ReGen Strategic
News that global fashion brand H&M is being sued for ‘greenwashing’ in the United States is a reminder of growing accountability for business on environmental claims.
Greenwashing is where organisations mislead on their environmental performance, in the pursuit of a competitive advantage with investors and consumers.
It can be deliberate, or accidental. Either way, it is creating increased legal, regulatory and reputational risk for companies, as well as undermining global efforts on issues like climate change.
In Australia, Santos is the first company to face legal action over the veracity of a net zero plan, and is also defending itself over the truthfulness of its “clean” gas language.
Last year, the Commonwealth Bank was forced to open its books, so that a shareholder could check whether the company had complied with its climate change policy in lending to new oil and gas projects.
With investors and consumers increasingly making decisions on the back of the perceived environmental performance of companies, regulators like ASIC, the ASX and the ACCC are cracking down.
Greenwashing undermines climate action, because it erodes trust, making life harder and less rewarding for the many trying to do the right thing.
To avoid greenwashing, you don’t need to be perfect. Just be transparent about both the good and the bad, as well as plans for improvement. And have good data.
As an ESG advisory with more than 11 years’ experience assisting our clients with communications and engagement, ReGen Strategic is well placed to assist you with this.
With all eyes on greenwashing, this is the smart thing to do, as well as the right thing to do.
This article was also printed in The West Australian.