Identifying Greenwashing In

Your Supply Chain

Why it matters

According to ClientEarth, greenwashing is “where a company uses advertising and public messaging to appear more climate friendly and environmentally sustainable than it really is. It’s also a technique used by certain companies to distract consumers from the fact that their business model and activities actually do a lot of environmental harm and damage.”

With the rising importance of ESG issues, there exists real value for organisations in demonstrating a commitment to progress on climate change and other material environmental issues, and being transparent about the maturity of their environmental strategy.

Identifying Scope 3 emissions (greenhouse gas emissions attributable to the corporate value chain including suppliers) is a complex challenge for businesses.

If members of your supply chain are using greenwashing techniques, whether purposely, mistakenly, or through ignorance, your own sustainability credentials will be undermined, causing harm to your business and reputation, not to mention the environment.

Conversely, environmental issues are an area of concern for employees and potential new recruits and, as such, can be used as a tool to engage and encourage agency. As awareness of topics such as climate change increases, it is much less likely that individuals will trust unsubstantiated or unclear claims made by their own or other organisations.

Following independent guidance and frameworks such as Greenhouse Gas Protocol tools will help to provide confidence in environmental reporting.

Identifying and removing greenwashing practices from the supply chain is therefore imperative for any organisation serious about achieving a net-zero future.

Types of Greenwashing

Planet Tracker’s ‘The Greenwashing Hydra’ report identifies six different practices:

  • Greenhushing – leaving things unsaid, sometimes even the good things for fear that being vocal will lead to greater scrutiny
  • Greenrinsing – regularly changing targets before they are achieved to disguise insufficient action while also signalling proactivity
  • Greenlabelling – branding things as green which may or may not be justified depending on the credibility of the labelling scheme
  • Greenshifting – asserting that your hands are tied and passing responsibility onto others in the supply chain
  • Greenlighting – showcasing positive activities and results in order to distract from the bad
  • Greencrowding – hiding in a group and being satisfied to move at the pace of the slowest group member.

Greenwashing red flags to look out for in your supply chain

  • Using generic terms such as green or eco-friendly or conversely using jargon to baffle customers
  • Making claims without providing the evidence to back it up
  • Hiding inconsistencies by spotlighting achievements that relate to a small part of a bigger picture eg. focussing on a topic or project such as tree planting without disclosing progress on material environmental issues such as sustainable use of raw materials, production energy or fossil fuel interests/investments
  • Making grand commitments without having a plan to achieve the goals
  • Promoting certifications that aren’t based on rigorous or scientific measurement or haven’t been independently verified
  • Communicating evolving future targets without demonstrating progress made against previously communicated targets.

Greenwashing challenges for businesses

  • There is no single piece of legislation or regulation that governs greenwashing
  • There is no standardised holistic approach for assessing the impact of the entire lifecycle of a product or service
  • Supply chains can be complex and opaque
  • Significant investment of time and money is needed to keep up with the pace and cost of change.

We can help you with

  • Taking action against suppliers relating to greenwashing practices identified in your supply chain
  • Reviewing your environmental claims, identifying any statements that may fall foul of advertising and consumer protection regulations
  • Responding to greenwashing claims made against you
  • Advising on the development of risk and crisis management plans in relation to greenwashing issues
  • Reviewing existing commercial contracts for greenwashing weak spots and advising on commercial clauses to protect you from greenwashing in your supply chain
  • Training and horizon scanning in relation to proposed and developing UK and EU regulation of green claims
  • Sharing our experiences of developing an environmental strategy and progressing to milestones such as verifying our climate targets via the Science Based Targets initiative (SBTi).

Georgie Collins

Partner

+44 (0)20 7421 3997 +44 (0)7876 253 304 georgie.collins@irwinmitchell.com

Claire Petricca-Riding

Partner

+44(0)1612 591 667 +44(0)7867 681 990 claire.petricca-riding@irwinmitchell.com