The term ‘Greenwashing’ has found itself nestled within everyday conversations when it comes to businesses and climate action – but what is it exactly? Greenwashing is a portmanteau of whitewashing, the act of deliberately ignoring or glossing over an issue, and green action, or projects aimed at reducing environmental damage. As such, greenwashing refers to the glossing over issues of environmentally unfriendly business actions by dissimulating them or misleading the public [1-3]. The term has become commonplace in the past decade as businesses seek to attract consumers who are increasingly becoming more interested in sustainable goods and services.
To do so, businesses highlight how environmentally-friendly their product is, how the processing or sourcing of materials is in line with fair trade and sustainability, and sometimes even just suggesting they are green using language and color schemes (above). However, companies engaging in greenwashing are never truly taking action to make their businesses green, but are misleading consumers in order to profit [1-4].
Greenwashing is relatively commonplace. Major companies and small businesses have been identified as greenwashers – a label that is hard to shed and affects their reputation [1, 4, 5].
One example is the car manufacturer Volkswagen. The company was caught faking their emissions reports on several lines of their diesel vehicles in 2015. Branded as the most environmentally-friendly diesel vehicles on the market, Volkswagen capitalized on consumer demand for affordable low-emission transport [5]. However, the US Environmental Protection Agency (EPA) realized that the German manufacturer had rigged the testing, and the cars actually produced up to 40 times more emissions than actually advertised. Volkswagen denied directly misleading the public, saying they misunderstood the testing requirements, but the damage was done. Labeled a greenwasher, the company’s stock plunged as it was faced by class action lawsuits from around the world and several billions in fines [5].
While Volkswagen was caught in the act falsifying data and misrepresenting its product, there are several other types of greenwashing. Fossil fuel companies are known to participate in greenwashing involving misdirection by presenting themselves as key businesses in the renewable energy field. They highlight their investments in emerging technologies and carbon-reduction measures – yet they continue to prospect for new fossil fuel extraction sites and do not roll back on current production [6]. Likewise, specific fossil fuel lobbies have attempted to greenwash their energy sources. Coal has tried to rebrand itself as “clean coal” without explaining what made it ‘clean’, while natural gas companies have presented themselves as a low-emission fossil fuel that has even been branded ‘green’ by major economies, this despite natural gas still producing far more emissions than renewables.
Branding, marketing and advertising are actively used to create the illusion of science-based, sustainable climate action [1-3]. Retail giant Walmart recently announced plans to shift to a low-carbon operating model, following a similar move by other major companies. Yet Walmart’s framework does not include Scope 3 emissions which includes its high-polluting supply chains, while other businesses have taken theirs into consideration [3]. The aviation sector has actively come under fire for similar reasons, offering passengers to add a carbon offset donation that supposedly would counter the emissions of their flight – something a recent investigation by The Guardian disputes [7].
The examples above are just some of the types of greenwashing that can be encountered on a daily basis. While it may seem as though it is more pervasive than first thought, there has been a movement to counteract greenwashing which involves taking actual action to reduce emissions and embrace a sustainable business model [8]. Consumers are demanding more sustainable products, but they are also becoming more adept at recognizing greenwashing. As such, the best way to appeal to them and provide sustainable goods or services is by doing just that and shifting your operations to become more environmentally-friendly. It can’t be greenwashing if you are actually taking concerted actions to reduce your emissions and supporting sustainability. Have you thought about whether or not you may be greenwashing, and have you thought about the opportunities you may have to make your business sustainable?
[1] Bruce Watson, 2016, “The troubling evolution of corporate greenwashing” The Guardian
[2] Knut Haanaes, Frédéric Dalsace & James Henderson, 2021, “How to identify greenwashing”, Institute for Management Development
[3] De Freitas Netto, S. V., Sobral, M. F. F., Ribeiro, A. R. B., & Soares, G. R. da L. (2020). Concepts and forms of greenwashing: a systematic review. Environmental Sciences Europe, 32(1).
