corporation often runs ads depicting happy polar bears sipping soda in the Arctic, while simultaneously contributing to the environmental destruction that is threatening the habitats of those bears’ real-life counterparts.

At the end of the day, it is important for us to remember that we as individual consumers don’t bear the brunt of the responsibility for the climate crisis. That inglorious prize goes to the corporations and government leaders whose exploitation and inaction have contributed to the bulk of the environmental damage.

But this doesn’t mean that we shouldn’t make an effort to ensure that we are doing it as ethically and sustainably as we possibly can. It can be a difficult task — and it’s made even more challenging by greenwashing.

So how can we keep ourselves from getting fooled?

As time-consuming as it can be, the best answer is to do your own research and view all claims with a skeptical eye. If a company uses undefined labels like “sustainable” or “100% eco-friendly,” don’t take them at face value. If they aren’t backed up by concrete evidence, they are likely just lip service.

As for products claiming to hold third-party certifications like ENERGY STAR or Leaping Bunny, you can visit their websites to certify that the stamp of approval is legit.

Don’t let aesthetics trick you — eco-themed packaging isn’t an indicator of actual sustainability. Look into the backgrounds of brands. Websites like Ethical Consumer can reveal the unsustainable skeletons in a corporation’s closet.

Next time you come across a product suspiciously claiming to be eco-friendly, take a closer look. Chances are, there’s a reality behind it that’s less than green.

Email Sam Brinton at [email protected] .

• climate change
• environmentalism
• greenwashing
• plastic pollution
• sustainability

Sam Brinton is a junior studying Journalism and Metropolitan Studies. She loves New York Times crossword puzzles, clarinet and playing Nintendo games to...

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Home — Essay Samples — Sociology — Marketing and Advertising — Sins And Problems Of Greenwashing

The Use of Greenwashing in Advertising and Its Effects

• Categories: Marketing and Advertising Sustainability

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Introduction, greenwashing in advertisements, works cited, simple green.

• Barry, Keith. “More American Drivers Want Electric Cars, AAA Survey Says.” Consumer Reports, 8 May 2018, www.consumerreports.org/hybrids-evs/more-american-drivers-want-electric-cars-aaa-survey-says/.
• Baumgartner, Jennifer. It’s All in the Details. 2012. English 101C. Spring 2020, edited by Julie Ashmore, pp. 82-88
• Cherry, Kendra. “How Does the Color Green Impact Mood and Behavior?” Verywell Mind, Verywell Mind, 24 Sept. 2019, www.verywellmind.com/color-psychology-green-2795817.
• Corbett, Julia B. “A Faint Green Sell: Advertising And The Natural World” Enviropop. 2002.
• D'Alessandro, Nicole. “5 'Green' Products That Aren't As Eco-Friendly As You Thought.” EcoWatch, EcoWatch, 27 June 2016, www.ecowatch.com/5-green-products-that-arent-as-eco-friendly-as-you-thought-1881912896.html.
• EWG. “Simple Green Concentrated All-Purpose Cleaner Cleaner Rating.” EWG, EWG, 19 June 2018, www.ewg.org/guides/cleaners/1545-SimpleGreenConcentratedAllPurposeCleaner
• Kiser, John, and Mark Essery. “Is There a Target Market for Electric Vehicles?” IPSOS, www.ipsos.com/sites/default/files/2017-04/ipsos-marketing-target-market-electric-vehicles.PD__0.pdf.
• Mws. “Tesla and the Environmental Impact of Lithium-Ion Batteries.” Technology and Operations Management, Alumni, 13 Nov. 2017, digital.hbs.edu/platform-rctom/submission/tesla-and-the-environmental-impact-of-lithium-ion-batteries/.
• O’Neill, Charles. “The Language of Advertising.” Business Advertiser, 2011 English 101C. Spring 2020, edited by Julie Ashmore, pp. 77-81
• Rouse, Margaret. “What Is Greenwashing? - Definition from WhatIs.com.” WhatIs.com, TechTarget, 19 Sept. 2007, whatis.techtarget.com/definition/greenwashing.

Should follow an “upside down” triangle format, meaning, the writer should start off broad and introduce the text and author or topic being discussed, and then get more specific to the thesis statement.

Provides a foundational overview, outlining the historical context and introducing key information that will be further explored in the essay, setting the stage for the argument to follow.

Cornerstone of the essay, presenting the central argument that will be elaborated upon and supported with evidence and analysis throughout the rest of the paper.

The topic sentence serves as the main point or focus of a paragraph in an essay, summarizing the key idea that will be discussed in that paragraph.

The body of each paragraph builds an argument in support of the topic sentence, citing information from sources as evidence.

After each piece of evidence is provided, the author should explain HOW and WHY the evidence supports the claim.

Should follow a right side up triangle format, meaning, specifics should be mentioned first such as restating the thesis, and then get more broad about the topic at hand. Lastly, leave the reader with something to think about and ponder once they are done reading.

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Greenwashing: Full Environmental Sustainability? Essay (Critical Writing)

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These days there is a growing pressure towards companies to alter their operations to make them more environmentally sustainable. Some people even claim that such changes can prove to be beneficial for organizations themselves bringing additional profit and enhancing brand recognition. However, as more and more companies employ greenwashing strategies, many experts start to raise doubts whether full environmental sustainability is accessible, especially, if business goals are prioritized.

