I knew something was wrong the moment I walked in the door.
I had just stopped in to check on a job recently for a new client, when a burning chemical smell assaulted my senses. After checking on our technicians to make sure they were OK, it didn’t take me long to trace the source of the harsh fumes. Not far from our team, a worker from another company was stripping and waxing our client’s floor.
My first thought was there must be a mistake. Our client prioritized using environmentally friendly alternatives at their facility and the service truck in the parking lot was from an “Eco” branded company. So I checked out the chemicals this “green” company was using and I quickly found the answer: greenwashing.
This company, like so many others in real estate services industry, clearly recognized the growing appeal of sustainability by marketed itself as green to environmentally minded clients but it failed to provide true sustainable services. The proof was right there in the toxic bottles of chemicals I was inspecting that will never earn a Green Seal certification, EcoLogo label nor contribute to a single LEED rating point.
Everywhere you look today you’ll find “green” companies that use branding to evoke environmental friendliness – leaves, water, the Earth, etc. – but peel back the layers and you’ll often find little substance to their sustainable story.
Regulators have responded to this trend. Last year, the Federal Trade Commission released an update to its Green Guides, which provides guidelines on how businesses should incorporate environmental messages when marketing their products and services. Though the revisions were part of a planned update of the guides, Laura Koss, a senior attorney with the FTC, said the changes were driven in part by demand from public agencies, businesses and consumer groups “to help create a level playing field in environmental marketing.”
“I do think that as long as this is an area that is hot in the market place, the FTC will make an effort to enforce deceptive marketing claims,” said Koss, who pointed to a number of businesses who have been cited for making false claims regarding the environmental benefits of their products and services.
But the few dozen enforcement actions the FTC reported since the 1990’s hardly scratches the surface of the green marketing claims that exploded in both the consumer and B2B marketplace the past several years. It is clear that regulators cannot pursue every questionable environmental claim and that has helped propel a push from the private sector for more product transparency, including the building sector. For example, a group of building industry experts rolled out the Health Product Declaration Open Standard last year to provide a standardized format for building product disclosures.
Yet, according to Jennifer Atlee, a senior research associate with Building Green, green certifications of building products are a “mess” as there are many competing standards with varying degrees of rigor.
“Standards and certifications are all over the map right now,” Atlee said in a recent webinar.
Better regulatory enforcement and stronger commitments by the private sector to identify and meet clear standards for environmental performance will help move the marketplace away from greenwashing. But that only focuses on the cadre of players who are either concerned with regulatory scrutiny or truly care about their environmental impact. Meanwhile, a significant slice of the marketplace will continue to greenwash their customers with false claims of environmental benefits. As a result, business and consumers must be educated and on guard when presented with green products and services to determine what is real and what is not. That, in turn, forces truly green companies to fight harder to stand out from all the greenwashing.
It isn’t easy. I should know. I’ve seen plenty of sophisticated real estate organizations with rigorous vetting processes buy into greenwashing. I’ve also been deceived.
Last year, we started a business relationship with an individual who presented what appeared to be a substantial history of inventing green products. This person provided us with extensive documentation and a track record of third-party vetted experience, supported by awards from various agencies and extensive media coverage by respectable outlets. We hired attorneys and other professionals to help us assess the business and we never turned up a clear red flag. It was only after we began working with him and things started going wrong that we started piecing together the truth of this individual, that what he really invented was an elaborate deception. He is under investigation for multiple allegations of fraud and we have since sought to distance ourselves from him.
The hard lesson here is that even someone like me, who has a deep understanding of sustainability and a nose for sniffing out greenwashing, can still be misled. And what is greenwashing, but a deliberate attempt to deceive by making unjustifiable claims about a product or service for wrongful gain? Isn’t that essentially the definition of fraud? Is it time we started treating all greenwashers as frauds?
Michael Gottlieb is the Managing Partner of Advanced Green Solutions.
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