You’ve likely heard of greenwashing, a term coined in 1986 to describe companies and industries that were notoriously bad for the environment, but that marketed positive benefits for the planet in order to mislead consumers. But what about 'good-washing'?
In an economy where consumers are more motivated than ever to purchase consciously and support brands that share their values, I believe we are at a tipping point in the movement to transform business into a force for good. Those of us who claim to be founded “on purpose" need to be vigilant in calling out those who would leverage conscious capitalism to cover up or manage wrongdoing, or we risk alienating the very consumers who are motivated to support socially responsible businesses.
We also need to model good behavior when it comes to spending our B2B dollars with like-minded companies. Ad agencies should not enable good-washing efforts by our clients. If you are, say, a large purpose-driven tech company or an organic food manufacturer, and you aren’t working with a purpose-driven agency, well, then, what’s up with that?
When I started my agency, I was considered an oddball for focusing so much on our values and social impact. (I remember one client prospect referring to me as a “hippie.”) But now, that’s all changed, and so has the company. We’ve grown even more hell-bent on differentiating ourselves on purpose and now satisfy strict annual workplace certifications like B Corp and GoodWell to actually prove to our clients, community, and ourselves that we really do what we say and mean what we do.
So it irks me when corporations conduct compelling “good-washing” efforts to capitalize on purpose-driven consumers’ desires to shop responsibly, often, at the expense of the holistic truth. The same goes for advertising agencies that create special divisions to respond to this as a superficial sales opportunity while reporting up to large holding companies that are more interested in pennies per share each quarter than they are about fundamental change in the way they or their agencies operate.
In this era of “fake news” and historically low trust in institutions of all kinds, data is more important than ever. Consumers are susceptible to “goodwashing” campaigns, and those of us who believe business can change the world must do better to create a culture of accountability.
To paraphrase Slim Shady, “Will the real good companies please stand up?” Radical transparency and pursuing workplace certifications—independent verifications by a third party that “prove” an employer lives up to its stated values—are a couple of tools to cut through the chatter and differentiate your brand as one of the truly good ones.
If you are trying to sell your agency’s higher-ups or a client on a workplace certification, the data backing up the opportunity is on your side. Now, more than anytime in modern history, Americans more inclined to believe that business can solve problems better than the government can.
Sixty-six percent of consumers would spend more on a product if it comes from a sustainable brand, according to Neilson’s Global Corporate Sustainability Report, a figure that jumps to 73 percent among Millennials. On the heels of BlackRock’s CEO’s January 15 letter calling for companies to consider their social and environmental impact rather than just financial returns, I predict fewer large, public companies will think it’s worth risking the fund’s $6 trillion under management to take goodwashing shortcuts for near-term financial gain. Hopefully, more major companies will consider becoming public benefit corporations and enshrine long-term sustainability and accountability in bylaws.
Ultimately, Millennial consumers have a lot of power here, and I think the BlackRock decision is largely in response to them. More than any other generation in history, they care about consciously consuming goods and services and make purchasing decisions based on their values. A Nielsen report in 2015 found that three out of four Millennials are willilng to pay more for products if they are sustainably produced. And this generation is already spending about $200 billion annually. Just look at how multinational corporations like Unilever and Danone have moved in a more positive direction of late.
Taking a stand is increasingly good business – and a great way to build public awareness about trustworthy purpose-driven brands. Last year, JUST Capital again found that the 100 companies that do well by their employees, community and the environment have less stock volatility and better overall returns over time. Writing in the Washington Post last year, reporter Jeff Guo cited research measuring the loyalty of Apple customers after CEO Tim Cook came out as a gay man. Naysayers thought a lightning rod issue like LGBT rights might put off investors and shareholders, but with results like Apple saw, instead, the moment became a testimony for brands standing up for social justice.
Similarly, Patagonia, a public benefit corporation, clapped back at President Trump’s anti-monument executive order by blackening its homepage with “The President Stole Our Land” after he shrunk the Bear’s Ears National Monument in southern Utah, an unprecedented attack on America’s public lands. The move inspired me to purchase Patagonia jackets for our entire staff as a year-end gift. I wasn’t alone in thanking the outdoor retailer and benefit corporation with my dollars.
“Anytime we do something good for the environment, we make more money,” the company’s CEO, Rose Marcario said in recent Bloomberg story.
If you are an agency exploring certification or a change to a public benefit corporation, I’m happy to chat about my experience. Reach me at firstname.lastname@example.org or @rstoddard on Twitter.
Russ Stoddard is the president and founder of Boise, Idaho based B-corp/ creative agency, Oliver Russell.