Industry Market Trends

Beware of Greenwashing: Avoid Eco-Hype

Apr 27, 2010

As increasingly more businesses provide "green" products and services, others are inflating or misrepresenting the environmental performance of their products or services. Smart businesses and marketers should consider the following tips for making environmental claims responsibly.

As demand for environmentally preferable purchasing increases, "greenwashing" — the practice of misleading purchasers about the environmental benefits of a product or service — remains a key concern.

"All it takes is a few big scandals about something not being very green — after it was promoted as green — and consumers will stop trusting," Anastasia O'Rourke, co-founder of the research firm Big Room, Inc., recently told Momentum, a magazine published by the University of Minnesota's Institute on the Environment.

For manufacturers and other businesses selling products, it is important to make environmental claims legally. Last summer, the Federal Trade Commission (FTC) issued complaints against Kmart, Tender Corp. and Dyna-E international for making false and unsubstantiated claims of "biodegradability." The FTC then went after a number of companies that claimed their products were green because they were made of bamboo when, in fact, they were made of rayon. (After settling with the manufacturers, the FTC followed up with warning letters to 78 retailers.)

Meanwhile, S.C. Johnson & Son faces a class action suit alleging that placing a proprietary "Greenlist" seal on its Windex window cleaning products misled consumers into believing that the products were independently certified by a third party; the Greenlist was actually an S.C. Johnson-conceived program. (Source: Advertising Age)

"Unfortunately, not all manufacturers have made the investments necessary to provide more environmentally preferable products," Scot Case, founding board member of the International Green Purchasing Network, has written at GovPro.com. "In order to compete in a market that demands 'green' products, some manufacturers have resorted to creative advertising instead."

Since 1992, the FTC's Guides for the Use of Environmental Marketing Claims ("Green Guides") have helped advertisers avoid making "unfair or deceptive" claims in violation of the Federal Trade Commission Act by describing the basic elements needed to substantiate specific environmental claims. An updated version is expected later this year.

In the meantime, smart businesses should follow these tips from Futerra Sustainability Communications' The Greenwash Guide:

  1. Know thyself. Determine whether you are "green" at all. Be careful choosing the products or services you wish to promote as green, and make sure that offering isn't countered by an overall negative reputation the company might have.
  2. Be green by design, not luck. The best product or service to promote responsibly is the one specifically designed (or redesigned) to be green, not the one where you have searched for a green aspect. "Green by design" products are likely to have undergone a full life-cycle analysis of their environmental impact.
  3. Check and check again. Seek both internal and external experts and get their opinion on the design of current products. Internal experts may include "Sustainability" or "Corporate Social Responsibility" teams. Ensure these checks are made before embarking on green promotions.
  4. Choose your friends wisely. When inviting third parties to endorse your product (in the form of labels and respected organizations' logos), be careful to choose those with reputational integrity. Don't just go with the easy option; big labels are hard to reach and that's exactly why they are trusted.
  5. Remember words can hurt you. Some terms, like "organic," now have legal definitions or, like "Fairtrade," are copyrighted. So, make sure you can justify using such terms; if in doubt, see Advertising Law and Green Marketing Regulations at Business.gov. Images — such as a flower, a leaf, Earth, etc. — can also give a misleading impression.
  6. Greenwash health-check. Although your green campaign might be rigorous in its claims, it is important to remember that greenwash can pop up across your various communications, whether in ads, press releases, product packaging or executive speeches. Health-check all channels for possible greenwashing.

Last month, Mintel International reported that more than one-third of Americans say they would pay more for environmentally friendly products. Hopefully, businesses will work hard to ensure these consumers get what they set out to pay for.

Futerra Sustainability Communications' full Greenwash Guide below

Greenwash Guide

Earlier: A Darker Shade of Green

Resources

Certified Confusion

by Melanie Warner

Momentum (University of Minnesota Institute on the Environment), Winter 2010

FTC Announces Actions Against Kmart, Tender and Dyna-E Alleging Deceptive 'Biodegradable' Claims

Federal Trade Commission, June 9, 2009

FTC Charges Companies with 'Bamboo-zling' Consumers with False Product Claims

Federal Trade Commission, Aug. 11, 2009

FTC Warns 78 Retailers, Including Wal-Mart, Target, and Kmart, to Stop Labeling and Advertising Rayon Textile Products as "Bamboo"

Federal Trade Commission, Feb. 3, 2010

Class Action Accuses Classic Cleaner of Greenwashing

Green Patent Blog, April 1, 2009

Going Green the Smart (and Legal) Way

by Randi W. Singer

Advertising Age, March 10, 2010

Beware of Greenwashing: Not All Environmental Claims are Meaningful

by Scot Case

GovPro.com, July 1, 2007

Guides for the Use of Environmental Marketing Claims

Federal Trade Commission

The Greenwash Guide

Futerra Sustainability Communication, April 2008

The Six Sins of Greenwashing

TerraChoice Environmental Marketing Inc., November 2007

Advertising Law

Business.gov

Green Marketing Regulations

Business.gov

Are Americans Willing to Pay More Green to Get More Green?

Mintel International, March 25, 2010

Efforts Spread to Verify Claims of Businesses Who Market Themselves as Environmentally Friendly

by Leslie Berkman

The Press-Enterprise, Jan. 31, 2010