What is greenwashing and how can SMEs avoid it?

Net zero targets are growing ever nearer. And it is important that businesses invest time and money in solving larger climate issues through their sustainable ethos.
Sophie Wyatt

Sophie Wyatt

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While many are doing just this, some companies are choosing convenience over sustainability – resulting in ‘greenwashing’.

Greenwashing can sometimes be difficult to spot, both by consumers and businesses alike. It occurs when a business prioritises superficial demands rather than investing time and money in larger climate issues. Making false or misleading claims about sustainable achievements could result in serious consequences for businesses, both financially and socially.

So, what is greenwashing and how can you ensure that your business doesn’t fall into the trap?

What is greenwashing?

‘Greenwashing’ refers to misinformation provided by a business, falsely presenting itself as being environmentally friendly. With sustainability now a hot commodity amongst consumers and investors, there is increasing pressure for businesses to meet these changing expectations. This can lead to them trying to find quick fixes, which ironically can be more time consuming and expensive in the long-term than installing genuinely green infrastructure.

The term greenwashing is used to cover a range of activities that create a ‘net zero’ smokescreen – from resorting to unsustainable levels of carbon offsetting, to making false promises to consumers. Essentially, it covers any kind of corporate, climate-related misdirection. But this isn’t always the result of bad intentions. Greenwashing can occur due to a lack of knowledge or resources. But it can have hugely detrimental effects for a business nonetheless.

The six sins of greenwashing’ is a list of indicators to help consumers spot when a business is engaged in this deceptive practice. They are:

  1. No proof: Claims of reducing environmental impact are not verified by third-party certifications.
  2. Vagueness: Broad, insubstantial, or convoluted claims such as ‘all natural’, ‘made with recycled materials’ or ‘eco-friendly’, with no further information.
  3. The hidden trade-off: This occurs when businesses imply that their products are green, on the basis of a very small set of attributes. For example, some companies advertise a product as being ‘made with recyclable materials’. But they avoid mentioning that the manufacturing process releases toxic fumes into the atmosphere.
  4. Irrelevance: Although the claim may be true, it is unrelated to the company or service they are providing.
  5. Lesser of two evils: Touting one good sustainable aspect of the business while ignoring greater environmental harm.
  6. Fibbing: The sin of outright lying was seen very clearly in the case of the Volkswagen scandal of 2015. The car company admitted to cheating emissions tests by fitting defeat devices to vehicles in. This allowed the company to bypass emissions testing. Knowingly greenwashing their products, the diesel vehicles were in fact releasing 40 times the permitted levels of nitrogen oxide.

The UK government also published a ‘Green Claims Code’ last year, and the Competition and Markets Authority will carry out reviews of those companies that make misleading claims about their green credentials.

How can SMEs avoid greenwashing?

As the climate crisis worsens, it is in everyone’s interest for businesses to become truly sustainable. And alongside smaller activities – such as cycling to work and planting trees, businesses can avoid accidentally greenwashing by switching to renewables, incorporating low carbon tech and educating staff.

To promote a sustainable ethos, a business must first plan sustainability targets. These can be reached with simple yet effective changes, such as:

  • Improving your waste management
  • Educating your staff
  • Becoming energy efficient and using green energy

Becoming eco-friendly allows businesses to provide customers with complete transparency. This not only reassures them of your reliability but also allows for a wider range of potential clients.

Delivering real change is essential in moving towards a green future. While greenwashing allows businesses to pull in revenue in the short-term, it will have negative consequences further down the line.

How can we help?

The world of sustainability can be confusing at the best of times, but greenwashed products and services merely serve to further confuse the situation.

At Safe Switch Utilities, we are dedicated to providing completely transparent, sustainable services. Our green procurement strategy allows us to analyse your energy administration and match you with the right contract. So, you can be sure that you are becoming as green as possible.

Get in touch to hear how we can help you begin your sustainability journey.

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