Impact Brief: Greenwashing Squeeze
Climate denial is no longer a respected excuse for inaction but where there is a will there is a way. Perhaps we have normalized the idea of climate change or are in complete overwhelm or as Greta Thunberg calls it - we have been greenwashed out of our senses. What we are seeing instead is the emergence of new climate 'delaysim' that is often fueled by greenwashing of all sizes. Despite the astonishing effects of climate change across the globe companies continue to evade full action beyond lofty commitments and half-earned truths. But as we move into the latter part of 2022 an ESG reckoning is on its way as regulators start to come down on greenwashing across major geographic regions such as Australia, USA, Europe and Canada. This new reckoning is a strong signal to companies to get their acts together, and take sustainability and ESG efforts seriously, and face them with transparency. That is why this month we wanted to dive further into greenwashing at work, most talked about greenwashing stories, and strategies to mitigate greenwashing pitfalls in any business.
Happy 'green' reading.
Greenwashing and Conversations in ESG
How Sustainability Efforts Fall Apart
Sustainability efforts at scale can fall apart quickly. New work from Harvard Business Review outlines 4 hidden enemies that can stifle the process. 1. Structure and governance that is not connected to impact; 2. Metrics and processes that are rooted in traditional business thinking will neutralize sustainability initiatives; 3. Culture and leadership that reflects purpose; and 4. Bringing the right skill set to the table at the company to help fuel impact. Read more
COP27 and Coca Colas' Greenwashed partnership
Activists, Greenpeace and the media have called out Coca Colas' sponsorship of the next global climate summit. As one of the biggest plastic polluters many say it was an interesting choice by organizers, and also a convenient move by the company - a perfect greenwash move. 'If Coca-Cola wants to solve the plastic problem and climate crisis, it needs to turn of its plastic tap.' Read more here.
Competition Burea comes after RBC
Competition Bureau opens investigation to probe into RBC and 'Greenwashing' claims for its misleading advertising despite its continued support of fossil fuel projects. A first of its kind in Canada but also one that sends a message to other companies especially banks to mind is lofty claims if they are not backed by actions or activities that are in counter to its climate commitments. Read more.
Celebrity Endorsements
We are seeing greenwashing in effect from industry to industry with fashion being one of the worst actors. With ever-evolving fashion cycles, couture trends, and shiny celebrity endorsements its often hard for consumers to decipher genuine sustainability brands from greenwashing campaigns like those of Shein and H&M. But if you dig a little, what you will find are empty promises and little evidence for any commitments or action towards actual sustainability. The latest and most public victim is the Boohoo collaboration with Kloe Kardashian- who claimed to be a new partnership for sustainability but showed little to prove its efforts. Read more about the drama.
Clever Bonds Washed for Companies to feel Good
A recent Bloomberg investigative analysis found that a good portion of sustainability linked Bonds are not as clean as originally stated. Most often private contracts in nature they have varying degrees of transparency, and equally dubious standards. Many companies turn to them to fund 'green' projects, but validating the greeness of the bonds themselves is not an easy task. Companies like Chanel and Tesco buy green bonds while companies like Enbridge, A2A, SNAM, are issuing green bonds based on only portions of their scope 1 and 2 emissions and in cases like Enbridge only the carbon intensity vs the actual emission. The opaquness of the entire setup smells and looks like - you guessed it - 'greenwashing'. Read more.
ESG Needs a shared language
Depending on which perspective you approach the ESG conversation - as an investor, a business, a regulator, a climate activist, your priorities and understanding of what ESG is and should be is so varied. And yes we do need to find a common language so we can understand and communicate our work and avoid pitfalls like inaction and greenwashing. But let's ensure we don't get stuck in analysis paralysis and idleness without action, only to delay critical activities and progress. Read more.
How to Avoid Greenwashing
But if we are pointing out greenwashing how can we avoid it? We know regulation will help but how can every company look to engage with sustainability without falling into the deep greenwashing pitfall? There are many things to do but realize you or your company do not have to do it all, all at once. Start small and build, be honest, transparent, and realistic, and consider the following as you embark on your path to make an impact without greenwashing your story or commitments.
Refine your purpose, your why and your mission
Understand your ESG roadmap inclusive of UN SDGs, and considerations from other relevant standards
Build a sustainability strategy
Start on the path to impact that is measurable, reportable, and relevant
Some additional resources to get you on your way.
Green Business Bureau - A Business Guide for Sustainable Marketing
What is greenwashing and how to avoid it
News Bites and Juicy Stories
How Luxury Brands are driving a purpose agenda
How ESG got tangled in Americas' culture wars
Should nature have financial value in our accounting system?
David Wallace Wells on climate change - people should be scared
Canada Issues new framework for inclusion of Indigenous knowledge
Eco-friendly debit and credit cards are here
Microsoft adds carbon accounting to its 365 enterprise suite
Recession must go long term for ESG despite the recession
Become a greenwasher - Included in this list for a good chuckle.
Building for a sustainable future
We know building businesses in the time of climate change isn't easy but it is more than feasible. If you are on the path and need support to build a sustainability strategy, expand your impact, or strategic advice - don't hesitate to reach out. Making impact is a team effort.