[4] Eloise Barry, 2021, “As More Companies Make Net-Zero Pledges, Some Aren’t as Good as They Sound”, Time Magazine.
[5] Geoffrey Smith & Roger Parloff, 2016, “Hoaxwagen: How the massive diesel fraud incinerated VW’s reputation—and will hobble the company for years.” Fortune
[6] Li M, Trencher G, Asuka J (2022) The clean energy claims of BP, Chevron, ExxonMobil and Shell: A mismatch between discourse, actions and investments. PLoS ONE 17(2)
[7] Patrick Greenfield, 2021, “Carbon offsets used by major airlines based on flawed system, warn experts”, The Guardian
[8] Vincent Diringer, 2022, “The Importance of Sustainable Business Models”, LEAD-WiSE.
Excerpt of Forbes – Michael Georgiou, Forbes Councils Member
Co-Founder at Imaginovation, overseeing the company’s global creative and strategic marketing, branding and advertising initiatives.
In today’s digital world where the internet is overflowing with information, choices and intense competition, what really makes a brand stand out?
Is it an excellent and unique product or service? Is it a brand’s visibility? I’d say it’s the brand’s authenticity. Having a quality product is, no doubt, essential for a brand, but it’s not enough.
The modern customer is smart, tech-savvy and research-oriented. Today, consumers can observe you, even when the spotlight is off. In my experience, what they really crave is a genuine, credible, trustworthy and authentic experience in this hyper-connected virtual world.
But how can you build an authentic brand experience? And why is it so important to winning more customers?
An authentic brand is one that decides to be transparent and consistent in its messaging and branding initiatives. It has business values it remains true to, and most essentially, it is honest.
Do you know what can happen when customers do not trust a brand — when they do not find a brand authentic? They often start looking for other brands they can trust.
Your brand’s authenticity has never been more relevant. According to recent Stackla data (via SocialMediaToday), 90% of customers mentioned authenticity as an important factor in deciding which brands they like and support.
There are many reasons why I believe brand authenticity is crucial for winning customers.
Read more:
In leadup to the 2021 United Nations climate change conference, COP26, countries announced their plans to decarbonize their economies in order to help mitigate the impacts of climate change – net-zero. These net-zero goals involve reaching a balance where the greenhouse gasses produced by an action are cancelled out by the amount of gasses it removes from the atmosphere. These pledges involve large investments into infrastructure and a general shift in economic priorities for many governments, but several major companies have also pledged to decarbonize their operations. Some, like PwC, have set ambitious targets that would see them reach the mark by the end of this decade [1, 2]. Scepticism from the public is rife however, as consumers are wary of greenwashing claims and inaction from both governments and companies – but net zero is the future of sustainable businesses, and opportunities exist for them to thrive using such a business model.
In an analysis of Fortune 500 companies with net-zero plans, the World Wildlife Foundation (WWF) found that only 20% had science-based plans. “A lot of businesses and investors are setting these kinds of targets, and they’re doing it, arguably, for PR reasons,” explains Oxford University professor Thomas Hale [3]. Companies like Walmart highlight the issues of greenwashing. Walmart, who have pledged to reach net-zero operations, do so without incorporating the emissions produced by their supply chains – which are the largest source of emissions for the company [3, 4].
PwC on the other hand has committed to the United Nations’ science-based targets for companies, joining other financial companies like AIA in transitioning their operations, investment portfolios, and that of their partners to align with net-zero goals. But what does this look like [5]? For PwC it means reducing their amount of corporate flights, transitioning their fleet of work vehicles to electric models, refitting their buildings to become more energy efficient, reducing waste and investment into emerging technologies [1]. Investing giant AIA went a step further and divested from coal and indicated that it would not carry out new investments related to fossil fuel, choosing to finance renewable power and sustainable development projects, and ensuring that its partners did the same [2].
