Business for Social Responsibility (a global organization with over 250 member companies whose goal is to develop sustainable business strategies and solutions) has recently co-published a report with Futerra Sustainability Communications (a UK-based communications agency that focuses on corporate responsibility and sustainability) entitled "Understanding and Preventing Greenwash: A Business Guide".
The report makes for a fascinating read, especially as pressures mount on businesses to offer green products and to be seen to be acting in an environmentally positive manner. The Report identifies several challenges to businesses: (i) global trust in businesses is at an all-time low and is diminishing (with trust in advertising at 13% and trust in company websites at only 30%); and (ii) demand for environmentally low-impact products is rising, while communicating accurately and credibly about the environmental sensitivity of a business' products is becoming more complex. The risks to a company of misrepresenting the environmental friendliness of itself or its products - thereby being seen to be greenwashing, can be severe, including less consumer sales, boycotts by NGOs and fines and enforcement actions by regulators. The Report also notes that greenwashing is also a barrier to developing a sustainable economy, by making consumers more skeptical of environmental initiatives and making it difficult for consumers to understand the impact of their purchasing decisions.