Sustainability communication - 8th commandment: Thou shalt not practice greenwashing

"Whether it's cosmetics, food or electronics, consumers currently have the impression that almost all products are promised to be climate-neutral, plastic-free or recyclable," says Dr. Andreas Neus, Managing Director and Vice President of the Nuremberg Institute for Market Decisions e. V. He can back up this feeling with figures: According to his institute's recent international study "Greenwashing vs. Greenacting", 52 percent of the companies surveyed currently use green claims, i.e. advertising statements related to the environment and sustainability, in their customer communications. He provides the reason for this right away: "In doing so, they are meeting a great demand - sustainable shopping is important to 76% of the consumers surveyed." The temptation to use greenwashing to deceive consumers and increase sales has never been greater. This is a danger for the organic and natural cosmetics industry - just as it is for the transformation to a sustainable economy and society.

 

From greenwashing to bluewashing up to pinkwashing

In today's consumer society, awareness of environmentally friendly and socially responsible practices is constantly growing. This is particularly reflected in the preferences of many consumers, who increasingly prefer sustainable, organic and ethical products. However, the willingness to pay more for "green" products is also attracting companies with less honest intentions. One practice that is becoming increasingly important in this context is "whitewashing". The various analogies to this term refer to strategies with which companies pretend to act in a socially or ecologically responsible manner, for example, without being able to demonstrate substantial measures or changes in their business practices. In addition to the best-known form, greenwashing, there are also the equally reprehensible practices of bluewashing and pinkwashing.

Recognizing and avoiding greenwashing

Greenwashing is usually a marketing strategy in which companies present their products or services as more environmentally friendly than they actually are, for example to benefit from the ever-growing sustainability movement. Or to put it more scientifically: "Greenwashing is an umbrella term for various misleading communications and practices that intentionally or unintentionally create false positive perceptions of an organization's environmental performance. According to the result of the evaluation of the current state of knowledge about greenwashing by an interdisciplinary research group, it can be carried out by companies, governments, politicians, research institutions, international organizations, banks and also NGOs and ranges from slight exaggeration to complete fabrication, so that there are different forms of greenwashing."¹

Greenwashing often occurs by using misleading labels, false environmental promises, green images and colors in packaging and advertising, or by overemphasizing minimal green initiatives. Greenpeace has taken the trouble to compile a list of typical greenwashing measures²:

• Launching alibi campaigns: Focusing communication on a "green" characteristic while ignoring other, more important environmental issues. An example: A restaurant chain promotes the switch to recyclable paper straws while continuing to use a conventional meat supplier from overseas.
• Not being specific: Intentionally using very broad or inadequate terminology to cause misunderstanding or make verifiability difficult. For example: A cosmetics company uses a recycling symbol on its packaging without stating that it only applies to a small part of the packaging.
• Not providing evidence: Making claims without providing evidence for its claim. An example: A food company uses the term "climate neutral" on its product packaging, but does not make it clear on the packaging or in other product information how this "climate neutrality" is achieved.
• Using green keywords or images: Advertising or packaging with lots of natural scenes or images such as trees and leaves. Or buzzwords that mean nothing without explanation, such as "non-toxic", "all natural", "environmentally conscious" and "chemical-free". An example: a cosmetics brand advertises a sun cream with "ocean-friendly" and a picture of a healthy coral reef.
• Simply offsetting CO2 emissions: Instead of going to great lengths to reduce the CO2 emissions they cause themselves, only use CO2 compensation programs. An example: A bakery continues to use conventional electricity to run its bakery instead of switching to green electricity and prefers to offset the CO2 emissions caused by financing a reforestation project.
• Making redundant claims: Making claims or using green terms when it is not necessary. For example, a drinks manufacturer uses the phrase "bottle without plasticizers" on its plastic bottles, even though this is prohibited by law anyway.

Elsewhere, the use of questionable labels and seals, the deliberately exaggerated use of technical terms or the deliberate exertion of contrary political influence are described as greenwashing approaches. However, while the before mentioned strategies usually operate in a legal gray area and are often only morally reprehensible, this no longer applies to the approach of deliberate lies, which also exists. In this case, it is a matter of unfair competition and legally punishable acts

Bluewashing, pinkwashing and other forms of consumer deception

Bluewashing refers to the practice of companies presenting themselves as socially responsible, often through association with recognized international organizations and standards, but without taking substantive action to address social and ethical challenges. In contrast to greenwashing, which focuses on environmental claims, bluewashing focuses more on social and ethical issues. 
Pinkwashing, on the other hand, is a practice where companies or brands show solidarity with LGBTQ+ communities or other marginalized groups to create a progressive image, but without showing substantial support or inclusive practices in their business operations. This can also be done to capitalize on the associated positive attention without actually advocating for the rights or well-being of these communities. A typical example is redesigned corporate logos in rainbow colors during the annual Pride Month - but only in regions that are open or at least neutral towards the LGBTQ+ community, but not, for example, in Arab countries or Russia.

