Committing to improving sustainability and a pathway towards achieving net zero is now a clear requirement for any business or organisation. However, as key audiences become more well-versed in what good sustainability looks like and how it should be approached, accusations of greenwashing have steadily increased. For some businesses, the suggestion that a key sustainability effort that they have built their ESG messaging around isn’t as environmentally friendly as they are portraying can badly undermine their brand perception. Good sustainability is a key and growing part of how key audiences perceive your business, but going about it in the wrong way risks more harm than good.
What is Greenwashing?
Greenwashing is an effort to show audiences that a business is doing more to protect the environment than they really are. Typically, greenwashing falls into two broad categories. The first is unintentional greenwashing, which can be surprisingly common given the pressure for businesses to demonstrate sustainability credentials and the amount of often conflicting advice available regarding how to achieve progress towards net zero. Many sustainability efforts come from a place of good intentions, but a lack of understanding how a business actually achieves that sustainability can risk accidentally straying into activities that could be classed as greenwashing.
One area that many businesses fell afoul of, and key audiences such as investors are now acutely aware of, is 100% renewable energy. Switching your supply over to a 100% renewable energy tariff seems like a simple solution, and allows for the persuasive marketing message that your business uses only clean electricity. In practice, many of these tariffs don’t actually guarantee that the electricity you use is 100% renewable, and instead make clever use of Renewable Energy Guarantees of Origin certificates to brand their electricity supply as renewable. As an extreme example, one British electricity provider switched their generation portfolio from just 3.7% renewable to 100% overnight.
The second category is deliberate greenwashing. How common this can be is up for debate, but there have been clear, concerted efforts by several large businesses to mislead consumers and deflect criticism of unsustainable business practices, such as the ongoing use of or prospecting for fossil fuels. Perhaps the most high-profile example is the Volkswagen emissions scandal in 2015, where an electronic device was used to trick emissions tests. After the story broke, VW profits fell 20% and they made their first annual loss in more than 20 years.
Avoiding Greenwashing
Before your marketing team run with sustainability messaging, ensure that what they plan on saying is accurate and demonstrable. It can take substantial effort, or the support of net zero and sustainability specialists, to properly identify areas where sustainability can be improved, but the effort will pay off with sustainability messaging that you can be confident in.
Ensure that what commitments you make as an organisation are practical and achievable. An outright commitment to net zero can seem appealing, but accurately measuring and abating all of your associated emissions can be extremely challenging, particularly for an SME. Scope 3 emissions, those originating in your supply chain, can be particularly problematic to calculate with any sort of accuracy, and as a result many carbon reduction certification schemes only require them to be partially accounted for.
Be accurate and transparent in your efforts and claims. If a solar installation means that your site now runs on 75% renewable electricity, say so, rather than attempting to obfuscate the issue. Customers and investors are more interested in concrete, demonstrable progress than vague platitudes.
How Powerstar can help?
Powerstar’s technologies deliver clear, demonstrable improvements to energy consumption and subsequent carbon emissions. Battery energy storage systems are also invaluable in terms of maximising the impact, including the sustainability improvements, of other technologies such as on-site generation or EV charging. Remote monitoring and control software also gives you far greater oversight of how your business uses energy, and which areas could be improved.
