Greenwashing, a term coined by an American environmentalist Jay Westerveld has been a topical issue across sectors impacting consumer preferences and the environment. Mr. Westerveld used this term in 1986 referring to it in an essay stating how the hotel industry in the guise of broader environment strategy falsely promoted reuse of towels for reducing its laundry-cost projecting it to be eco-friendly (Orange and Cohen 2010). Since then, this term is being widely used as a marketing spin by the organizations by falsely projecting themselves as environmentally benign in order to reap higher profits. As per Cambridge dictionary, Greenwashing means “behaviour or activities that make people believe that a company is doing more to protect the environment than it really is” to put it succinctly it could be termed as false, misleading and deceptive techniques adopted by organizations claiming their products and services more eco-friendly than its reality thereby undermining the consumer choice which is detrimental to the environment.
Recent Trends:
As more and more customers become aware about the environment, their daily choice of products and services also drifts significantly to such products which showcase as environment friendly. This growing consumer tendency is prompting various Companies to delve into sustainable and green methods; however, some Companies are merely riding on this wave trying to capitalize this trend by green marketing. Today’s market is flooded with products and services claiming, ‘eco-friendly’, ‘carbon-neutral’, ‘cruelty-free’ ‘bio-degradable’ etc. where some firms undertake genuine measures to go green, others merely greenwash thereby impairing the customer in making informed decision.
The extent to which such practices are being undertaken by the entities is patent from the survey released by the European Commission and national consumer authorities wherein the national protection authorities believe that almost 42% of the claims were exaggerated, false and deceptive which could be termed as unfair trade practices under EU rules (European Commission Press Release dated Jan 28, 2021). Moreover, a study conducted by the Advertising Standards Council of India has also found that a whopping 79% of the alleged green claims that have been made in advertisements were misleading or exaggerated.
What Drives Greenwashing?
Amongst many reasons which drive the organizations to take recourse of greenwashing is the increased demand from the consumer for the eco-friendly products and the organizations in order to tap such demand indulge in making such deceiving claims regarding their products. Another prime reason for greenwashing is the lack of specific regulations in making environmental claims and eco-labeling, thereby giving an unchecked and unregulated arena for making false claims. Furthermore, the fact that being sustainable and making genuine green claims is expensive, the Companies find it cheaper to greenwash by exaggerating their claims than investing in environmental and sustainable measures.
Ill-Effects:
Any deceptive campaign or advertisement entails negative consequences, and Greenwashing is not averse to it. Firstly, it provides an unfair advantage to the companies engaged in such measures over the entities that are genuinely invested in their sustainable and green objectives. Secondly, greenwashing not only prejudices the choices made by the customer but rather goes against the underlying objective of making such choices, which in the long run may erode the trust and confidence of such entities. Lastly, it adversely impacts the environment by distorting the real picture of sustainability creating a skewed perception of eco-friendly choices not intended for environmental benefits.
International Checks At Play:
Of late, countries across the globe are recognizing the ill-effects of greenwashing upon the markets, consumers and environment and coming up with measures to combat this menace. Recently in 2024, the European Parliament adopted a new directive that bans greenwashing wherein generic environmental claims and other misleading product information shall be prohibited. The Competition and Markets Authority of the United Kingdom in September 2021, published its Green Claims Code and accompanying guidance to help businesses understand and comply with their responsibilities under existing consumer protection law when making environmental claims and prevent greenwashing. Furthermore, the Digital Markets, Competition and Consumers Act, 2024, effective from April 6, 2025, further strengthens the UK’s Competition and Markets Authority to directly enforce consumer protection laws, including targeting misleading green claims.
National Regulations:
The first move aiming to check greenwashing in India is taken by the Advertising Standards Council of India by introducing guidelines for advertisements making environment and green claims which are effective from 15.02.2024. This guideline comprehensively demonstrates as in how advertisers can make true, clear, evidence-based claims thereby guiding consumers to make informed choices. Furthermore, in wake of the harms posed by greenwashing and its intertwined negative impact on market, consumer and environment, Central Consumer Protection Authority issued the Guidelines for Prevention and Regulation of Greenwashing or Misleading Environmental Claims, 2024 (“Greenwashing Guidelines”) which are effective from 15.10.2024. Clause 2 (f) of the Greenwashing Guidelines define greenwashing as any deceptive or misleading practice that involves concealing, omitting, or hiding relevant information, as well as exaggerating, making vague, false, or unsubstantiated claims about the environmental benefits of a product or service. It also includes the use of misleading words, symbols, or imagery that highlight positive environmental aspects while downplaying or concealing negative attributes.
The Greenwashing Guidelines prohibit the use of generic environmental terms such as “green,” “clean,” “sustainable,” “cruelty free”, “organic” or “recyclable” etc. without adequate, accurate and accessible evidence substantiated by independent studies or third-party certifications. Greenwashing Guidelines promote transparency and require companies and advertisers to provide clear, evidence-based claims to help consumers make informed choices.
Conclusion
While most countries have yet to implement concrete regulations on this aspect, the Greenwashing Guidelines is a significant step and silver lining for inching closer to a transparent and eco-friendly market in true sense. Greenwashing remains a prevalent and concerning issue in today’s consumer landscape, where environmentally conscious consumers are pitted against pseudo eco-friendly organizations. In tackling greenwashing head-on, Greenwashing Guidelines not just dismantle the illusion of environmental responsibility, but inspire a new era of environmental integrity, where transparency and accountability become the cornerstones in our pursuit of a greener world.