Businesses have more resources than individuals; therefore, they have more responsibilities. They should care for their customers providing them with products of high quality which are safe to use and for their employees ensuring that they have comfortable working conditions and stable income. In recent decades, there have been growing acknowledgement that companies are also responsible for the impact they have on the environment. However, it is essential to remember that businesses main goal is to be financially profitable. Otherwise, they would not be able to continue their operations for a long time. Therefore, organizations should balance their social responsibilities with seeking financial success. Taking considerable environmental action can, however, be too costly to remain within this framework (Eisenstein, 2014). As Eisenstein puts it, “if your company is going to make a significant step toward sustainability, it probably won’t make business sense, at least not in any way that can be predicted or quantified” (2014, para. 9). Hence, to make such actions, businesses should be guided by other goals rather than profit – it must be about caring, desire to contribute and making a change.

For companies, to be 100% sustainable and ethical would mean that each time they are presented with a decision, they would make people or nature their priority. However, it is difficult to imagine that such a company can be financially successful maintaining a considerable market share for a long time. There are many aspects to manufacturing and delivering products, and it is difficult to make all of them entirely eco-friendly. For instance, while some claim that plant-based milks are more sustainable than regular milk some of them require a lot of water to be produced. Research and constant innovations to create eco-friendly products and packaging, altering production processes to make them more sustainable or giving regular donations to offset its impact, this all demands significant investments and is difficult to achieve without substantial revenue.

LEGO can be an example of a company that has already established a worldwide reputation and having acquired considerable financial resources successfully engages in environmental-protection activities. For instance, they are putting a lot of efforts into reducing their CO2 impact by installing renewable-energy systems and altering their production processes (LEGO, n.d.a). Moreover, they are also investing into research in sustainable materials aiming to make all their toys fully sustainable by 2030 without sacrificing their quality (LEGO, n.d.b). In 2018, they have introduced a range of elements made from plant-based sources, and the organization claims that although it represents ” just 2% of the 3,600 elements available for designers” it is an important step forward (LEGO, n.d.b, para. 4). However, this figure shows that despite all efforts the company puts into environmental protection, they still have a lot to improve. Moreover, they are not ready to sacrifice their quality and customers satisfaction for sustainability. Their sales continue to increase but it most likely happens due to various growth initiatives (LEGO, 2020). Hence, while they show increasing respect towards nature protection, they also employ practical expansion strategies. Taking actions to support the environment can undoubtfully have a positive effect on LEGOs reputation, but this process will also demand a lot of resources that are not easy to compensate.

Hence, making a change requires that companies act not for the profit but out of devotion and sincere care for the environment. Taking steps towards being more environmentally responsible cannot be a fast process and full sustainability does not seem achievable yet. However, what matters is that companies do their best to engage in this process making at least small steps towards a better future for our planet.

Eisenstein, C. (2014). Let’s be honest: real sustainability may not make business sense. The Guardian . Web.

LEGO (2020). The LEGO Group Annual Report 2019 . Web.

LEGO (n.d.a). Reducing our CO2 impact. Web.

LEGO (n.d.b). Sustainable materials . Web.

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A Critical Perspective on Greenwashing Under the Roof of Corporate Environmentalism

• First Online: 03 January 2022

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• Mine Bertan Yılmaz 9 &
• Banu Baybars 9  

Part of the book series: Palgrave Studies of Marketing in Emerging Economies ((PSMEE))

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Greenwashing occurs when companies give the wrong impression that their products are environmentally friendly, even though they are not. In this literature-based conceptual chapter, greenwashing practices carried out by transnational corporations are analysed from a critical perspective within the scope of the corporate social responsibility (CSR) concept. The emergence of greenwashing is based on environmental conditions like climate change and the rise of environmental movements targeting companies that harm the environment. The increase in environmental movements targeting environmental problems has increased the awareness of consumers towards the environment. Consumers were willing to pay extra for environmentally friendly products. Thus, companies that were aware of that demand, found it profitable to invest in CSR. What makes the greenwashing concept suitable for a comprehensive and critical discussion is that most companies allocate much larger budgets to CSR campaigns than they do for the good of the environment. In this chapter, the relationship between the CSR and greenwashing is conceptualised as a political-economic approach, addressing the dimensions of the relations between international organisations, transnational corporations, and non-governmental organisations (NGOs) in the context of their lobbying activities for profit.

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Yılmaz, M.B., Baybars, B. (2022). A Critical Perspective on Greenwashing Under the Roof of Corporate Environmentalism. In: Mogaji, E., Adeola, O., Adisa, I., Hinson, R.E., Mukonza, C., Kirgiz, A.C. (eds) Green Marketing in Emerging Economies. Palgrave Studies of Marketing in Emerging Economies. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-82572-0_6

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DOI : https://doi.org/10.1007/978-3-030-82572-0_6

Published : 03 January 2022

Publisher Name : Palgrave Macmillan, Cham

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Online ISBN : 978-3-030-82572-0

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