Environmental sustainability has formed the core of a new public discourse, putting pressure on corporations to perform environmentally and respond to claims that they are actively contributing to climate change.
As a result, numerous companies now take an active role in environmental engagement. Increasingly, a firm’s commitment to the natural environment is becoming part of a corporations existence and is notably taking a prominent role in CSR programs. Environmental issues for many corporations have come to be perceived as attractive in terms of the economic stimulus it can activate, while achieving CSR goals.
As information on environmental performance is becoming widely available due to institutional watchdogs and an environmentally aware public that demands more transparency, firms are increasingly subject to stakeholder scrutiny. “There has been a shift to values-driven advertising. Consumers are anxious to make their environment a better place to live, therefore companies that intend to be leaders, should share the same values and strive to make a difference,” says Antonio Vincenti, president of the advertising syndicate in Lebanon and CEO of Pikasso which is currently implementing the Integrated Management System for Health, Safety and Environment to raise more awareness on green issues and safety .
Talking About Commitment
In order to appease stakeholders and gain legitimacy, companies have been found to opt for quick fix symbolic responses with minimal substantive action. A lack of standards and definitions for determining green products and practices has further induced this greening trend being applied to even the most environmentally unsound products. As the demand for eco-friendly products grows worldwide, a new market has made companies eager to tap into the environmental consciousness of consumers. Ad campaigns have emerged everywhere, marketing the greenness of products and services, thus mirroring a change in consumer conscience.
The sudden flooding of advertisement space with green products has resulted in skepticism towards the credibility of claims and a general questioning of responsibilities towards communicating green. According to Vincenti, “Advertising has a main role in educating and engaging people in adopting a “green behavior”, if a product is environmental friendly it needs to be supported by advertising campaigns. Advertising has a great power on influencing people’s behaviour, and it has a bigger responsibility in conveying the right message to the consumers.”
Communicating environmental commitment and practices or even CSR in the right way is key. Research has found that when stakeholders reveal that a company’s green claims are exaggerations or lies, the effects can be extremely damaging and threaten a company’s reputation by negatively influencing stakeholder trust.
“Green behavior is part of CSR practices but if CSR measurements and acts are not sustained, companies will find themselves in a greenwashing position,” Vincenti remarks. The false use of environmental benefits or CSR for reputational gain is referred to as greenwashing.
The Dangers of Greenwash
Greenwash has many dangers. By engaging in greenwash, companies are not just putting their own trust and reputation at risk but are inherently damaging the environment and the industry around the premise of green. As a result, efforts of companies who are actually engaging in real CSR plans, are put in question and green slogans become subject to disbelief. In a knock-off effect further damage is done to the advancement of green technology and compliance with green license or certifications as they become less credible.
The problem is made worse by the variations of green labels and claims. Some green claims are clear and substantive while others, especially those using terms like natural and eco-friendly, only create a good impression without explaining the environmental benefit in enough detail, resulting in a further loss of credibility.
Marketing and advertising departments are finding communicating genuine “greenness” can be challenging. There is indeed a fine line between communicating a green campaign and committing greenwash. “Although advertisers have the task of educating people on all relevant eco-friendly practices, the challenge lays in pushing people to change and adopt such practices,” says Vincenti. Especially as the value of CSR increases reputational development, marketing and advertisement departments must be careful when choosing how to promote CSR, as false claims can become a point of vulnerability. Vincenti recommends what to consider when communicating greenness: “Companies need to understand that when communicating about their greenness, they are engaging themselves in a process that can affect their long term corporate image. They need to consider that with the internet and social media, a brand can be negatively affected if it engages in greenwashing.”
A recently published survey by Nielsen found that a majority of environmentally conscious consumers consult social media for socially responsible businesses. False claims which are made public or are not communicated properly can have grave effects on the company. Vincenti further noted. “ In social media, a brand is like a member. The brand identity is rated by accumulation of experience within the community, one bad experience will spoil your brand integrity and destroy your brand image.”
Stakeholders want accurate information from advertising messages and current feedback channels such as social media provides additional influence to how companies will go about advertising their greenness in the future. At present there are no standardized requirements for CSR reporting and few greenwashing policies. Companies are free to present their CSR information as they wish and not much is stopping them from engaging in greenwash. However, even though standards do not impose guidelines yet, growing stakeholder awareness and scrutiny should guide corporations to avoid comitting the greenwash sin. “Long term sustainable practices can have a great impact for the brand on the long run vs. disastorous repercussions with hit and run greenwashing campaigns,” Vincenti concludes.
A Regional Perspective
Greenwashing campaigns have become abundant in the region in recent years as the green trend grows in popularity. While companies face ever stricter environmental regulations and scrutiny in their own countries which they have had to scale up, lax environmental laws in the region have not demanded the same commitment. These multinational companies promote their environmental decree from their headquarters, with very selective support for environmental initiatives in the regions where they operate.
Another problem presents itself in the few existing guiding policies from governments with regards to greenwash or making false claims. Various companies can be seen trying to convince the public that more and certain kinds of consumption can be good for the environment when they are blatantly harmful. In the Arab World, there is currently little monitoring by the government and no policies in place to regulate greenwashing. Although complaints can be made to environmental ministries, the follow-up is often weak, if not absent. Countries are beginning to set up their efforts. In Lebanon, a new environmental audit law which is currently being discussed in Parliament may substantially reduce the amount of greenwashing.
There seem to be several factors affecting the state of greenwashing in the region. According to Greenpeace campaigner Rayan Makarem “The biggest problem with regards to greenwashing is the lack of environmental education.” Environmental education currently does not result in the attitudinal and behavioral changes needed to significantly reduce ecological degradation. Academics argue that an informed citizenry is crucial because awareness of an environmental issue is a pre-condition of taking environmental action. NGO’s and green parties throughout the region are taking up the responsibility of educating communities, however more needs to be done especially from a policy side. As a first step, making social and environmental reporting mandatory and public could reduce the amount of greenwashing in the market. However, the public have an equally important role in holding companies accountable when they fail to keep their promises.
Source: Responsible Business Magazine