Why greenwash?

Different industries are dissimilarly prone to greenwashing and/or the perception of greenwashing. The perception of greenwashing may be more applicable to sectors who are in general considered as brown, for example, industries relying on fossil fuels, heavy industries, raw material production and processing, clothing, aviation, and shipping. But this may also apply to other “greener” industries.


“Disinformation disseminated by an organization, etc., so as to present an environmentally responsible public image; a public image of environmental responsibility promulgated by or for an organization, etc., but perceived as being unfounded or intentionally misleading.” - Oxford English Dictionary

“Greenwashing is conveying a false impression that a company or its products are more environmentally sound than they really are. Greenwashing is a play on the term "whitewashing," which means using misleading information to gloss over bad behaviour.” - Investopedia

Why greenwash?

The consumer segment, which sustainability influences its purchasing decisions, is growing fast. According to a Nordic survey, it grew by 22% over five years. This segment has an eye for organizations’ sustainability behaviour and increasingly calls them out if missteps are made.

Due to this growing consumer segment, it is, therefore, in the interest of many organizations to provide products and/or services to this segment and perhaps be perceived as greener than they actually are.

Main drivers of greenwashing:

  1. Stakeholder demand for environmentally responsible products is growing and remains stable despite an economic downturn

  2. Sales of environmentally oriented products have increased

  3. Regulation and government action is looming - current lax regulatory environment

  4. Lack of standards for communicating environmental messages

  5. Weak pressure from environmental groups

  6. Weak political pressure

  7. Size of the organization

  8. Fragile relationship with the government

Main methods of greenwashing:

  1. Misleading with words in its environmental features

  2. Misleading with visuals or graphics in its environmental features

  3. A product/service possesses a green claim that is vague or seemingly unprovable

  4. A product/service overstates or exaggerates how its green functionality is

  5. The product leaves out or masks important information, making the green claim sound better than it is

  6. Over-representing immaterial (but positive) environmental impacts but not disclosing material (and perhaps negative) impacts.

Avoiding greenwashing

It is therefore crucial for organizations not to engage in greenwashing even if only considering a potential public backlash from an evermore educated public. We at CIRCULAR usually recommend a precautionary principle and encourage our customers to follow this guideline:

  • Transparency: provide as much clarity about your environmental claims as possible

  • Portray meaningful and relevant claims; be cautious of making generic claims

  • Seek verification, when applicable, from a recognized, independent consultants or third parties

  • Do not mislead through visual cues

  • Be careful of hidden trade-offs: e.g., many products today are more energy efficient but may still be produced from hazardous or non-recyclable materials

  • If conducted appropriately, an appraisal may be received, even if shortfalls are acknowledged

CIRCULAR Solutions is a Nordic sustainability consulting firm offering services related to sustainability strategies, impact reporting, green bonds, sustainable finance, value-chain analysis, LCA, and circular economy. Get to know our service offering.