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Olivia Thompson

CO300

2 May 2022

Goodbye Greenwashing: Returning Control to Consumers

Greenwashing is when a false impression of environmentally conscious practices is

conveyed by a company–typically for the purpose of marketing. In the growing age of

environmentalism, profit driven companies market to consumers in a “green” way that is not

representative of the companies’ overall practices (Noyes). A large issue with greenwashing is

that it creates a lack of accountability for companies that profit off of falsely “green” claims

(Noyes). Not only does this prevent consumers from having control over their decisions, it also

prevents large environmental progress from being made as companies continue to falsify their

practices. In order to keep companies accountable for their sustainability claims and to bring

control back to consumers, The Federal Trade Commission must provide stricter regulations on

company claims, update its Green Guides, allocate funding towards more education on

greenwashing and fraud, and incentivize companies to have transparency with consumers.

The FTC must put greater focus and restrictions on organic claims. Validating all green

claims is challenging so it is important to focus on one first: organic claims. This is one of the

most commonly misused claims and would be a large step towards greater accountability within

the realm of marketing for companies. For many years, the Federal Trade Commission has

passed off the oversight of organic claims to the USDA, as they focus on agricultural products

and their advertising (Rotman). The dilemma that ensues is the lack of oversight of products that

claim to be organic, yet do not fall into the agricultural realm. Many nonagricultural products

produced by “home goods and personal care” companies label their products as organic without

any credibility (Rotman). When looking at agricultural regulations on claims, the National
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Organic Program (NOP) has strict rules on organic claims–down to the “percentage of organic

ingredients'' listed on the items (Rotman). As nonagricultural company products–shampoos,

lotions, pillows, mattresses, and more–are targeting consumers that chase the “green” products,

many consumers are buying into falsifying companies and products (Rotman). The lack of

oversight and enforcement on these claims requires immediate addressal from the FTC. The FTC

must increase their coordination with the USDA NOP to bridge the gap between agricultural and

nonagricultural organic product claims. Allocating a portion of their budget to hiring a team of

sustainability specialists to validate these specific claims would create greater enforcement of

these regulations, and ultimately cut down on this key aspect of greenwashing in the product

world.

The FTC must also alter its Green Guides–the guidelines for marketing that can be done

by companies. It needs a revision which would provide guidance on Organic claims, and it must

be categorized as binding regulations and not just guidelines for companies. When the Green

Guides are considered binding regulations, the FTC will be able to take legal action in order to

keep companies’ marketing strategies in accordance with the contents of the guides. The FTC

has been planning to “initiate the next revision of the Green Guides” this year (2022) and “the

foundation is well laid for the addition of a section on organic claims” (Rotman). The previous

revision in 2012 chose to not provide an organic section as there was “insufficient evidence that

consumers were deceived by organic claims” (Rotman). Now observing the amount of

companies falsely claiming to be organic, the FTC must address this specific claim in their 2022

revision. There should be the adoption of an “accreditation and certification program for

manufacturers of “organic” non agricultural products similar to the certification of organic

growers by accredited certifiers under the NOP” (Rotman). This system has been largely
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“successful in maintaining the integrity of ‘organic’ claims for agricultural products” and would

provide the same success with these products.

Along with provisions on organic claims, the FTC should provide incentives for

companies that are transparent with their practices. Money is arguably one of the biggest drivers,

so providing government incentives and tax breaks for transparent companies would reduce high

levels of greenwashing. South Korea has seen tremendous green growth during the past years

with this initiative. South Korea's “Five-Year Plan outlines government actions for

implementation of the strategy, and detailed tasks for ministries and local governing entities as

well as specific budgets” (TBS). It is detailed that “under the plan, the government will spend

approximately 2% of annual GDP on green growth programmes and projects’ and “investments

will initially be geared towards infrastructure development in order to boost the economy”

(TBS). Reports explain that “in 2020, South Korea invested around 374.28 billion South Korean

won in green technology” and “there were 127 green companies that were designated by the

South Korean government” (TBS). These strategic action plans in South Korea have resulted in

not low levels of greenwashing, but also a climate-conscious and progressive society. Similarly,

the FTC could allocate funding to rewarding green companies, eventually creating a pathway for

more government agencies to reward green companies. Observing the progress made in South

Korea, it is more than possible for other countries–like the United States–to follow in their

footsteps.

