How to avoid greenwashing
We’re hearing a lot of chat about greenwashing lately, including that the European Supervisory Authorities (these are Europe’s financial watchdogs) are now monitoring and seeking examples of greenwashing, and that three quarters of investors think companies are greenwashing their sustainability records.
While it’s definitely important to keep abreast of these global developments, here in New Zealand with our tendency for tall poppy syndrome, news like this tends to reinforce companies to keep a lid on their activities, rather than proactively share their learnings and experiences and help shift the industry forward. There is a fear of being cut down for what is not being done, or worse still, that there’s a risk being tarnished with the ‘G-word’ – greenwashing – for any of the green or sustainability activities that do get promoted.
So how can companies talk about their sustainability without greenwashing? Here are our tips:
Authenticity – Tell it like it is. Sustainability is not a sales campaign - you are not putting your best foot forward and showcasing only all the great features. It’s about being transparent about the full journey, warts and all. It’s important to recognise that you’ll never get to a point where sustainability is ‘done’; the bar for excellence is continuously rising. By recognising this and articulating the things you know your business needs to work on, you are front-footing stakeholder concerns and showing foresight into the future of your business. This is a far more credible approach than a narrative which only focuses on the ‘wins’ and avoids addressing the issues - consumers now have a much higher degree of scrutiny on green claims and thanks to social media, it’s easier than ever to call out BS.
Ambition – match green ambition to organisational ambition. If you are a market leader, then you should be aiming to be a market leader in sustainability too. Setting a middle-of-the road sustainability strategy that focuses on inward, incremental operational improvement risks greenwashing, because there is an expectation you are capable of more, that you are a market leader and should be looking to take things to the next level, create value for society and environment - a minimum effort approach can appear shallow or fake. Conversely, if you are a fast follower, there’s no point in setting out to be a leader if the business ambition is not there to back it and move forward that progressively. There is definitely a risk of greenwashing if you set ambitious targets but do not have the support or resourcing to deliver on them.
Ability – ensure you have the sustainability competency inside the organisation, to deliver on your ambition. A lack of people with the appropriate sustainability skills to action the organisational sustainability goals may lead to greenwash, as the organisation may fall short of addressing its sustainability issues meaningfully, or with the required level of technical depth. Organisations should consider the type of sustainability professional(s) they require to meet their specific sustainability objectives – whether that is a sustainability generalist – someone who leads and facilitates the sustainability strategy; a technical or specialist – someone who brings very specific technical or specialist sustainability skills into the organisation or role; or people within different departments adding sustainability capability into their current role; or a combination of all these.
Alignment – align your sustainability strategy and activities to global standards and frameworks, such as B Corporate, ISO 14064, Greenhouse Gas Protocol, Global Reporting Initiative, Integrated Reporting, and Taskforce for Climate-related Financial Disclosures. This not only helps to provide rigour and guide your sustainability approach and narrative, but also provides a basis for comparison in future years - both in reflecting on your own performance, but also in benchmarking yourself against others.
Action – take meaningful, measurable action that has clear targets and performance metrics to fulfil the strategic sustainability goals. The more you can quantify the impact you are creating through your sustainability activities, the less risk there is of greenwash. Its difficult to argue with numbers that evaluate performance, whereas descriptive statements on performance may come across as vacuous if they can’t be substantiated with data.
Assurance – seek third party audit and assurance of your non-financial reporting. This provides an objective opinion that the things you say you are doing are accurate and are benchmarked against a particular global standard or framework.
If you’re looking for further support with any of these aspects, get in touch – we provide expert sustainability consulting services for organsations of all sizes and maturity on their sustainability journey.
