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What is greenwashing?

image: green paint greenwashed wall greenwashing example of greenwashing

Greenwashing is when a company uses adverts and PR campaigns to make a product, brand or the company as a whole, appear greener than it really is. 

In this article we examine the problems with greenwashing, name some of the companies involved, and explain how to spot it.

Why do companies greenwash?

Companies use greenwashing to boost – or recover – their reputation. They also use it to appeal to environmentally-aware consumers. 

With awareness about climate breakdown and loss of biodiversity growing, more and more people are concerned about the damage from major corporations.

Many people are also looking for more ethical alternatives. Companies use greenwashing to try and capture this market and gain competitive advantages over their rivals. 

By maintaining a positive image, corporations also try to show that the ‘problem is in hand’. This way, they can avoid or delay actions by governments, for example effective laws against pollution or emissions. 

Which companies are involved in greenwashing?

Unfortunately greenwashing is widespread.

40% of green claims made on the websites of clothes, cosmetics and food companies could be misleading consumers, according to an assessment of 500 websites by the International Consumer Protection Enforcement Network, a global group of consumer protection authorities. For fashion, the number could even be as high as 60% and up to 90% for some brands.

A growing number of companies are being called out for their greenwashing practices. Here, we give five examples. 

Shell

In June 2023, the UK’s advertising regulator banned a Shell advert promoting its green initiatives. The advert was found to be “likely to mislead” – because it failed to tell consumers that the vast majority of Shell's business is based on fossil fuels. 

The company ran a TV, poster and YouTube campaign that promoted its involvement in renewable electricity, wind and electric car charging points. 

Shell is one of the biggest fossil fuel giants in the world and reported 1,375 million tonnes of CO2 emissions in 2021 – four times the total emissions of the UK. While the company has set a target to reach net zero by 2050, it also plans to expand its gas business by a fifth over the coming years. 

HSBC

In October 2022, the advertising watchdog also banned two HSBC ads for being misleading about its action on climate change. 

HSBC used posters to promote its tree planting efforts and support for customers to achieve ‘net zero’, in the run-up to the UN's major climate summit, COP26. The Advertising Standards Authority said that the HSBC adverts “omitted material information” about the bank’s activities. 

The bank has provided $144,934.41 million USD in funding to fossil fuel companies since 2016 and is the thirteenth biggest funder of all banks globally.

Boohoo

Boohoo has repeatedly been criticised for greenwashing its image in an attempt to distract from the massive environmental damage of its fast fashion model. 

In 2022, the company came under fire after it appointed Kim Kardashian as its new ‘sustainability ambassador’. The celeb launched a ‘capsule collection’ of 45 items. Critics pointed out that it could “only serve to distract” given that the company sells a whopping 40,000 styles on its site every year. 

Boohoo’s brand Pretty Little Thing also widely promoted its secondhand marketplace last year. But protestors said that the company was “putting the onus on consumers to be more environmentally friendly” while failing to address the massive environmental impacts of its disposable fashion model. 

Also in the fashion world, we look at Temu and its potential use of AI greenwashing.

Coca-Cola

Coca-Cola was amongst a number of brands called out in 2022 for using greenwashing tactics to distract from plastic harms. 

The soft drinks giant had spent millions promoting the fact that its bottles were made with 25% marine plastic, without mentioning that it was the world’s largest plastic polluter, the report by Changing Markets Foundation found. It's also been ranked as the world's largest plastic polluter four years in a row, by Surfers Against Sewage in their Dirty Dozen report, responsible for almost 1/5 of all branded pollution collected.

Etihad Airways

In April 2023, the Advertising Standards watchdog banned a further two ads from Etihad Airways, saying that the airline had “exaggerated” the environmental benefits of flying with them.

The two Facebook adverts claimed Etihad was “taking a louder, bolder approach to sustainable aviation”. But the Advertising Standards Authority pointed out, “no initiatives or commercially viable technologies in operation within the aviation industry [...] would adequately substantiate an absolute green claim such as ‘sustainable aviation’”. 

The aviation industry alone accounts for over 2 percent of all global CO2 emissions.

Where did the term greenwashing come from?

The term ‘greenwashing’ was coined by Jay Westerveld, an American environmentalist and researcher, in 1986. The word was initially used to describe the adoption of a reusable towel service at a beach resort in Samoa that was sold as a way to help the environment. Meanwhile, the resort was expanding further and further into the local area, where there were vital coral reefs. 

How to tell if a company is greenwashing?

If you are concerned a company’s environmental initiative might not be all it seems, there are a few important questions to ask.

What proportion of a company’s products are sustainable?

Companies will often develop one sustainable product or brand and promote it widely – while making the vast majority of profits from harmful practices. 

While the vegan brand Vivera might look sustainable, for example, it is owned by meat giant JBS. JBS is the world’s largest meat company and has been linked with massive deforestation of the Amazon. 

How do they define sustainable?

It is also important to consider what a company considers to be sustainable or environmentally friendly, as it may differ from your own view. 

For example, lots of fast fashion brands label clothes containing some recycled fabric as ‘sustainable’. However, if a fleece or jacket uses 20% recycled polyester, and 80% new, would you consider it to be sustainable?

How do they compare to companies in the same field?

Banks like HSBC may promote their green actions, but remain laggards within their sector. A growing number of specialist banks like Triodos not only refuse to invest in fossil fuels, they only support greener companies – for example renewable energy projects. 

Ethical Consumer’s shopping guides compare brands in a sector so you can really understand who the leaders and laggards are.

Governments crackdown on greenwashing

Governments are waking up to the risks of greenwash. 

Companies in the UK could face fines over up to tens of millions of pounds if they make misleading environmental claims, according to a new bill published at the end of April 2023. The proposed law, which is still under discussion, could see fines of up to 10% of global turnover for breaches of consumer law. 

The bill is the latest in a crackdown in the UK. In 2022 the UK Competition and Markets Authority (CMA) released a new Green Claims Code - a piece of guidance aimed at helping businesses to ensure that any green claims they’re making are truthful and don’t mislead well-meaning shoppers.

In 2024 the CMA has also reported that ASOS, Boohoo, and George at Asda have signed formal agreements stating that any green claims they make will be clear and accurate. The agreements follow an investigation by the CMA which is scrutinising companies' claims for potential greenwashing and follows concerns around the way the companies’ products are being marketed to customers as eco-friendly.

Change is also being made in the EU – including a ban on ‘climate-neutral’ claims. The new law, agreed in September 2023, sets stronger rules against vague, partial or false claims about environmental impacts. Companies will have to have strong evidence of eco promotions, as part of a raft of possible new measures. 

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