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<\/figure>Two common forms of greenwashing consist of claim and executional. Claim greenwashing is using textual elements in advertising throughout the use of vagueness or buzzword terminology to make claims of environmental responsibility that may be misleading (Parguel et al., 2015, p.108). A great example of claim greenwashing is the Innisfree green tea moisturizer that has been called out for having a paper wrap stating \u201cHello. I\u2019m Paper Bottle.\u201d misleading customers to think it is a paper bottle despite having a plastic bottle inside.<\/p>\n<\/div><\/div>\n\n\n\n
Executional greenwashing is the use of environmental-based images such as waterfalls and mountains or renewable imagery such as windmills and solar panels to portray a perception of greenness that may not properly represent the corporation or product (Parguel et al., 2015, p.108). <\/p>\n\n\n\n
The Ford advertisement for their G-series vehicles displays rolling green hills with windmills in the back creating the sense of an eco-friendly vehicle while its fuel efficiency (23.76 mpg) (Carsguide, 2022) is worse than the average (25mpg) (John, 2019). Common characteristics of greenwashing most commonly accepted are the making of false claims, omitting information allowing for critical analysis of a green claim, and the use of vague and ambiguous terminology that could be misleading or misinterpreted (Burbano, 2011; Parguel et al., 2015.). While these definitions of greenwashing display intentional greenwashing, how can a corporation or manager in charge of a corporate social responsibility report avoid unintentionally doing the same? <\/p>\n<\/div>\n\n\n\n
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<\/figure>\n<\/div>\n<\/div>\n\n\n\nTo avoid unintentional greenwashing it is important to see beyond the suds on the surface and focus on what is in the wash basin. Corporations within Canada have large potential for unintentional greenwashing in their corporate social responsibility reports due to the large variation in power generation from province to province. For example, British Columbia produces 87% of its electricity from hydroelectric sources, 5% from biomass, 4% from wind, and the remainder from natural gas, refined petroleum, and solar (Canada Energy Regulator, British Columbia, (2022)). Whereas, Alberta produces 89% of its electricity from fossil fuels, 6% wind, 3% hydro, and 2% biomass (Canada Energy Regulator, Alberta, (2022)). This means that BC electricity emits 18.6 grams of CO2e per kWh generated while Alberta emits 620 grams of CO2e per kWh of electricity generated as of 2019. This is a difference in emissions of 34 times per kWh of electricity generated. This must be taken into account when making sustainability claims for similar initiatives in different provinces such as fleet electrification and site generation of electricity. If this is not taken into consideration unintentional greenwashing can occur due to misleading claims or inaccurate calculations from the differing carbon intensity per kWh. Photovoltaic arrays will have a 34 times greater reduction in carbon emissions in Alberta due to higher fossil fuel content used when generating electricity than in British Columbia. Whereas, fleet electrification will have a 34 times greater reduction in carbon emissions within British Columbia than in Alberta due to the higher renewable energy content when generating electricity. When reporting a photovoltaic array in a corporate social responsibility report in Alberta it can be listed as a carbon reduction strategy and not be viewed as greenwashing. The same report in British Columbia would be an example of unintentional greenwashing if the same emission reduction claims were made without the understanding that not all electricity is generated from the same source. This is due to making claims based on similar initiatives powered by different utility grids without taking the carbon intensity of electricity generation into account. With a good understanding of both intentional and unintentional greenwashing, the next question is why? What incentivizes corporations to continue greenwashing their corporate social responsibility reports?<\/p>\n<\/div>\n<\/div>\n\n\n\n
Corporations have large financial reasons to greenwash their corporate social responsibility reports despite increasing risk due to Federal Trade Commission (FTC) fines and third-party watchdogs such as non-government organizations and activist groups (Burbano, 2011, p.6-7; Gatti et al., 2019, p.8-9). Why take the risk when there is both financial and reputational liability on the line? There are both external and internal drivers that make this risk not only appear acceptable, but appealing. Externally, the risk-to-reward ratio is too low. The payback of greenwashing brown firms proves too lucrative for the risk of being caught further encouraging participation. Rochlin and Stevens\u2019s (Weinreib, 2015, para.7) findings demonstrated that a corporate social responsibility report can increase productivity by 13%, reduce turnover by 50%, and also attract workers willing to work for 5% less. The green technology and sustainability market in North America is forecasted to see a compound annual growth rate of 20.9% between 2022 \u2013 2029 further demonstrating profitability in maintaining a green corporate image. (Fortune Business Insights, 2022).<\/p>\n\n\n\n
