B Lab Forces for Good Podcast — Episode 2: How can business combat greenwashing?

A look at how businesses engage in greenwashing, and how they can combat it — and the role consumers play in holding them accountable.
By B Lab Global
October 25, 2022

Have you noticed an influx of products marketed as sustainable, eco-friendly, or recycled? You're not alone. As the world becomes more environmentally concerned, businesses are increasingly leveraging green marketing to reach conscientious customers. But not all marketing is created equal. In this episode, experts from B Lab, Wieden + Kennedy Amsterdam (Advertising agency + B Corp), and PwC Chile Foundation explain the problem of "greenwashing," when marketing is designed to make consumers believe a business is doing more for the environment than they really are. We talk about how to spot greenwashing and learn from companies that are telling transparent stories about their environmental footprint.

This episode aims to answer the following questions: 

  • What is the difference between green marketing and greenwashing?

  • How have businesses and the advertising sector misled consumers about their environmental responsibility?

  • How can these same players combat greenwashing?

  • How can consumer awareness combat greenwashing? 

Guests include: 

Listen to the episode now across all major platforms: https://link.chtbl.com/Forces-for-Good-Greenwashing

TRANSCRIPT: Episode Two — How can business combat greenwashing? 

Maria Correa, Head of Marketing & Communications, B Lab Europe: The companies that are the most blatant offenders of greenwashing are the industries with the highest environmental impact or the industries that have the most need to transform. So you see this happening a lot in the energy sector. You see it happening a lot in the fashion sector. 

Sharoni Rosenberg Amszynowski, Executive Director at the PwC Chile Foundation: They need to show that they care for more than the maximization of profits and invest in that. And it's not just the words, but sometimes you have to make difficult decisions where you sacrifice some of the income for. For other metrics. 

Luk Purdy, Director of Social Impact & Group Account Director at Wieden + Kennedy: We're one of the best agencies in the world at getting people to pay attention to brands. So why not be one of the best agencies in the world at getting people to pay attention to solutions? And we really believe that companies are an essential part of modern society. [00:08:18][15.9]

This is Forces for Good, a podcast from B Lab, the nonprofit network powering the global B Corp movement. Forces for Good takes a hard look at how businesses are helping to solve the biggest social and environmental challenges of our time. I’m your host Irving Chan-Gomez

On our podcast, you’ll hear from B Corp leaders, industry experts, and changemakers. We’ll tell you about what companies are doing to move beyond buzzwords and change destructive practices across industries. We’ll ask tough questions to uncover how we can truly drive positive impact for people and the planet.

Have you noticed an influx of products marketed as sustainable, eco-friendly, or recycled? You're not alone. In this episode, we’re looking at greenwashing. It’s a marketing tactic designed to make consumers believe that a business is doing more for the environment than they really are. On the show, we’ll talk about how to critically think about greenwashing, and what we can learn from companies that are transparent about their environmental footprint.

Maria Correa, Head of Marketing and Communications, B Lab Europe: There's lots of different ways that greenwashing can manifest itself. Sometimes it's if a product is using nature cues or vague, unfounded words like eco-friendly or green or sustainable or good for the planet, for example. 

That’s Maria Correa, Head of Marketing and Communications at B lab Europe. I bet you can imagine a whole aisle at the grocery store filled with the motifs she’s talking about. Greens and blues, pictures of the planet, cute little animals, and vague terms.

Maria: Another way that greenwashing might manifest itself is if a product or if a company is talking about one specific line of products or one initiative that isn't representative of the majority of what the company does. So, for example, if there's a capsule collection that's quote-unquote “more sustainable,” yet the majority of the company's products are manufactured in an unethical way that might also be greenwashing.

I bet you can imagine this one too. A section of your favorite clothing store with slightly different tags and promises that these clothes are different. Maybe they are made out of recycled material. But the company doesn’t make those same promises about the vast majority of its product lines, or those they make the most revenue from. And they are not making concrete plans to become more responsible, either. 

Maria: Another way is if companies are focusing on future commitments that are, you know, maybe 20, 30 years down the line without providing a clear roadmap on how they plan on achieving those goals. That could also be considered greenwashing. 

Greenwashing is pervasive. The European Commission did a study where they looked at over 300 different company websites and their claims about environmental practices. They found that 42 percent of those claims were exaggerated, false, or deceptive. And they found that 37 percent used vague terms like “conscious,” “eco-friendly,” and “sustainable.”

