Retailers and consumer goods firms have been quick to embrace initiatives that claim to bolster their sustainability credentials, without doing their homework first. David Burrows reports. This article appeared in ESM’s November/December 2023 edition.
In 2013, researchers at the University of Gävle, in Sweden, conducted a ‘fun’ experiment in which students were given two cups of coffee: one – so they were told – was ‘eco-friendly’ and the other was not. Most said that they preferred the taste of the eco-friendly one, but both coffees were, in fact, identical.
This is now dated research and involves only a small sample, however, it shows the potential power of marketing products as environmentally friendly or ethical (or both).
A Myriad Of Claims
Consumers say that they want more information on sustainability, and that’s exactly what the food sector has served up. Look around stores today, and there are myriad climate cues: low carbon, carbon positive, carbon neutral, climate friendly, net zero – to name a few. More are added each year.
‘Low methane’ has begun to appear in the meat and dairy aisles, for example, while ‘regenerative’ is now emblazoned on some products, too. At a November European Food Forum event at the European Parliament, research was presented involving perhaps the latest claim: food made without fossil fuels.
Are all these green claims genuine? Not according to campaigners – who warn that greenwashing has become “rampant” in supermarkets – nor the European Commission, which notes that ‘way too often these claims are made with no evidence and justification whatsoever’.
The Commission is hoping that its new green-claims directive will tighten up the rules on making environmental claims, as well as ban terms like ‘carbon neutral’. The number of eco-labels (currently over 400) is also likely to shrink.
‘Clearer Guidelines Needed’
National regulators are already on the front foot. In Sweden, the patent and market court recently agreed with the Konsumentombudsmannen (KO), the consumer watchdog, that dairy cooperative Arla had misled consumers by using terms like ‘net-zero climate footprint’ in marketing its products. The court noted that the messages give the impression that the company has fully compensated for the climate impact caused by the product, and that there is no climate footprint at all. This isn’t correct.
Arla’s head of sustainability, Victoria Olsson, said at the time, “We are disappointed in the ruling. It was never our intention to mislead anyone. At the same time, the ruling confirms that sustainability is a complicated topic to communicate on, and that clearer guidelines are needed.”
In Europe, the green-claims directive will help provide some guardrails, but Olsson makes a valid point: marketing sustainability has, in a relatively short space of time, become a minefield. What might have been seen as a safe claim to make 12 months ago could now carry significant reputational risks, not to mention a run-in with a regulator (and that’s before the green-claims directive is finalised). The decision certainly highlights the challenges that businesses face in making net zero-type claims.
Even those net-zero commitments and science-based carbon reduction targets that were happily shared and promoted by many companies in the wake of the COP26 climate talks in Glasgow, in 2021, have a bitter aftertaste, as NGOs like Planet Tracker, the Changing Markets Foundation and the NewClimate Institute unpick the plans and point out the ‘accounting tricks’ that are being used.
In the US, meat production giant JBS has had to pull aspirational claims relating to net zero because it didn’t have any evidence of how it might meet such a target.
Sustainability Suspicions
Meat and dairy companies are key targets for campaigners and regulators alike. The sector has a considerable environmental footprint, and the likes of the European Commission want shoppers to be confident in the claims that they see. Evidence and verification will be crucial, going forward, but will they be enough to assuage the growing fears of consumers that most of what they see is ‘greenwashing’?
More than half of the claims that the European Commission assessed in a 2020 report were vague, misleading or unfounded. Consumers are also increasingly suspicious: 18% of UK consumers have changed their minds about a company due to misleading green claims, according to a recent survey by KPMG, while 54% stated that they would stop buying products and services from companies found to be greenwashing.
Food and agriculture were among the sectors most likely to engage in greenwashing, the survey found.
Younger consumers appear to be particularly wary of misleading marketing. “If I found out a company was guilty of greenwashing, I wouldn’t be shocked, as it is a marketing tactic companies use to boost profits and improve their outlook,” said one member of the Future Food Movement Youth Advisory Board, made of up 17 UK schoolchildren, when they recently discussed greenwashing. They also talked of exaggerations in corporate communications, designed to ‘conceal the lack of progress’.