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<\/figure><\/div>\n\n\n\nPenalties faced from the FTC range from cease and desist orders and fines up to $10,000 or up to one year in prison. These fines have been issued 37 times from 1990 to 2000, zero from 2000 to 2009, and five times in 2009 (Burbano,2011, p.69). The financial disincentive is minimal and seldom reinforced resulting in the only penalty being branding damage should they be noticed by non-government organizations and activists. Most corporations are safe from these organizations as they primarily focus on large well-known brands that will draw large attention from consumers and media (Burbano, 2011, p.73). Corporations may benefit from a falsified green image, but why would this encourage internal greenwashing by departmental managers? Potential high-level returns with minimal corporate risk create pressure to promote a green image, despite being a brown firm. This can be fueled by monetary incentives to managers and varying ethical climates in the workplace. Burbano (2011) states that the ethical climate of a corporation can lead to unethical behavior when an egoistic climate promoting self-interest is in place, rather than a more principled climate. Intentional greenwashing is driven by the promise of financial gain, whether it is increased revenue for the firm or personal gain for the manager through incentives. What is the real harm of financially driven greenwashing though? Can greenwashing a corporate social responsibility report really lead to physical harm of the environment and discredit climate initiatives?<\/p>\n\n\n\n
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<\/figure>\n<\/div>\n\n\n\nThe BP oil spill in the Gulf of Mexico, Deepwater Horizon Explosion, which occurred in April 2010 was and still is an ecological disaster by what appeared to be the greenest oil company at that time after its extensive Beyond Petroleum rebranding (Nastu, 2010). Accidents can happen within a company in every industry even with the most comprehensive and followed corporate social responsibility report. <\/p>\n<\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n
The issue lays in the effort put into BP Oil\u2019s rebranding initiative to be seen as a \u201ckinder, gentler, and greener oil company \u201ccommitted to cleaner and renewable energy sources while ignoring workplace regulations and environmental laws (Cherry et al., 2011, p.1014). This shirking of workplace regulations and environmental laws inevitably led up to having improper emergency protocols in place when the explosion occured. BP CEO Tony Hayward even stated that \u201cit\u2019s clear that we will find things we can do differently, capability that we could have available to deploy instantly, rather than be creating as we go.\u201d (Cherry et al., 2011, p.992). This is an example of a greenwashed brand and corporate social responsibility report used as an attempt to increase profitability and branding perception while doing little to nothing to enforce and enact the changes being claimed. The damage caused by such actions is not limited to the physical event such as the oil spill. Misleading consumers by using greenwashing techniques into thinking they are making environmentally sound decisions can lead to an increase in unsustainable practices that said consumer is trying to avoid, such as the Innisfree product mentioned earlier. This deception is not only damaging to the environment, but also to climate action initiatives as every case of greenwashing undermines climate action credibility and increases skepticism amongst environmentally conscious consumers and activists. Burbano (2011, p.9) believes that unchecked greenwashing will lead to increased cynicism that will damage the green product and green services market. The Deepwater Horizon explosion and potential reduction in climate action credibility highlight the damages that can be done to the environment and climate action initiatives due to greenwashed corporate social responsibility reports.<\/p>\n<\/div>\n<\/div>\n\n\n\n
With a better understanding of greenwashing, it becomes easier to see through the carbon filled smoke screen being put up by brown corporations. It is important to ensure as future managers, activists, or consumers that we can cut through the smog that decreases transparency in greenwashed corporate social responsibility reports. The act of seeking increased profits by greenwashing corporate social responsibility reports put both our environment and families at risk as demonstrated by the Deepwater Horizon explosion and through the deceitful promotion of unsustainable practices. Furthermore, as greenwashed corporations are being discovered and held accountable through financial or reputational penalties, skepticism amongst green consumers increases hampering initiatives and products that could create a more sustainable future for our consumeristic ways. With this increased understanding of greenwashing techniques and the damage that can be caused, it becomes our responsibility to see beyond the suds and focus on what is in the wash basin.<\/p>\n\n\n\n