Maria: Businesses are so keen to continue to stay top of mind and continue to win over consumers’ hearts that they talk about the planet and caring for the people without having substantially implemented practices and policies in place to positively impact people on the planet. So it's that struggle of companies rushing to meet consumers’ demand without having done all of the groundwork to actually be able to provide tangible evidence that they are indeed changing the way that they operate. 

Maria says organizations like B Lab and environmental groups want to see companies put action before communications. 

Maria: We want to incentivize these companies to rethink the way that they do business. Yet if they lead with their communications before they have tangible steps in place to to transform the way that they do business and to prove that they're truly committed to make a positive impact, that's when they get in hot water. 

Maria has suggestions for how businesses can publicize their environmental impact in a genuine way. One option is public impact reporting. That means laying out your business's whole impact — rather than picking and choosing what you want to advertise. Maria also suggests crafting messaging that’s impact-focused and specific instead of vague. 

Maria: Ultimately the role of communications is to shape perceptions. It's to inform people and ultimately can also inspire action. And so the way that you communicate and the calls to actions that are included in your communications are really important. And every person that works in communications needs to be accountable for that. 

Luke Purdy works in communications. He’s the Director of Social Impact & Group Account Director at advertising firm Wieden + Kennedy. Brands that his firm works with include Coca-Cola, Disney, and Facebook.

Luke Purdy, Director of Social Impact & Group Account Director, Wieden + Kennedy: It really does start internally in just making sure that your own company goals, objectives, and values are lining up with what you're preaching and ultimately being a good partner to your clients and making sure you're growing their business in a sustainable way. 

Luke says modern consumers are smart. And they expect more than empty promises from brands.

Luke: Is there room to move from messaging to action? And this is really important because there's a lot of brands who are doing interesting things out in the world. But to be completely honest, a commitment doesn't quite make you special today. You need to really show a plan of how you're going to get there. 

Luke also has some suggestions for how businesses can advertise their impact without greenwashing.

Luke: I think there's possibly six ways of making effective sustainability work. The first is really connecting to the brand equity and the core traits of the brand.

The second is honesty in communication — sharing your journey of positive and negative impact while making sure you’re remaining transparent. Luke’s third suggestion is specificity. Not only focusing on one part of your business like Maria warned about, but setting achievable goals for your whole company — and meeting them.

Luke: For example, we worked with Corona to clean 100 islands by 2020. And that was a goal that's obviously quite tangible. And we ended up reaching it in 2019 ahead of schedule. And so making more tangible goals like that in your communications is obviously a nice way of ensuring you're reaching your objectives and working with partners as well, I think is really important. 

Luke’s fourth suggestion is sharing goals with consumers and making them want to get involved with your initiative. It keeps the business committed to its goal and builds loyalty with customers.  Here’s the fifth one…

Luke: Finding ways into culture is also another way that is probably easier said than done. That's quite a difficult challenge. But if you can cut through the noise and create relevant conversation, your work will be more meaningful and stand out.

And finally, suggestion six is all about action.

Luke: So often we ask our clients, what do you want to achieve? What's the most important thing for your business? And once we both are on the same page with the business objectives and the shared goals, we can then build a plan out of how to reach that. And there's a lot of different pathways to get there. And so we can come with ideas and creative solutions that are more sustainably minded, that still achieve their goals. 

Having genuine purpose as a company is also a way to combat greenwashing. But as we talked about in our first episode, finding purpose isn’t easy. Sometimes companies can go wrong when they’re trying to find it. And that’s where greenwashing or “purpose” washing can occur. 

Sharoni Rosenberg Amszynowski is the author of WTF is Purpose and Executive Director at the PwC Chile Foundation. After years in the corporate world, Sharoni started working to find her purpose and working to help businesses find theirs. 

Sharoni Rosenberg Amszynowski, Executive Director at the PwC Chile Foundation: They need to show that they care for more than the maximization of profits and invest in that. And it's not just the words, but sometimes you have to make difficult decisions where you sacrifice some of the income for other metrics. 

Sharoni says one way companies can hold themselves accountable is through B Corp certification.

Sharoni: It gives you like a very good diagnosis over who you are and how you can you move forward. Then if you get the certification, it also pushes you to move forward. 

 Maria explains why certifications like B Lab’s are important to businesses and their stakeholders. 

Maria: B Corp certification really provides a framework for companies to understand and measure their own impact. And this information is independently verified through the rigorous certification process. So that in and of itself allows the company to see where they're doing well and where there's room for improvement. 

Maria says that the push toward continuous improvement is one of the most important parts of the certification process. It’s about going beyond sustainability. 