Other forms include purplewashing, which involves communicating supposed gender equality, or healthwashing, i.e. the communication of deliberately misleading health promises.

 

Greenwashing as a risk factor

Just like greenwashing, all of the methods mentioned above can also be used - consciously or unconsciously - by representatives of the organic and natural cosmetics industry. It therefore makes sense to address the issue in order to raise awareness within the industry. How easy is it for the communications department to paint the logo in rainbow colors for a few days or weeks, but your company has neither support for an LGBTQ+ network nor tampon dispensers in the men's toilets? And how great is the temptation to advertise a product as "climate neutral" thanks to CO2 compensation for better sales figures, instead of investing in measures that would really lead to a reduction in CO2 emissions in your own or upstream production?

Avoidable mistakes or deliberate deceptive maneuvers can cost the company concerned a lot of money. "If the green veneer crumbles, sustainable products turn out to be not so sustainable after all, and companies obviously fail to meet their responsibilities, there is a risk of a massive loss of reputation among shareholders and consumers. Many entrepreneurs underestimate the associated negative impact on company value," says Gunter Lescher, Partner Forensic Services at PwC Germany. The Nuremberg Institute for Market Decisions also has an impressive figure for this: 72% of consumers surveyed avoid companies or brands that are accused of making false or misleading sustainability promises.³

In the worst case, a lawsuit and a trip to court await - as in the case of the drugstore chain dm. In spring 2022, for example, it was targeted by Environmental Action Germany (German: Deutsche Umwelthilfe; abbreviation DUH) together with several other companies, which took legal action against misleading advertising promises claiming that products were "climate neutral" in the interests of consumer protection. Jürgen Resch, Federal Managing Director of DUH, justified the action as follows: "The advertising promise of climate neutrality is often consumer deception. It is often more of a CO2 emissions trade that companies use to wash themselves green. This takes money out of people's pockets but does nothing to protect the climate." This summer, the Karlsruhe Regional Court ruled in favor of DUH, stating that this would raise expectations that the products in question did not meet. For the lawyer representing DUH, Prof. Dr. Remo Klinger, this is no surprise: "One example shows how absurd the compensation model is: instead of laboriously and expensively actually reducing Germany's emissions, the Federal Minister of Finance would only have to pay 19 billion euros a year to make Germany climate-neutral on paper from now on according to this indulgence trade. That's less than half the annual profit of BMW, Daimler and VW in 2021. And in real terms, Germany would fuel the climate crisis unchecked."

Regardless of how you personally feel about DUH and the complaints, something needs to be done about greenwashing in particular. "Greenwashing destroys trust and is therefore a threat to the successful transformation of our society," Antje von Dewitz, Managing Director of outdoor company Vaude, warned on the LinkedIn business portal just recently. This is because every case of greenwashing not only reduces the credibility of genuine corporate sustainability efforts, but we as a society also lose valuable time that would be needed for real and effective sustainability changes.

Glimmer of hope: the "EU Green Claims" initiative

In March 2023, the European Commission presented a proposal for a directive on Green Claims⁴, i.e. advertising messages related to sustainability. This proposal complements and fleshes out a previous draft directive to empower consumers in the sustainable transformation of our economy and society. The initiative aims to provide consumers with reliable, comparable and verifiable environmental information about products. One of the core measures of the initiative is to create clear criteria for how companies must prove their environmental claims and labels. Furthermore, these claims and labels will have to be verified by an independent and accredited expert. In addition, there will be new rules for the management of ecolabels and labels to ensure that they are robust, transparent and reliable. Incidentally, the EU Ecolabel and the EU organic logo for organic food are already covered by established legislation and are therefore exempt from this directive.

Nevertheless, the EU Green Claims Directive represents a significant development as, on the one hand, it will define the requirements for advertising green products and services more clearly than before in the interests of companies. On the other hand, it forces companies to carefully examine and transparently substantiate their green advertising promises and messages in the interests of consumers. However, the new directive still has to be approved by the European Parliament and the Council of the European Union before it can come into force. This is likely to be the case in spring 2024. If the decision will be taken then, the member states of the European Union will have 24 months to transpose the directive into national law.
In any case, it can be expected that greenwashing and the EU Green Claims Initiative will also be major topics at the international trade fairs BIOFACH and VIVANESS, which will take place in Nuremberg from February the 13th to February the 16th, 2024.