What is greenwashing and how can your small business avoid it?

Say your company sells a product. Every week, you drive a truck full of inventory to the store. Your truck uses one tank of gas per trip. But then you buy a new, more fuel efficient truck. You begin to advertise your product as “50% more green!” because you’re using half the gas. But the truth is, while your transportation may have marginally improved, your product is no better for the environment than it was before.

What is greenwashing?

Greenwashing is a marketing strategy used by companies to make people believe they’re doing more to protect the environment than they really are. It’s generally done on purpose, and the impact of such a ploy can be detrimental—to the environment and to a company’s reputation.

Real-life examples of greenwashing

Greenwashing is one of those concepts that’s easier to understand with examples. Here are a couple that are hard to forget.

Volkswagen Group

Remember the Great Volkswagen Emissions Scandal of 2015? Volkswagen Group, which has often touted a mission to be eco-friendly, tricked consumers and emissions tests by installing a “defeat device” in its vehicles. The device or software, used in diesel engines, altered the results of U.S. emissions tests to make it look like their cars were performing better than they were. In reality, the vehicles were spewing up to 40 times the allowed limit of nitrogen oxide pollutants.

In 2016 the Federal Trade Commission sued Volkswagen, claiming the company had deceived its customers by describing its vehicles as ‘Clean Diesel’ cars. Even after evidence of faulty emissions tests came to light in 2014, Volkswagen continued to run ads that appealed to buyers’ eco-conscious mindsets. Potential buyers were told the cars were environmentally friendly, met emissions standards, and would maintain a high resale value. None of that was true.

As a result, the company suffered enormous losses—both financial and in customer opinion. Years later, Volkswagen is still rebuilding its reputation.

Fiji Water

In 2011, Fiji Water made headlines after it became part of a class-action lawsuit centered around false advertising claims and greenwashing. The company was accused of “forward crediting” or taking credit for carbon reductions that hadn’t yet occured. Fiji Water’s website claimed it had been a carbon-negative brand since 2008. But in reality, the results of its steps to become truly “carbon-negative” wouldn’t be fully realized until 2037.

Customers often associate Fiji water with sustainability because its advertising speaks to a deep respect for the environment. Commercials accompanied by images of lush, green forests often tout the water as a brand that leaves nature “completely alone.”

But Fiji Water cannot, by virtue of its industry, leave nature completely alone. A plastic water bottle, even one made from recyclable materials, still takes 450 years to break down in the environment. And that doesn’t account for a company’s energy usage, shipping resources, and all the other ways bottled water affects the planet.

How to avoid greenwashing your business

The simplest answer for avoiding greenwashing is to just…not do it. Your reputation is on the line, so it’s not worth it. Don’t tout an “eco-friendly mindset” unless your company is actually taking strides to operate more sustainably.

Of course, sustainability can feel like a big, overwhelming topic to tackle and if you are actually making some changes, it’s understandable that you’d want to let the world know. Simply understanding your carbon footprint will help you avoid making any false claims in your marketing. Try conducting an energy audi  or using a certified carbon footprint calculator to get a better understanding of the ways you are—or aren’t—making an impact.

Once you have a grasp on what could be changed, there are a lot of ways you can start to go green. Your business could donate to nonprofits focused on conservation, packaged or shipped with less waste, or the supply chain could be locally sourced.

Appoint someone who feels passionate about the planet to be your company’s sustainability ambassador. Empower them to research ways your company can be more environmentally mindful. Let them work alongside your marketing department to ensure your messaging is accurate, should you decide to put a “green” spin on things.

Most of all, a good rule of thumb is this: Invest more time and money into caring for the environment than talking about how much you care for the environment. Be genuine. If you do that, your reputation has nothing to lose, and our planet may have everything to gain.