Maria: We also encourage B Corps to talk about the fact that B Corp Certification is a holistic assessment. So it doesn't just look at a company's environmental footprint, but it's important for all consumers and all investors, for example, to understand the different ways in how a business operates, not just its footprint or the packaging it uses, but also how it treats its employees and its partners and supply chains. 

Sharoni says when she goes to the store, she looks for certifications to prove that the products she’s buying come from sustainable, and purpose-driven companies.

Sharoni: So I look for the certifications.  I think that's the only way you can really, unfortunately, because you can never know the intentions of the owners or unless you know somebody that works there. Because I'm not gonna read the sustainability report of each company. 

Instead of digging through articles, brand promises, and advertising materials, consumers can easily look for those certifications. 

Maria: By no means should consumers be responsible for changing the system. I think, you know, businesses are a key player that need to be held accountable and be responsible for rethinking the way that they operate. But consumers wield a lot of power in influencing businesses, whether that's through their voice or through their wallets.

But what about big companies that need time to work toward a certification? Sharoni says they can start taking incremental steps.

Sharoni: So if you are a big company, what are companies doing? First, do you have a sustainability department, someone that coordinates through the areas and could do a mapping of what are your weaknesses and strengths? That's the first step. Do you do, like, sustainability reports? Because if you do, you have to do an exercise that  goes like the material analysis where you see what are the important issues depending on your industry and the specific characteristics of the company.. [00:18:45][32.5]

And the more information a company shares and the more informed consumers are, the harder it is for businesses to greenwash.

But it’s not just the consumer's responsibility…

Maria: It's everybody's responsibility to change the system that we live in. It's the consumer's responsibility. It's 100% the business's responsibility. But, you know, government and legislation and also media have a really important role to play in this. 

Governments can legislate sustainability standards and hold businesses accountable for unfair labour practices. The media plays an important role in educating consumers and creating public awareness of problematic practices and brands. 

Maria: It's really important for legislation to help accelerate businesses and hold them accountable for not putting out misleading claims and hold them accountable towards transitioning towards more environmentally friendly practices and and equitable practices. And it's also the role of the media to bring these stories front and center. 

Advertising agencies are also a key player in preventing greenwashing.

Maria: It’s also the responsibility of advertising agencies, for example, to be mindful of the clients that they work with, to be mindful of the type of work that they make, and also ensure that the work that they're making doesn't operate in a silo. I think it's no longer acceptable for an advertising agency to just make a communications campaign about the environment that doesn't take into account the company’s operations, for example. So, you know, if you're talking about environmental impact, you also need to understand all aspects of what goes into that production and all aspects of how that company operates as well. 

There are great examples of companies getting this whole thing right. In 2011, Patagonia, a Certified B Corporation, ran its famous ad campaign, “Don’t buy this jacket.” It advertised the brand's commitment to sustainability and asked consumers to consider their needs and the environment before purchasing new clothes.

Maria: Patagonia is one of the pioneers when it comes to really using their voice and platform to take a stand and to not just use their channels to sell products, but to champion the environment first and foremost. That's the kind of pinnacle of sustainable advertising, you know, really kind of — at the time that that ad came out, you know, really encouraging companies to reuse their product instead of buying new ones was really bold. 

And another Certified B Corp, Ace & Tate, ran a series of articles on their blog about all the mistakes they made on their journey to becoming a Certified B Corporation. Maria says this type of transparency is a great way for businesses to avoid greenwashing and prove their honesty to consumers.  

Maria: Ace and Tate, which is a B Corp here in the Netherlands who make sunglasses, when they certified, they put out an extensive article titled, “Look, we f*cked up.” And it basically showed kind of through their certification process, what did they learn about the way that they did business that, you know, maybe could be improved upon? Whether that's, you know, the materials that they use or, you know, different aspects of that. 

In one more example, Maria talked about Tony’s Chocolonely. The chocolate company was created to oppose modern slavery and child labor practices in the traditional chocolate supply chain. We’ll hear from them later in the season. But Maria says she’s really impressed by the way they incorporate real issues into engaging advertising.   

Maria: They're incredibly transparent, they’re a hugely activist brand, but they also do so in a really fun tone. And I think that really demonstrates that a lot of this information, impact reporting that we're talking about, it doesn't have to be, you know, buried inside annual reports, but it can also be be transformed into really engaging storytelling in ways to really engage with different stakeholders. 

Luke Purdy has a very specific example of a company getting it wrong.

Luke: They're investing 3 billion in carbon capture technology. However, on the side of that, they're also investing 16 billion in further oil exploration. So that's what they're not telling the public. 

He’s talking about oil company, ExxonMobil. They’ve been accused by climate activists and media of overstating their commitment to the planet.