NGOs are similarly quick to highlight any inconsistencies. Aldi, for example, was caught out by Feedback for claiming to be ‘carbon neutral’, but only for its Scope 1 and 2 greenhouse gas emissions, which represent less than 1% of its total footprint (it is within Scope 3 where the vast majority of supermarket, food and drink company emissions lie). Aldi has since changed the claims on its website to reference Scope 1 and 2 coverage only.
Feedback has also criticised Tesco for using the visibility of its electric vehicles to market its climate credentials, when the vans represent just 0.1% of the company’s overall emissions.
The NGO has written to the regulator, the Competition and Markets Authority, with reports of ‘rampant’ greenwashing across UK supermarkets.
‘Carbon Neutral’
The term ‘carbon neutral’ has become the bad-boy pin-up of greenwashing claims and could actually be banned in the EU, as part of the green-claims directive. Serious concerns about the use of carbon offsets to claim carbon neutrality for a business or a product have been raised.
Food and drink businesses have started to pull out of the voluntary carbon market. European juice supplier Eckes-Granini, for example, won’t use the term ‘CO2 neutral’ on labels from next year, for example, while Danone (quietly) dropped its carbon-neutral certification in May. Danone added that a US class action lawsuit involving the claim had nothing to do with its decision.
Focus On Plastic
Carbon isn’t the only claim in the dock either, with plastic also a target area.
The Environmental Coalition on Standards (ECOS) and law firm ClientEarth are currently supporting the Bureau européen des unions de consommateurs (BEUC), also known as the European Consumer Organisation, in filing a legal complaint to the European Commission against Coca-Cola, Nestlé and Danone, over their use of ‘misleading’ ‘100% recyclable’ and ‘100% recycled’ claims on plastic water bottles sold across Europe.
The claims are ‘either vague, factually incorrect, or not substantiated, and may suggest that bottles can be recycled in an infinite circular loop, which is simply not true,’ the complainants argue.
Clear cues and statements are what consumers increasingly want to see, but will they get them? “We are not benefitting from any greenwashing,” Miriam Schneider, director of EU affairs at the Federal Association of the German Retail Grocery Trade (BVLH), told the European Food Forum in November. She welcomed the Commission’s move to level the playing field on green claims, but warned that the ex ante verification thereof – when you have 40,000 products – represents “quite a challenge”.
Gilles Dufrasne from Carbon Market Watch has been studying the claims that corporates are making more closely than most. “I think a big challenge everyone is facing is that companies’ communication campaigns often seem to be an all-or-nothing effort,” he explains. “Corporate efforts would be much less subject to greenwashing accusations if they were truthful about what they are doing, and what they can’t yet do.”
Silence Is (Not) Golden
That seems sensible, but there is concern that companies would rather say nothing. One in four companies has set science-based greenhouse gas emissions targets, but doesn’t plan to publicise them.
The finding, in a report by consultants South Pole in October 2022, sparked widespread concern of corporates going silent on sustainability. This was, after all, just 12 months after the COP26 climate talks, wherein businesses had rushed to make climate commitments, chief among them a promise to be ‘net zero’.
Since then, so-called ‘greenhushing’ has taken hold, as campaigners drill into claims and regulators consider the context.
‘When it comes to green marketing these days, what is not said is as important as what is,’ wrote Dominic Watkins, partner and global lead (consumer sector) for law firm DWF, in a recent blog for sustainability website Footprint. ‘Now we can’t just look at the claim in the context of the ad but the context of the company’s wider activities or even historical actions.’
Watkins has said that the safe spaces for making environmental claims have shrunk, and he isn’t alone when he warns that this could see sustainability initiatives slow further (they are already, thanks to the cost-of-living crisis). Keeping quiet is tempting, but it carries risks, too, so expect brands to become more tactical.
As experts at a recent Food Ethics Council event in London suggested: the bigger your claim, the more likely the public is to think that you are just greenwashing. The more precise or specific your claim, the more likely people are to engage with it.