Arguably, one of the most crucial steps that the FTC must take to cut down on

greenwashing is to create more education geared towards consumers about this on-going issue. If

the FTC allocates more funding towards consumer education, control is given back to consumers

and they are able to be informed in their decision making. In the growing technological age, false
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information can be distributed instantaneously. In order to combat this, the FTC must hire a

marketing team to distribute education on greenwashing through more technological avenues:

Social Media. Targeting consumers through social media has spread mass awareness for

political, environmental, and social issues in recent years. Informing consumers online that the

products they purchase may not be what they really think is going to inform and spread crucial

information to bring control back to consumers.

A counter argument tends to linger regarding greenwashing as not being beneficial in the

long term, yet it begins the process of change. Companies that make small green claims that are

not representative of their overall company still encourage other companies to do the same. This

normalizes the “Green” movement. While greenwashing has been criticized due to its somewhat

false emotional appeal to consumers–as they believe they are purchasing a “green” or

environmentally friendly product–it may be necessary in order to take small steps towards an

improved status quo for consumer companies (Holmes). A controversial example of the Boxed

Water is Better company is utilized to explain this phenomenon. This company’s product of

boxed water is lined with plastic and is only cardboard on the outside, yet it claims to be

eco-friendly (Holmes). Holmes argues that it is a small “win” as it provides much less plastic

than a stereotypical plastic water bottle (Holmes). In order for humans to become aware of the

“all the trash [they] create,” there needs to be “gradual” change in consumer products (Holmes).

Holmes explains that while many materials like paper and plastic can be recycled, paper has a

much longer half-life compared to plastic–which can be reused more and prevent more material

from being produced in the long haul. Small changes that are not zero-waste present themselves

as “normal” to consumers (Holmes). Holmes describes that many people could carry a reusable

water bottle with them, but do not because it lacks convenience as well as it is not “normal” yet.
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Society may reject fully green products as “outliers” and “weird” due to the lack of normality

(Holmes). These products that are not as “green” as they claim to be are the stepping stones to

more fully sustainable practices and will ultimately lead to “success” in the “green” movement

(Holmes).

Some argue that when consumer transparency is low, there will be higher overall

corporate social responsibility spending that can lead to increased social welfare for companies.

When transparency increases too much, these benefits can often dissipate. While greenwashing is

viewed as a way of deceiving consumers into buying into a company that appears to be

sustainable, it may be “[increasing] socially beneficial investment” (Wu et al.). CSR, or

corporate social responsibility, is where a company appears to hold social responsibility in terms

of sustainability or environmentalism. In recent years, CSR practices have grown in popularity

with companies to demonstrate themselves as environmentally conscious companies. Two

different types of companies can be observed: socially responsible companies and profit driven

companies. (Wu et al.) Both companies appeal to CSR, but for different reasons. Socially

responsible companies contribute to CSR activities not for the purpose of money but through the

implication that it is their responsibility, while profit driven companies do it in order to profit

from it. (Wu et al.). When CSR is used as a “marketing gimmick” by these companies,

greenwashing becomes heavily prevalent (Wu et al.). When observing company and consumer

integration, lack of transparency with consumers and companies’ sustainability practices actually

can be beneficial. Besides the misinformation and deception that is caused to consumers, lack of

transparency can increase “overall CSR spending” (Wu et al.) When the consumer is buying into

a company–but lacks true evidence of how “green” the company is–“from a welfare perspective,

the information loss can be recovered by the profit maximizer’s CSR investment if the
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information transparency is not too low” (Wu et al.). From this perspective, this “reveals the

positive aspect of greenwashing: it increases socially beneficial investment” (Wu et al.). The

positive nature of low transparency is “the motivation that incomplete information gives to a bad

firm to invest in social causes, which would not exist if consumers could distinguish a bad firm

from a “good” firm” (Wu et al.). It is described that “when the transparency level is low,

greenwashing arises, and higher transparency strengthens the positive aspect of greenwashing

and raises the social welfare” (Wu et al.). This approach looks deep into CSR spending and

social beneficial investment as a way that greenwashing provides benefits for companies.

When considering the money that greenwashing companies value, transparency with

consumers has shown to create loyal customers and build strong foundations for the companies

that will provide high amounts of profit in the long run. When considering communications

between consumers and companies, “we distance ourselves from viewing transparency as a

corporate concept and see it for what it is — a real human quality” (Steele). It is reported

that“94% of consumers are more likely to be loyal to a brand that’s completely transparent”

(Steele). This loyalty transpires due to “transparency [building] trust, trust that is foundational to

your relationships with your employees and customers” (Steele). Practically, “business continuity

is based upon friendly, open companies as well as initiatives that imbue sustainability and

transparency within them are material success factors” (Steele). Loyalty is a monumental driver

of profit for companies. Establishing how the increase in transparency–thus loyalty–will benefit

the monetary value of a company is going to incentivize more companies to reduce their

greenwashing.