Net-zero and sustainable business models are not just good for the planet, but they are also a financial opportunity [6, 7]. Several CDP reports highlight that the cost of not adapting to climate change-driven market demands will lead to trillions in stranded assets, and while implementing a sustainable business model may not be cheap, the long-term benefits far outweigh short-term, non-sustainable approaches [5, 7]. Consumers want their products and services to be sustainable, they are ready to spend more for them – and they are becoming more adept at identifying greenwashing. Have you thought about implementing a net-zero or sustainable business model?
[1] PriceWaterhouseCooper, 2022, “Towards net zero”, PriceWaterhouseCooper.
[2] Yvonne Lau, 2021, “7 years ahead of schedule, AIA becomes the first major Asian insurer to end coal exposure”, Fortune.
[3] Eloise Barry, 2021, “As More Companies Make Net-Zero Pledges, Some Aren’t as Good as They Sound”, Time Magazine.
[4] Net Zero Tracker, 2022, “Companies”, Net Zero Tracker.
[5] CDP, 2022, “Data”, CDP.
[6] Vincent Diringer, 2022, “The Importance of Sustainable Business Models”, LEAD-WiSE.
[7] Zameer, H., Wang, Y., & Saeed, M. R. (2021). Net‐zero emission targets and the role of managerial environmental awareness, customer pressure, and regulatory control toward environmental performance. Business Strategy and the Environment.
Excerpt from Fast Company – By Dan Osusky
As the world’s governments continue to balk at taking the necessary aggressive action, more and more companies are announcing what appear to be bold climate commitments, stepping up to take action where countries are not.
But while more than 3,000 businesses have made commitments within initiatives of the UNFCCC’s Race to Zero campaign, that’s a drop in the bucket. Only 42.8% of Russell 1000 companies have disclosed a commitment to reducing emissions, with only about 26% having more rigorous commitments including Net Zero by 2050 or an approved science based target. You might conclude that we need more climate commitments.
(…)
How to bridge the gap between these perspectives? More action is necessary, and commitments are one way to do that, but rather than focus on the commitments themselves, let’s focus on accountability to the commitments.
Accountability can ensure that the commitments being made are meaningful: ambitious and aligned with the science on timelines, including in their scope the things that matter (like all emissions from a product’s supply chain and use, and the greenhouse gases beyond carbon), and the methods to achieve them (i.e. direct reductions, removals, offsets, and so on). It also ensures that the commitments are actually upheld—not only by the “end date” of the commitment, but in regular increments that demonstrate that the end goal is actually feasible and on track.
Where commitments are valuable are as a means to enable accountability. Once a commitment is made, that commitment can be scrutinized and evaluated. It’s not all negative: the right commitments can be applauded and praised for positive reinforcement. When necessary, they can be criticized and condemned. But once a commitment is made, transparency needs to follow. Lack of transparency can itself be criticized, and when we have transparency, it’s possible to ensure that companies are living up to their commitments on a regular basis and following through with the proportionate level of action and achievement of results towards their end goal.
Read the full article: https://www.fastcompany.com/90696664/corporate-climate-commitments-dont-mean-anything-without-accountability
The scale of the climate crisis can seem overwhelming as entire nations seek to decarbonise their economies, enact sustainable development goals, while environmental degradation is being recorded globally. For everyday consumers, the sheer size of the issue can make it too daunting to tackle as an individual – yet they can absolutely have an impact. Sustainability starts at home, and businesses have an important role in helping their communities adapt [1].
From providing services that encourage sustainable habits – such as the 7 Rs (Rethink, Refuse, Reduce, Repurpose, Reuse, Repair, Recycle) – or finding opportunities to unite stakeholders to promote a message, businesses of any size can be a part of the movement [2]. Globally, consumers are already interested in becoming more sustainable, but have indicated a lack of opportunity or knowledge as the reason they have yet to change their behaviour [3]. Here exists a chance for sustainable-minded businesses to become a part of the global transition to a low-carbon future. Purpose-filled companies following a progressive agenda that adapts to market trends will ensure that they are ahead of their competition and become a part of the transition [4, 5].