Luke: It's really important for us to do the research when we are approached by companies and they're asking us to communicate their sustainability commitments because a lot of people can make commitments. 

And there are particularly problematic industries when it comes to greenwashing. The auto industry, fast fashion, fast food — we have a whole episode on food coming up.  Luke says advertising agencies may need to make tough decisions about what clients and campaigns to take on.

Luke: Ultimately it comes down to action. And is there a proof of action? Is there a commitment that's made? And is there, a clear path of how they're going to reach that commitment? 

He says that there are a lot of people in the advertising industry who are trying to do the right thing.

Luke: I think most people in advertising truly do want to make a positive difference, and particularly the people that come to work at Wieden +  Kennedy, that's kind of one of the the core aspects of our business is to come make the best work of your life. And really what that means is to come in and make positive impact in the world for big brands and, you know, be able to have your  friends and your parents and your family all all see it. 

The number one way Luke and Wieden + Kennedy ensure they’re not greenwashing, and the advertising they create isn’t either, is by measuring their impact as a business.

Luke: I think one thing that really stood out to me and that I've learned and brought into Weiden + Kennedy is measurement, until you've measured you don't know exactly what it is you are trying to improve and by how much. 

To undertake this measuring, Wieden + Kennedy decided to go through the B corp certification process. 

Luke: We have an experience in doing a lot of different sustainability communications for many of our partners. But we felt there's a growing need for it. And we were seeing a lot of work being done out there that, you know, wasn't quite so good. And we wanted to make sure that we were being a responsible advertising agency and we knew we needed a strong moral compass and needed to kind of first and foremost, evaluate ourselves before we could call ourselves experts in this space. 

When Wieden + Kennedy finished with the process and became a Certified B Corp,  Luke and one of his colleagues wrote an article. It was titled WTF is a “good company” anyway? And similar to Sharoni’s book WTF is Purpose, the answer is complicated. 

Luke:  At Wieden + Kennedy, while we always value trying to do things differently and going against the grain, it caused us to also look inwards at ourselves and what we value. And so we, during this time frame, changed our purpose to be a voice and influence, to help change the world in a positive way. And this really shifted our mindset from being defined by what we make in terms of advertising to being defined by our impact. 

One way they found to keep themselves and their clients honest was continuous improvement in many of the categories we’ve talked about so far. Things like transparency, measurement, and collaboration. 

Luke: In the instance of Wieden + Kennedy Amsterdam, that is mostly working with global businesses to communicate global communications for our brands. And so for us in this space, we want to make sure that we're using our position in the world to steer organizations towards creating positive change. And I don't think advertising is traditionally associated with this. But this you know, there is outsized resources that these companies have that we work with, and we want to ensure that we're using these resources and that our platform to communicate to a global audience, to share solutions and inform new consumer cultures and consumption cultures. 

They’ve worked to incorporate a mission into the advertising they produce.

Luke: We're one of the best agencies in the world at getting people to pay attention to brands. So why not be one of the best agencies in the world at getting people to pay attention to solutions? And we really believe that companies are an essential part of modern society. 

Consumers and brands need to be wary of greenwashing. And customers can show their support for honest, purposeful brands with their purchasing choices. 

Maria: Different companies are at different stages of their journey, but they can all learn from each other and learn from each other’s mistakes, but also learn about what each other are doing well. 

I want to close with a series of open questions for all of us. It’s not just about how we consume, and recognizing greenwashing. What do our consumption patterns tell us about ourselves? Why do we feel the need to own more material things? When is it enough?

A real path forward for business and society will come when we start thinking of ourselves less as consumers, workers, and entrepreneurs, and more as human beings living in a time of social and climate crisis. 

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If you'd like to learn more about B Corps and purpose driven companies visit BCorporation.net. And listen to the rest of our season! We have weekly episodes on how business can drive positive impact and be a Force for Good. Please subscribe, rate, and review the podcast on Apple Podcasts, Spotify, or wherever you listen. Your ratings and reviews help Forces for Good reach new audiences, so we thank you for your support.

For more opportunities to engage with us, follow us on social media.

The views and opinions expressed are those of the interviewees and do not reflect the positions or opinions of the producers or any affiliated organizations.

The podcast was brought to you by B lab. Our team includes Sherri Jordan, Jude Wetherell, and Hannah Munger.  Forces for Good is produced by Hueman Group Media. 

For this episode, I’d like to thank Maria Correa, Luke Purdy and Sharoni Rosenberg. 

I’m your host, Irving Chan-Gomez. Thanks for listening. And I look forward to catching you in the next episode! 

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