Sustainability communication and greenwashing

The topic of sustainability has found its way into every company in 2024. While many companies are still in their infancy, others have had well-staffed sustainability departments for years. Some sustainability managers focus mainly on meeting legal requirements and investor expectations. Others, on the other hand, invest in sustainable practices to secure their supply chains or use effective communication strategies to gain a competitive advantage through their actions.

"Do good and talk about it" - we believe that this adage remains relevant. The climate crisis and the loss of biodiversity must be at the center of our attention in order to combat it. The private sector has a crucial role to play. Annual climate finance must increase fivefold in order to achieve the internationally agreed climate targets. At least USD 4.3 trillion will be needed annually by 2030. In 2020, only around USD 665 billion was available, of which around 20% was provided by companies. An effective reduction of climate-related business risks is only possible through increased private sector investment in climate protection. Positive examples of companies investing in climate protection spread hope and can motivate other companies to also act more sustainably. Even if companies implement sustainability measures mainly for marketing reasons, this can help to raise consumer awareness of environmental issues and promote social discussion about sustainability.

But there is a flip side to the coin, and this is where we have arrived at the dangers of greenwashing. The sustainability platform RESET defines greenwashing as campaigns and PR campaigns "that put individual products, entire companies or political strategies in a 'green' light, so that the impression is created that the actors are acting in a particularly environmentally friendly, ethically correct and fair manner". However, the outward appearance of the greenwashed products or services does not correspond to ecological facts. The term was first mentioned in the media in the 1980s, in connection with a large-scale marketing campaign by the oil company Chevron, in which idyllic nature shots were in the foreground and the dangerous practices for people and the environment were to be painted green.

Greenwashing campaigns can lead to confusion among consumers seeking sustainable consumption. In the long term, this leads to a breach of trust and relativizes the work of companies that actually want to make a positive contribution to the environment and society. Therefore, transparency and a review of sustainability promises are necessary to make real progress.

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Avoiding Greenwashing: The 7 Sins

We would like to expand on the saying mentioned above. For sustainability and marketing teams, do good and talk about it, but also keep questioning yourself. No one demands absolute perfection from the start, but an open exchange with the target group is highly valued and strengthens relationships. As a consumer, there are a few things you can look out for in order to recognize products that only appear to be sustainable. In a study conducted by TerraChoice in 2007, the 7 sins of greenwashing were identified, which are still relevant today. For you as a company, they serve as a guide on what you should avoid in your communication:

• The Sin of No Proof describes claims that are neither verifiable nor certified by independent third parties. Even after research, no further evidence can be found, which means that these statements lose their significance. ‍
• The Sin of Vagueness refers to unclear, undefined, or very broad statements. The ecological aspect should always be specifically specified. Examples of this are statements such as "All Natural". Of course, sounds good, but it is not necessarily. Some naturally occurring substances are toxic, such as mercury or uranium. Terms such as "green" or "environmentally friendly" are also meaningless without more precise specification.
• The Sin of Irrelevance is committed when unimportant or unhelpful information and claims are used. Examples of this are statements on product characteristics that are already required by law. Such irrelevant information is distracting and aims to deceive consumers.
• The Sin of Worshiping False Labels refers to products or services that, through words or images, give the impression that they are being audited by third parties when they are not; in other words: fake labels.
• The Sin of Fibbing applies when entire statements are not true. This sin goes deep into consumer rights, because false statements are actually made. An example would be to claim that a product is made of 100% recycled plastic, but de facto only 30%.
• Sin of the Hidden Trade-Off describes the practice of highlighting a product as green based on a single attribute. An example of this is the emphasis on the recycled content of a material, while less sustainable properties are concealed. While such statements are not inherently false, they can still be misleading, as they only shed light on one aspect. Be sure to evaluate the product in its entirety.
• Companies commit the Sin of Lesser of Two Evils when environmental labels such as "organic" or "green" are applied to products where the entire product category is of questionable ecological value. These claims deceive consumers.

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The EU issues guidelines against greenwashing

In addition to companies, politicians are also called upon to take action against greenwashing through a clear legal framework. The EU has recognised this. The EU Green Claims Directive aims to combat greenwashing and increase transparency in sustainability communication. It is a challenge for consumers to make informed, sustainable purchasing decisions, as a jungle of sustainability labels and misleading claims have flooded advertising in recent years. The status quo of sustainability claims is frightening when we look at these figures:

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In January 2024 , the European Parliament gave the green light to a law to improve sustainability labels and ban the use of misleading environmental claims. In the future, as a company, you will have to scientifically substantiate your environmental claims and provide detailed, verifiable data. Terms such as "environmentally friendly", "biodegradable" and "climate neutral" may no longer be used in advertising or on packaging without concrete proof. In addition, the directive prohibits the claim that a product is "climate neutral", "CO₂-reduced" or "climate positive" due to CO₂ offsetting. Companies must clearly state how and where the CO₂ reductions or removals will be achieved and ensure that these projects deliver additional benefits beyond existing measures.

Once the new rules are introduced in the member states, only sustainability labels that have been checked by official certification schemes or set by public authorities will be allowed in the EU. It is not yet fully clear how exactly the verification of the information in Germany will work from 2026. We will continue to follow the developments on the Green Claims Directive and the exact design of the laws and keep you up to date.

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How you can successfully communicate sustainability projects

Criticism of the lack of transparency in many sustainability statements is justified. But how can you as a company credibly communicate your commitment?

In the communication of our projects, which support farmers in the integration of regenerative measures , we focus on the valuable work of Klim farmers who cultivate our soils sustainably. Soil is not only irreplaceable for our food supply, its importance goes much further. It may come as a surprise to some that soils store more carbon than all the world's forests combined. In addition, soil is crucial for the protection and promotion of biodiversity.

At Klim, we want to tell authentic and moving stories about one of the world's most important resources to inspire others to do the same to protect soils, and thus biodiversity, food security and climate. Thanks to our digital platform, we know exactly what is happening on farms, what services farmers provide for our ecosystems and how much CO₂ is being reduced and stored. We encourage our partners to communicate the facts about emission reductions and contributions to climate protection projects outside the supply chain transparently and clearly.

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From greenwashing to greenhushing

Greenhushing describes the deliberate withholding of information about environmentally friendly practices and sustainability initiatives by companies. Instead of actively communicating sustainability initiatives, some companies choose to hide this information for fear of criticism, legal consequences or mistrust. But is this the right strategy?

Transparency in your sustainability initiatives is crucial to gaining and maintaining the trust of your stakeholders. Greenhushing could significantly affect this trust. A lack of information is often seen as a sign of a lack of concrete action. In addition, the legal requirements for transparent reporting in the EU are becoming increasingly stringent as a result of the CSRD. In the future, you will not be able to avoid reporting comprehensively on your sustainability initiatives!

How do companies implement this? Our partner BABOR BEAUTY GROUP has made the reduction of emissions a central aspect of its sustainability strategy and has already achieved a reduction of 47%. They communicate this very transparently. At the same time, they make it clear that it is not possible to completely avoid emissions under the current technical conditions. That's why they decided to invest money in climate protection projects outside their own supply chain - and to support Klim farmers in the regenerative transformation. With Babor's support, farmers are implementing regenerative measures on an area equivalent to the size of 5,000 football pitches that build up humus and store carbon.

The holistic benefits of regenerative agriculture convinced Babor of Klim and they actively use them in their communication, such as in this announcement post:

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Would you like to learn more about Klim's projects in regenerative agriculture? Feel free to ask our team for more information!