Consumers are more aware than ever of the impact their choices and that of the companies they support have on the environment [3, 5]. As global governments shift towards a low-carbon economic framework there has also been a shift to take into account consumer needs and wants when it comes to sustainability [6]. As Bart de Smet points out for the World Economic Forum, consumer power can scale change, and businesses have the opportunity to bring on that change by providing and promoting sustainable alternatives while leveraging consumers’ insights and knowledge for action [4].
The future is low-carbon and will be built on the foundations set by companies that were willing to encourage sustainability in everyday life and provide opportunities for their communities. Climate change is happening. The transition towards a circular society is underway – so why delay adapting to a sustainable business model [7]?
[1] Kate Bassett, 2021, “Sustainability begins at home: how to live a lower-carbon lifestyle”, Financial Times.
[2] James Ellsmoor, 2019, “Environmental Education Will Shape A New Generation Of Decision-Makers”, Forbes.
[3] Southern Cross University, 2019, “Going Green”, Southern Cross University.
[4] Bart de Smet, 2022, “Closing the ‘say-do gap’: How businesses can help consumers build sustainable habits”, World Economic Forum.
[5] Deloitte, 2021 “The Deloitte Global 2021 Millennial and Gen Z Survey”, Deloitte Touche Tohmatsu Limited.
[6] J.N. Sheth, N.K Sethia, & S. Srinivas, 2011, “Mindful consumption: a customer-centric approach to sustainability”, Journal of the Academy of Marketing Science 39, pp. 21-39
[7] Vincent Diringer, 2022, “The Importance of Sustainable Business Models”, LEAD-WiSE.
Biomimicry offers the promise of creative, sustainable solutions to solve our greatest design challenges. But it’s not enough to have a strategy for tackling a problem without the means to make it a reality.
Biomimicry thinking helps create products and processes that:
An excerpt from Forbes by Ashley Stahl – a Forbes Contributor
As a millennial who has had the opportunity to work with Gen-Zers, Gen-Xers and Baby Boomers, I used to wonder if we made too much about the difference in attitudes between the generations.
It seems like these days so many articles want to focus on these differences between generations. I feel like every time I go to my feed, it’s always “Baby Boomers this” or “Millennials that.”
…But are we really all that different than our older or younger counterparts?
Well, in some important ways, we’re not so different. We all want the same things when you come down to it: happiness, fulfillment, appreciation, security. These are all universal goals that most of us share.
But when it comes to certain values, attitudes and expectations, there may be some significant differences in how members of different generations approach their lives, especially in the space of work.
A few years ago, I started to work with my first clients from Gen-Z who were entering the workforce. And I must say that to my surprise, many of my Gen-Z clients expressed very different attitudes about their careers then their Millennial, or even Gen-X counterparts.
The more I’ve worked with Gen-Z clients and observed the impact that their ideas and expectations are having on the world of work, the more I realized that this generation was shaking up business culture and work as we know it.
So what are the changes that Gen-Z is expecting, or initiating, in the world of work? Here are a few major ways in which Gen-Z workers are changing the game.
Before we dive in, let’s establish the boundaries around which most people define these generations.
Baby Boomers usually refers to the post-World War II generation, born between 1946 and 1964. Generation-X represents people born between 1965 and 1979 or 1980. Generation-Y, most often referred to as Millennials, span the birth years of 1981–1997. Anyone born between 1997 and 2012 is considered a member of Gen-Z, although certain data sets extend this to 2015.
Generation Alpha is most often said to include anyone born between 2010 and 2025. These generational parameters overlap and generally vary depending on the source.
Obviously, Generation Alpha is a long way from the workforce, but stay tuned in 15 years for my hot take on Gen-A’s workforce preferences!
If you’re like me and you are routinely shocked to find out that a person who you once held as an infant recently graduated from college, it may be difficult to imagine Gen-Z having a major impact on the workforce. But think again. Data shows that by 2025, Gen-Z workers will make up 27% of the workforce.
