Unmasking Greenwashing: The Consequences and the Cure

In our increasingly environmentally conscious world, it’s common for companies to tout their green initiatives and environmentally friendly practices, and that’s just good business. But all too often, companies claim benefits – like the environmental superiority of “recyclable plastic” packaging or “going green” by switching from paper to electronic communications — as a way to cloak poor environmental performance or mask cost-cutting efforts. With no sound scientific evidence to back them up, these types of claims are textbook greenwashing.

Some of the consequences of greenwashing are obvious. Clearly, unsubstantiated environmental claims mislead consumers, often causing them to take actions they would not otherwise consider. As reported previously by Two Sides North America (TSNA), psychological research has shown that when people see and hear unsubstantiated claims over and over again, they start to believe them as true, and ultimately incorporate them into their decision making. A 2022 TSNA study confirmed this finding. The study showed that among Americans who had repeatedly seen “go green, go paperless” and similar claims from their banks, utility companies and other services providers, 65% were influenced to switch from paper to electronic bills and statements.

Greenwashing claims can also cause reputational harm, not only damaging the credibility of companies that make such claims, but also casting doubt over the valid claims of companies that are contributing to real environmental progress. The U.S. Federal Trade Commission’s “Green Guides” provide very specific guidance related to environmental claims, stating that “claims must be truthful, not misleading and supported by competent and reliable scientific evidence.” Unfortunately, this guidance is often ignored.
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