While the FTC has control of limiting greenwashing within marketing, there is now a

vital responsibility on consumers to stay informed and to question the intentions of some of the
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most beloved companies. It is necessary for consumers to look towards greenwashing education

and research to foster a generation of powerfully informed consumers. Education and research

are the greatest proponents of consumers once again having control and power over their

decisions. It is important to now consider claims made by companies to not always be fully

accurate and to challenge ourselves to search deeper than trusting in a claim made on the front

of a label. We must do our research to stay continuously informed and to challenge companies on

their environmentalism in order to continue the environmental progress that we strive to bring

about.
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Works Cited

Holmes, Audrey. “Can Greenwashing Ever Be Good?” Earth911, 9 Aug. 2017,

https://earth911.com/business-policy/greenwashing-good/.

Noyes, Lydia. “A Guide to Greenwashing and How to Spot It.” EcoWatch, 31 Dec. 2021,

https://www.ecowatch.com/greenwashing-guide-2655331542.html.

Rotman, Robin M. et al., Greenwashing No More: The Case for Stronger Regulation of

Environmental Marketing, 72 Administrative Law Review 417 (2020).

https://scholarship.law.missouri.edu/facpubs/972

Steele, Gary. “Council Post: Green Business Is Good Business: Why Transparency Is Key for

Corporate Sustainability.” Forbes, Forbes Magazine, 10 Feb. 2021,

https://www.forbes.com/sites/forbesbusinesscouncil/2021/02/11/green-business-is-good-b

usiness-why-transparency-is-key-for-corporate-sustainability/.

TBS Report 16 March, and TBS Report. “Special Incentives Needed for Green Financing in All

Sectors: PRI.” The Business Standard, 16 Mar. 2022,

https://www.tbsnews.net/bangladesh/environment/special-incentives-needed-green-financ

ing-all-sectors-pri-386270.

Wu, Yue, et al. “Bad Greenwashing, Good Greenwashing: Corporate Social

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Responsibility and InformationTransparency.” Management Science, vol. 66, no.

2020, pp. 3095–3112., https://doi.org/10.1287/mnsc.2019.3340.

Self Assessment:

EXTENDING RHETORICAL AWARENESS IN A PARTICULAR SITUATION: (A-)

I think that I chose the best stakeholder for this situation that could actually make a

difference (The FTC). I wanted to also include consumers (us) as a whole to do our part, which

may have gotten a bit neglected in my paper, but I was unsure of the best way to present that

material. I think that introducing consumers as another stakeholder at the end as a parting

message was a good choice and I liked how that turned out. I considered how the FTC would

make a difference and how each idea and action plan was completely possible to be implemented

in the future. I think I would improve on explaining the constraints of each target audience and

how to combat them.

INTEGRATE QUALITY SOURCES, USE COMPELLING AND CONVINCING EVIDENCE: (A-)

I think I had a really good process of finding good sources and evidence that would

appeal to both audiences in multiple different ways (ethos, logos, pathos). I am happy and proud

of the integration of stats with logic and more emotional style evidence. I think if I could have

done something different, I would have tried to find more concrete evidence on education and

how it statistically will benefit and inform consumers. That whole paragraph is based on my own

logic and reasoning and I think it would increase persuasion if I had more concrete ideas from

other sources.

ORGANIZATION AND REVISION: (A)

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I think organization/ revision is where I excelled. I think my overall outline of how the

paper/ argument is layed out is very effective and easy to follow. I made sure to tie my topic

sentences back into my thesis, to create a more clear idea of what each paragraph was going to

address within my argument. I think I did well outlining my paper before I began writing and it

definitely benefited my process of writing. If I could change something, I think I would have

revised grammar and syntax just a little bit more.

STYLE, EDITING, AND APPEARANCE: A

I think I had very clear and succinct points and writing in my argument. I wanted to be

clear but also follow a sort of style that was not just so black and white. I started by writing very

clear and succinct sentences and then following up by adding more style to them once the points

were made and established in the outline. I think I did the MLA citations correctly and have

alphabetized works cited. I think if I could have done something differently, I would have gone

back one more time (maybe have one of my peers read my final paper) and determine if I am not

being clear enough (if my “style” has turned into run on thoughts).