One major way in which Gen-Z workers are distinguishing their preferences from those of other generations is with a very values-driven approach to their careers and job prospects.
Spend five minutes on Twitter these days, and you’ll likely find someone accusing a member of Gen-Z of being “too woke.” But say what you will about the way many “Zoomers” chose to express their politics online, they are willing to back it up in their choices when it comes to the job market.
A telling article in the New York Times describes the “Techlash” on college campuses, detailing the difficulty that many with the tech sector had in attracting Gen-Z talent in the recruitment process.
Just a few years ago, an offer from a tech company was considered something of a “Golden ticket” for Millennial job seekers, promising high salaries and over-the-top office culture and benefits. In contrast, many members of Gen-Z seem to be put off by negative perceptions of the tech industry and the growing concern about the ethics of certain practices within the tech world.
While these sentiments are being expressed openly by certain members of Gen-Z in the workforce, they seem to reflect a broader shift in the way people view the technology sector. A Pew Research study found that the percentage of Americans who felt that the Tech industry had a positive impact on society dropped substantially from 71% in 2015 to 50% in 2019.
For some members of Gen-Z, the desire to evaluate companies based on a set of moral standards seems to extend beyond preferences in the workplace and impact the consumer choices of Gen-Z as well. A survey found that 51% of Gen-Z consumers would ensure that a brand was aligned with their own values before making a purchase.
Generating leads is the most important part of any business. The ability to market an organization’s services to the right target demographics in a successful way is a skill that takes a lot of time to master. Lead generation makes or breaks a company – making it especially integral at the onset of an entity’s operations. Lead generation is among the top marketing priority for marketers. [1].
Leads qualify based on the interest of potential costumers [2]. For example, a marketing-qualified lead of a contact expresses interest but the client is not yet ready to discuss sales. A sales-qualified lead inquires about the business’ product or service ready to buy. While a product or service-qualified lead defines a returning costumer to engage again in the business’ service or product. Finding and developing these leads require a good marketing and communication strategy that successfully leverages a business’ activities [3].
This means identifying what makes the business different from its competitors and emphasizing how their products and services are the superior option. However, markets have become more competitive and consumers more aware of their choices than ever. As such, purpose-led organizations that seek to improve their communities and promote change are favoured by a majority of consumers [4, 5]. For example, a company with a sustainable business model creating environmental and social benefits on top of its products and services sets itself apart from competition [6].
Building leads require investing time in a marketing strategy that highlights the business’ strengths and direction the organization wants to go. This includes to identify the client journey, the target audience and their key concerns while creating content relevant tailored to their public. This means actively building an online presence through relevant content by publishing articles on blogs, engaging in social media while creating content for leads – [1-3]. The organisation becomes a thought leader in its domain.
When carrying out engagement activities, having a Call to Action (CTA) is especially important. A CTA is a prompt for leads to get into contact or purchase a good or service and helps building the company’s customer base. Cultivating leads and providing good service pre, peri and post sales ensures word-of-mouth promotion and create a positive brand image that emphasises a business and generates more leads [1-3]. How are you generating leads and grow your business?
[1] HubSpot State of Marketing 2021
[2] Lindsay Kolowich Cox, 2021 “Lead Generation: A Beginner’s Guide to Generating Business Leads the Inbound Way”, Hubspot.
[3] Robyn Kyberd, 2020, “The Ultimate Guide to Lead Generation for Sustainable Business Growth”, Medium.
[4] Deloitte, 2021 “The Deloitte Global 2021 Millennial and Gen Z Survey”, Deloitte Touche Tohmatsu Limited.
[5] Southern Cross University, 2019, “Going Green”, Southern Cross University.
[6] Vincent Diringer, 2022, “The Importance of Sustainable Business Models”, LEAD-WiSE.
