Greenwashing is essentially a form of deceit. It’s when a brand, organization or corporation advertises their products or services as being eco-friendly, eco-conscious, natural, or sustainable – when in reality, they are not.
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It’s designed to mislead investors so that they will put their money into a company or fund, believing it is good for the environment when it is not. Unfortunately, greenwashing has become more and more prevalent as the popularity of eco-friendly brands and products continues to grow.
Although they can be difficult to detect at times, we’ve compiled a list of tips for spotting the telltale signs of greenwashing so you can make an educated decision before investing in any company that claims to be “green”.
Read the Small Print
As the old saying goes, you should always read the small print – and the same applies when it comes to greenwashing! When reading product labels or the marketing for a product or service, look for specific claims such as “eco-friendly,” “organic,” or “sustainable” to see what specific criteria the company is basing this claim on.
While it’s not always possible to know the exact criteria for these labels, companies are required to disclose certain information about their product or service in order for it to be considered “organic” or “eco-friendly.” This includes what the product is made of, where it comes from, and the processes used to make it.
Consistent Legal Problems
Before investing in a company, you should do a little research into the company’s background. Look up the company online to see if there are any negative reviews or complaints filed against them.
If you find that the company has been in frequent legal trouble and has been fined by the FTC for false advertising in the past, this could be a sign that they are greenwashing.
The Company’s Management Have a Poor Track Record
A company’s management team is responsible for creating and maintaining the company’s brand and image – and will likely have some say in the marketing materials for certain products and services.
Most management teams will be listed on the company’s website, providing easy access to their names, bios, and qualifications. If the management team has a poor track record in terms of eco-friendliness, it’s likely that they are greenwashing.
Instead, look for management teams with a history of false advertising, deceptive marketing, and a lack of transparency when dealing with the public.
Woke-washing
Woke-washing is a type of greenwashing in which a company or organization attempts to appear eco-friendly by promoting an agenda such as tree planting or going carbon zero. This is often done through marketing materials such as logos, slogans, or mission statements.
Although there’s nothing wrong with promoting tree planting, businesses must be transparent about their motivations. Falsely claiming that a business is green when they are not is greenwashing.
In Summary
It’s important to remember that being eco-friendly and sustainable is not something that can be easily faked – it takes time and effort to make lasting changes to a company’s environmental impact. In order for a company to make substantial environmental changes, it will likely have to make significant changes to its operations, including its type of equipment, the fuel they use, and their source of electricity. As long as it’s something that a company is working towards, it’s worth celebrating.