References:<\/strong><\/p>\n\n\n\n Avery, D. Author. (2021). Claim Greenwashing. Digital Image. https:\/\/www.dailymail.co.uk\/sciencetech\/article-9479211\/Cosmetic-bottle-covered-Hello-Im-Paper-Bottle-label-PLASTIC.html<\/a><\/p>\n\n\n\n Burbano, V., & Delmas, M. (2011, October 1). The Drivers of Greenwashing. California Management Review<\/em>, 54(1), 64-87<\/em>. https:\/\/doi.org\/10.1525\/cmr.2011.54.1.64<\/a><\/p>\n\n\n\n Canada Energy Regulator. (2022, June 30). Provincial and Territorial Energy Profiles – Alberta.<\/em> https:\/\/www.cer-rec.gc.ca\/en\/data-analysis\/energy-markets\/provincial-territorial-energy-profiles\/provincial-territorial-energy-profiles-alberta.html<\/a><\/p>\n\n\n\n Canada Energy Regulator. (2022, July 13). Provincial and Territorial Energy Profiles \u2013 British Columbia.<\/em> https:\/\/www.cer-rec.gc.ca\/en\/data-analysis\/energy-markets\/provincial-territorial-energy-profiles\/provincial-territorial-energy-profiles-british-columbia.html<\/a><\/p>\n\n\n\n Carsguide. (2022). https:\/\/www.carsguide.com.au\/ford\/falcon\/price\/2008\/g6<\/p>\n\n\n\n Cecil, L., Lagore, W., Mahoney, L., & Thorne, L. (2012, September 28). A research note on standalone corporate social responsibility reports: Signaling or greenwashing?. Critical Perspectives on Accounting (24), 350-359<\/em>. https:\/\/doi.org\/10.1016\/j.cpa.2012.09.008<\/a><\/p>\n\n\n\n Cherry, M., Sneirson, J. (2011) Beyond Profit: Rethinking Corporate Social Responsibility and Greenwashing After the BP Oil Disaster. https:\/\/scholarship.law.slu.edu\/cgi\/viewcontent.cgi?article=1375&context=faculty<\/a><\/p>\n\n\n\n Executional Greenwashing. Digital Advertisement. https:\/\/www.designyourway.net\/blog\/inspiration\/70-creative-print-ads-from-the-automotive-industry\/attachment\/ford-4\/<\/p>\n\n\n\n Fortune Business Insights. (2022, April 25). With 20.6% CAGR, Green Technology and Sustainability Market Size worth USD 51.09 Billion in 2029<\/em>. https:\/\/www.globenewswire.com\/en\/news-release\/2022\/04\/25\/2428125\/0\/en\/With-20-6-CAGR-Green-Technology-and-Sustainability-Market-Size-worth-USD-51-09-Billion-in-2029.html<\/a><\/p>\n\n\n\n Fortune Business Insights. Author. (2022, April 25). 2022-2029 North America Green Technology and Sustainability CAGR. Digital Image. https:\/\/www.globenewswire.com\/en\/news-release\/2022\/04\/25\/2428125\/0\/en\/With-20-6-CAGR-Green-Technology-and-Sustainability-Market-Size-worth-USD-51-09-Billion-in-2029.html<\/a><\/p>\n\n\n\n Gatti, L., Seele, P., & Rademacher, L. (2019, August 17). Grey zone in \u2013 greenwash out. A review of greenwashing research and implications for the voluntary-mandatory transition of CSR. International Journal of Corporate Social Responsibility, 4(6). <\/em> https:\/\/doi.org\/10.1186\/s40991-019-0044-9<\/a><\/p>\n\n\n\n John, S. (2019,December 2). The 5 most fuel efficient cars on the road today- and the 4 least fuel-efficient ones. Insider<\/em>. https:\/\/www.businessinsider.com\/most-fuel-efficient-cars-vehicles-best-gas-mileage-2019-11#:~:text=Fuel%20efficiency%20has%20improved%20dramatically,the%20least%20fuel%2Defficient%20vehicles<\/a>.<\/p>\n\n\n\n Nastu, P. (2010, March 8). BP,Shell Lead Oil\/Gas Sustainability Ranking. Environment + Energy Leader<\/em>. https:\/\/www.environmentalleader.com\/2010\/03\/bp-shell-lead-oilgas-sustainability-ranking\/<\/a><\/p>\n\n\n\n Nastu, P (Author). (2010, March 8). Environmental, Sustainability, and Social Impacts Rankings March 2010<\/em> [Digital Image]. https:\/\/www.environmentalleader.com\/2010\/03\/bp-shell-lead-oilgas-sustainability-ranking\/<\/a><\/p>\n\n\n\n Netto, S., Sobral, M., Riberio, A., & Soares, G. (2020, February 11). Concepts and forms of greenwashing: a systematic review. Environmental Sciences Europe<\/em>. https:\/\/doi.org.\/10.1186\/s12302-020-0300-3<\/a><\/p>\n\n\n\n Parguel, B., Benoit-Moreau, F., & Russell, C. (2015, January 9). Can evoking nature in advertising mislead consumers? The power of \u2018executional greenwashing’. International Journal of Advertising, (34)(1), 107-134<\/em>. https:\/\/doi.org\/10.1080\/02650487.2014.996116<\/a> Weinreib, E. (2015, October 26). The ROI of CSR: How one company generated a $600 million return. GreenBiz<\/em>. https:\/\/www.greenbiz.com\/article\/roi-csr-how-one-company-generated-600-million-return#:~:text=On%20the%20HR%20front%2C%20the,percent%20of%20that%20employee’s%20salary<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" With markets shifting to more eco-friendly products and supply chains it is only a matter of time before our consumeristic<\/p>\n