Avoiding Greenwashing: Essential Tips for Tech Companies
For most business leaders and consumers, the premise of greenwashing–when a company misrepresents or falsely inflates their environmental work–is nothing new. With 70% of adults believing that corporations should do more to combat climate change, there is mounting pressure to make bold sustainability commitments. But these statements must be backed by credible strategy: accusations of greenwashing can be damaging to reputation, presenting a new area of measurable and material financial risk for companies.
Greenwashing is regulated and scrutinized by governing bodies around the world. The Federal Trade Commission (FTC), for example, publishes its Green Guides to help marketers avoid making environmental claims that mislead consumers. While not regulatory in nature, the FTC regularly uses the Green Guides as the basis for bringing legal action against companies for employing greenwashing practices.
What is a greenwashing review?
Companies from any industry, including the technology sector, can be guilty of greenwashing. To avoid getting caught up in greenwashing, it’s necessary for companies to conduct a review. The goal of a greenwashing review is to hold your company accountable for its environmental claims and help consumers make informed choices by ensuring statements are accurate, transparent, and backed by credible evidence.
This process involves a company scrutinizing its advertisements, promotional materials, product labels, and public statements/reports to assess whether they make unsubstantiated claims, use misleading imagery, engage in vague language, highlight minor accomplishments, employ irrelevant information, or fail to disclose negative practices. When undergoing a greenwashing review, it’s important to (1) identify any and all claims which argue for an environmental (and social or otherwise) benefit or reduced impact from a product, service, or overall, client performance, and (2) assess evidence for each claim, confirming they’re based on scientific evidence and technical knowledge.
What are potential repercussions of greenwashing for tech companies?
Greenwashing accusations can present reputational and financial risk for tech companies. In 2022, a sales promotion launched by a large e-commerce company was called into question for labeling disposable, plastic-packaged products as “sustainable” during an Earth Day campaign. Additionally, that year, multiple global retailers reached a $5.5 million total settlement with the FTC in response to “deceptive eco-friendly claims” about their products. These claims were advertised online via company webpages.
Additional resources and next steps
Looking to learn more about avoiding greenwashing? Greenbiz recently released an overview of greenwashing terms to avoid at any cost. Among them: general marketing claims such as “green,” “eco-friendly,” “natural” and “sustainable,” which are often used in broad and misleading ways. Additionally, the eight reporting principles from the Global Reporting Initiative (GRI) are incredibly helpful to keep top-of-mind when developing credible sustainability reports and communications.
Are you a tech company looking to make sure your sustainability claims and commitments are backed by evidence and free of greenwashing? Reach out: the Uplift team is here to help.
The Uplift Agency
Uplift builds strategies, programs, and communication campaigns that advance ESG in workplaces, supply chains and communities.
We know how to navigate the road ahead because we’ve already been down it – 90 percent of our team has led environmental or social programs in corporations or nonprofits. Because ESG is all we do, our services are more comprehensive and integrated than most firms.
