Greenwashing - is it just greenwashing?

Discussions about the impact of greenwashing have gained further momentum in recent weeks. While the climate neutrality of the FIFA World Cup in Qatar is being hotly debated, the Federal Council has published its position on greenwashing prevention in the financial sector.

What is greenwashing anyway?

Already in the definition of the term, the different views and approaches diverge widely as to the meaning of greenwashing beyond effective PR and marketing measures. The Federal Council assumes that greenwashing in the financial sector occurs namely when there is a deceptive appearance that a financial service or financial instrument has sustainable characteristics or pursues sustainability goals, which in reality does not correspond to the factual situation. The question arises: When does something no longer correspond to the factual situation and how is sustainability defined in this context at all? In the EU area, greenwashing is understood to mean only false or misleading claims in the area of environmental friendliness. Misleading communications about the social compatibility of processes and technologies are referred to as bluewashing. Here, the "blue" deliberately alludes to the color of the UN as a humanitarian organization.

What should I do as a company if I don't want to wash green or blue?

Uncertainties or the actual lack of existing regulations in the area of sustainability do not only unsettle consumers. Companies are equally affected. Legal clarity must be created in order to be able to counteract greenwashing in a preventive manner. Important: The opposite of good is not evil here, but rather a question of faith. In this context, this means that I assume that something is sustainable even though this is not factually true. Transparency and education are needed.

What does green-hushing mean?

One phenomenon that is becoming visible in the context of the general versunicalization with regard to sustainability is so-called green-hushing: I do good and don't talk about it (anymore). A study conducted in October 2022 by South Pole, which is a leading global developer of climate protection projects and solutions, shows that more than a third of DACH companies that have set themselves science-based reduction targets do not want to communicate these publicly or no longer do so. Fourteen large Swiss companies were also part of this study. We can only speculate about the reasons for this lack of communication. It is reasonable to assume that the companies consider the reputational risk of overly ambitious communication to be higher than the possible gain that would be made by announcing the reduction targets. The fact is that this strategic silence means that the economy is losing important role models who, with their innovative brand message, could be a trend-setting reference for other companies and products.

Clear regulations against greenwashing

Clear guidelines on what is understood by sustainability in Switzerland and how it should be communicated would set preventive limits to greenwashing and green-hushing. Of course, it is true that the green- or bluewasher does not automatically mutate into an ecological pioneer through regulations. However, the legal consequences of choosing the wrong washing process would be clear. It can be assumed that this would encourage large associations, such as FIFA, to be more careful in their communication. What is desirable here is not an oversized set of rules, as is the case in the EU. Rather, what is needed here is a pragmatic "Swiss finish" that has proven itself time and again in many areas over the years. Author Susanne Winkler is at the HWZ Subject specialist, course director and lecturer in the fields of accounting, controlling and sustainability. After completing her Master's degree at the University of Basel with a focus on banking, finance and controlling, she gained relevant experience in the field of auditing and regulatory consulting at one of the Big Four auditing firms. The post Greenwashing - is it just greenwashing? appeared first on Organizer.