Excerpt from McKinsey – By Marco Albani and Kimberly Henderson
Companies are increasingly expected to join with other organizations—both public and private—to address social and environmental problems. Here are seven ways to make such alliances successful.
Business is being asked to do more than ever to solve social and environmental problems. As a result, a growing number of leading companies are taking the challenge of sustainability seriously, not only to reduce their environmental footprint and bolster their reputations but also to improve operations and financial performance.
Many ecosystem challenges cross jurisdictional boundaries and require systemic changes beyond the capabilities of individual companies or even of an industry. In these cases, the best approach for business can be to partner up—with governments, investors, local communities, nongovernmental organizations (NGOs), and other companies. Think of these partnerships as distinctive and complicated joint ventures, often with multiple parties.
Such collaborations often go through phases—good, bad, and sometimes ugly, particularly in the early days. The Marine Stewardship Council (MSC), a partnership that sets standards for the fishing industry, struggled in its first few years with high staff turnover and unstable funding. In the past decade, however, it has become a force. Its certification standards cover 10 percent of the global seafood harvest, and almost a quarter of global shoppers recognize the MSC label. This covers more than 20,000 products sold in over 100 countries.
To understand how to make these collaborations work, we interviewed dozens of business, government, and NGO leaders. From this research, we identified seven essential principles of success.
Read the full article: https://www.mckinsey.com/business-functions/sustainability/our-insights/creating-partnerships-for-sustainability
Sustainability is no longer a buzzword. As the world works towards finding appropriate solutions to the climate crisis, consumers are becoming increasingly aware of the impact that their personal choices have. More people than ever before are seeking to become sustainable, and they are ready to pay more for products that can be certified as being environmentally friendly [1].
Greenwashing, or making a product seem more sustainable than it is, has been the status quo for businesses appealing to customers’ demand. However, as a study by Deloitte highlights, younger generations have caught on, and they value companies who promote a progressive agenda [2].
The cost of not adapting to climate change-driven market demands will lead to trillions in stranded assets [3]. Investments and projects are considered stranded if they have unexpectedly become liabilities due to an unplanned obsolescence or reduced demand. This is not limited to fossil fuel companies, but every other sector – climate change’s effects are global and will affect businesses regardless of their industry or position on the supply chain. As several reports from the CDP Worldwide point out, the cost of implementing a sustainable business model will pay off in the long-term, not just by reducing an entity’s carbon emissions and mitigating climate impacts, but also by streamlining services, reducing overheads, increasing returns and meeting customer demands [4, 5]. Adopting a sustainable business model is future-proofing [6].
“Adapt or die,” noted the United Kingdom’s Environmental Agency ahead of the United Nations climate change conference in November 2021 (COP26) [7]. Consumers value truly sustainable products and global governments are serious about decarbonizing their economies. Major actors within the private sector have recognized the risks of not adopting a sustainable business model and are transforming their industries. Yet, many institutions have not analyzed their own, or their portfolio’s impact on the climate [5]. With major sustainability goals set to be reached within this decade, there is a pressing need for businesses to evolve with the times or risk being left behind – what will you choose?
[1] Southern Cross University, 2019, “Going Green”, Southern Cross University.
[2] Deloitte, 2021 “The Deloitte Global 2021 Millennial and Gen Z Survey”, Deloitte Touche Tohmatsu Limited.
[3] Ben Caldecott, Elizabeth Harnett, Theodor Cojoianu, Irem Kok, and Alexander Pfeiffer, 2016, “Stranded Assets: A Climate Risk Challenge”, Inter-American Development Bank.
[4] CDP, 2019, “Global Climate Change Analysis 2018”, CDP.
[5] CDP, 2021, “Financial Services Disclosure Report 2020”, CDP.
[6] C.P. Gurnani, 2020, “Sustainability and profitability can co-exist. Here’s How”, World Economic Forum.
[7] Environment Agency, 2021, “Press release: Adapt or die, says Environment Agency”, United Kingdom Government.