Is greenwashing always a bad thing?

We often see businesses accused of greenwashing in the media. McDonald’s was questioned about its decision to get rid of plastic straws, while having a business model reliant on animal agriculture, a huge contributor to greenhouse gases. Elsewhere, H&M has been pushing its Conscious Collection, while remaining a fast-fashion business and therefore naturally unsustainable.

But is this really greenwashing? And, if so, is it always a bad thing? Take McDonald’s. The fast-food chain uses 1.8 million straws a day in the UK. Their move to axe plastic straws in favour of paper ones chimes with the European Union’s vote to ban single-use plastics by 2021. It also serves to enhance their brand image. After all, plastic straws have become the symbolic go-to product of green consciousness.

But nobody claimed the fast-food chain would switch their burgers to plant-based protein. Greenwashing is “disinformation disseminated by an organisation so as to present an environmentally responsible public image”, according to the Oxford Dictionary. There’s a difference between deceptive disinformation and taking a small step in the direction of sustainability.

The problem, it later transpired, was that their paper straws are not recyclable as they’re too thick for the recycling infrastructure currently in place. But the company says it is looking for a solution to the problem.

Small steps towards sustainability

Can a fast-fashion company have a sustainable collection? “In the fashion industry, we’re very good at calling out what companies aren’t doing, as opposed to what they are doing,” says Erica Charles, lecturer at the British School of Fashion of GCU London. Big fashion companies are juggernauts, she notes, that are not as agile as fashion small and medium-sized enterprises (SMEs). They therefore require more time to make changes.

“My personal opinion is these little steps are positive because it forces other organisations to do something as opposed to nothing at all,” she says. A small percentage change at a large company still has a significant “impact and ripple effect on the rest of the industry to review their approach to business”.

When cases of greenwashing come to light and are debated, Charles says, “it’s actually a positive thing in the sense that some of the startups and SMEs emerging in the fashion industry have to make sure they do responsible business”.

But while it is vital for people to call out brands on their practices and demand they do better, it’s also crucial that call-out culture doesn’t deter companies from trying at all.

Let’s not forget that almost nothing is fully sustainable. Electric cars and solar batteries require the mining of rare metals. Paper straws are greener than plastic, but they’re still shipped across the world on the back of fossil fuels. Most “green” choices have unintended consequences in the supply chain. That’s not to say green attempts are worthless, just that there are different degrees of sustainability.

Where greenwashing and ESG intersect

What about greenwashing in the world of investment? Environmental, social and governance (ESG) factors have rapidly gained currency as a buzzword. But it’s not always what it seems. The absence of negative filters, which filter out weapons or tobacco investments, for example, means supposedly “responsible” funds can sometimes contain investments most people would not consider socially responsible. Such cases need to be called out and addressed.

“I see a lot of greenwashing among investment fund managers, who say they’ve always focused on ESG, when they’ve only ever focused on the G,” says Ben Yearsley, director at Shore Financial Planning. In other words, focusing on governance issues, such as a company’s ownership structure or gender equality, doesn’t necessarily mean they’re helping the environment.

These little steps are positive because it forces other organisations to do something as opposed to nothing at all

“ESG is a fad now, but it will be the norm in five years’ time,” he says. But are all industries “ESG-able”? Yearsley says tobacco isn’t, as “it has no useful purpose; it does no good”. However, when it comes to oil and gas companies, he says: “We are relying on fossil fuels for the next few years, and we need Shell and BP to be the next energy companies.” He cites Ørsted as an example, which used to be a Danish oil company, and is now a large provider of wind energy.

How to communicate small wins for sustainability

While deceitful greenwashing is unethical, small sustainable steps are laudable. So, what is the most acceptable way for businesses to communicate and celebrate mini-wins for sustainability, without being seen to be greenwashing or glossing over areas that still need improvement?

What it comes down to is transparency and honesty. “We’re in a transition of change and change takes time,” says Charles. “But if an organisation is categorically just trying to deceive consumers and jump on a bandwagon, then they deserve to be called out.”

If, on the other hand, a company is making a small improvement, transparency is key. It’s a good idea to present small changes for what they are, without purporting to be the sole fulfiller of the United Nations’ Sustainable Development Goals. Another solution is to publicise sustainable products once they actually make up a substantial part of a company’s function and revenue.

People increasingly demand that companies make positive changes. The majority (73 per cent) of consumers worldwide say they would change their consumption habits to reduce their impact on the environment, according to research by Nielsen. So companies have a huge opportunity to reap the benefits of sustainable business practices.

Ultimately, people influence what companies produce, and vice versa, and positive reinforcement is productive. So rather than shaming people for flying, it makes more sense to demand eco-friendly fuel becomes the norm in aviation. After all, it’s about creating an environment that encourages innovation.