The sins of greenwashing

Greenwash is a relatively new term that has started springing up in various publications and across mainstream media. According to Wikipedia, greenwash is the act of misleading consumers regarding the environmental practices of a company or the environmental benefits of a product or service.

In December 2007, TerraChoice, an environmental marketing company in North America, released the findings of a study titled 'The Six Sins of Greenwashing'. The company, a leader in green marketing, found that 99% of the 1018 common 'environmentally friendly' consumer products randomly surveyed for the study were guilty of greenwashing. The findings of the report were alarming and from it the company created the six sins of greenwashing, which it believes will help equip consumers with the tools to figure out the truth about environmentally friendly products. They define the six sins as:

• Sin of the Hidden Trade-Off: eg, 'Energy-efficient' electronics that contain hazardous materials. 998 products and 57% of all environmental claims committed this sin.
• Sin of No Proof: eg, Shampoos claiming to be 'certified organic', but with no verifiable certification. 454 products and 26% of environmental claims committed this sin.
• Sin of Vagueness: eg, Products claiming to be 100% natural when many naturally occurring substances are hazardous, like arsenic and formaldehyde. Seen in 196 products or 11% of environmental claims.
• Sin of Irrelevance: eg, Products claiming to be CFC-free, even though CFCs were banned 20 years ago. This sin was seen in 78 products and 4% of environmental claims.
• Sin of Fibbing: eg, Products falsely claiming to be certified by an internationally recognised environmental standard like EcoLogo, Energy Star or Green Seal. Found in 10 products or less than 1% of environmental claims.
• Sin of Lesser of Two Evils: eg, Organic cigarettes or 'environmentally friendly' pesticides - this occurred in 17 products or 1% of environmental claims.

In Australia, organisations like the Total Environmental Centre (TEC) are similar in that it monitors claims by companies and organisations that promote themselves as 'green'. Established in 1972 and with over 100 successful campaigns under its belt, TEC's executive director Jeff Angel says it's necessary to have watchdogs because government can move too slowly and be constrained by political links to vested interests.

In 2006, the TEC was concerned that Energy Australia was making representations on its website and in promotional material that its ClearAir and GreenFuture products would provide "100% green electricity at no extra cost" and "100% renewable energy". A related representation was that "for every kilowatt hour of electricity you buy, the same amount of electricity will be generated from 100% renewable sources, and that's guaranteed", which TEC says were simply false claims.

The ACCC investigated Energy Australia's claims after a complaint was received from the TEC. Whilst Energy Australia withdrew the products from the market in 2006, the ACCC was concerned that Energy Australia's representations may have led consumers to believe that by signing up to the non-accredited ClearAir and GreenFuture products, they would be making equal or similar contributions to renewable energy generation as accredited renewable energy products when this was not the case.

The ACCC was also concerned that consumers may have believed that one environmental benefit of opting to receive these products was that less electricity would be generated from fossil fuels when in reality Energy Australia was acquiring renewable energy credits from existing rather than new renewable energy generation.

"It's been very misleading. We have received many complaints and expressions of confusion. People want to make a difference but instead they have been tricked into thinking the green electricity product would make a 100% change in emissions, when it was very little," says Angel.

Since the investigation, Energy Australia has written brochures outlining to existing customers the differences between environmental accredited and fully accredited 100% Green Power products and the environmental benefits of both.

Angel says that when the need arises, like the case with Energy Australia, TEC works closely with the ACCC and believes it's inevitable that we will see more misleading claims by companies that promote their green products and credentials.

"Most recently they [ACCC] have been consulting with a wide range of stakeholders, including TEC, about carbon offset and neutral products."

TEC say that it will continue to watch out for greenwashing by Australian companies.

"We are continuing with our Green Electricity Watch, along with undertaking a rating survey of carbon offset products which are experiencing multimillion dollar growth. Also, our Green Capital program is likely to have a major greenwashing debate later this year," he says.