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Brand Strategy Greenwashing Sustainability

In a world of greenwashing and ‘greenhushing’, has transparency lost its meaning?

By Jennifer Black, Sustainability Reporting Director

Radley Yeldar

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March 6, 2023 | 6 min read

Radley Yeldar’s Jennifer Black looks at the current sustainability reporting landscape across the world. Is some brands’ empty talk of ‘transparency’ occluding real progress?

A paintbrush on a green background

Are greenwashing and now greenhushing making corporate transparency meaningless? / Engin Akyurt via Unsplash

The push for transparency isn’t new. In fact, the word ‘transparency’ has become so commonplace in a sea of purpose-driven brand campaigns, statements, and technically compliant disclosure requirements, that it’s lost all meaning. Are businesses obsessing over ‘transparency’ to avoid considering real operational impact?

It’s complicated. The push for transparency has led to a rising tide of disclosure requirements, leading businesses to reveal a widening spectrum of detail and data about their operational impact. But how relevant are these disclosures to the issues they address? Does more data mean more progress? Clearly not.

Businesses often don’t have the in-house sustainability knowledge and expertise to navigate the complex landscape of reporting requirements, meaning they can’t action meaningful plans. So they instead obsess over ever more complex disclosure standards – and often choose token initiatives for public comms. This dilution of the concept of transparency has led to disappointing outcomes. We’ve seen a rise in greenwashing where environmental commitments and claims are exaggerated. But stakeholders and regulators are keenly aware of this now. Many businesses have been burned with controversy. As a result, there’s a trend towards ‘greenhushing’, or the avoidance of talking about impact altogether.

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Greenwashing’s steep cost

There’s been a move toward greater scrutiny of businesses claiming to be ‘doing the right thing’ when they’re not. Accusations and fines to combat greenwashing are coming in thick and fast. Think HSBC, BNY Mellon Investment Advisor (which was fined $1.5m for greenwashing by the US SEC), and more recently, Black Mountain Energy, fined by the Australian Securities and Investment Commission over “allegedly false or misleading sustainability statements”. This list keeps growing.

In the UK, Sustainability Disclosure Requirements (SDR) proposed by the Financial Conduct Authority (FCA), are a sign that greenwashing’s days are numbered. Through the SDR, the FCA is proposing to introduce a package of measures aimed at clamping down on greenwashing. This includes sustainable investment labels, disclosure requirements and restrictions on the use of sustainability-related terms in product naming and marketing.

Meanwhile, the Green Claims Code from the ASA places the onus on companies to validate, in clear context, the claims they’re making on environmental benefits. This regulation is changing the game. We can expect tighter regulations to follow in other jurisdictions.

Embracing transparency with personality

Genuine transparency remains crucial for effective reporting and communication. It goes beyond simply meeting disclosure requirements, and instead involves lifting the lid on authentic learnings, challenges, and opportunities for fundamental operational change. But it's important to remember that transparency is not an end in itself. It's a means to a different end: genuine action, and progress, on environmental and social issues.

A powerful way to build trust and loyalty with stakeholders is to inject some sincerity into your communications. Ace & Tate, a Dutch eyewear company, owned up to its failings, setting out their past “bad moves” through an honest blog. This refreshingly honest and open approach helped the company to build a loyal following and enhance its brand equity.

Microsoft adopted one of the most ambitious carbon reduction goals in the marketplace, aiming to become a carbon-negative, water-positive, zero-waste company by 2030. Its Environmental Sustainability Report records annual progress, pledging “transparency in our progress” with the intention of sharing lessons for others to learn from. It’s also a way to hold itself accountable to its ambitious goals. It remained true to that pledge, even when things didn’t go its way.

Ace & Tate and Microsoft are two examples from a small pool of companies that dare to be that transparent. But, encouraged by consumer demands and prompted by increasingly stringent regulations, more businesses are starting to recognize genuine transparency. The more that robust and decision-useful information is shared, the greater we can combat the greenwashing and ‘greenhushing’ that undermines the credibility of sustainability efforts and use the data we’re disclosing as a map to the real changes we all know we need.

Brand Strategy Greenwashing Sustainability

Content by The Drum Network member:

Radley Yeldar

Radley Yeldar is an award-winning, independent, London and Birmingham-based creative consultancy. Our 200-strong team of specialists has been helping to create a...

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