Greenwashing
April 25th, 2008 | by Smithers |I took the opportunity to interview an employee of a major multinational corporation.
Q: Can you explain the term "Greenwashing?"
A: Look at some products on the market today, products that you might find in your refrigerator. On the packaging it says "This product is made from renewable energy" or "100% wind source energy used" or however they choose to phrase it. Well, my question would be, do they own their own wind farm. Most likely not. They are paying a premium charge for their energy, but not a huge charge in the scheme of things - maybe a couple of hundred thousand dollars extra, to buy wind source energy. Is that energy actually going to their manufacturing facility? No. They are just paying that premium to the utility company in order to state that they are powered by wind energy. The fact that they made that payment is what allows them to make the statement that they are a "green" company. But look at the process that is actually used to make their product. In the case of soy milk, the product is grown in a field which is very energy intensive when you take into account all the farming practices that are used to grow the product. The product is then packaged in a carton that is coated with some kind of plastic material that it not going to allow it to biodegrade or be easily recycled so it ends up in a landfill.
A lot of companies are taking advantage of this easy option in order to make the claim that they are "green" and they are using this claim, in a number of cases, to obscure the fact that they may not be especially "green" or, in some cases, that they may actually be making some pretty toxic products. Right now it’s all about winning the game of consumer perception.
Q: So you think there has been a conscious decision on the part of business to not actually incorporate "green" technology in manufacturing but instead using the "green" phenomenon as a marketing tool to promote their brand, or to actually hide some of the more harmful effects of their products?
A: That’s a generalization, but it is a fine line that companies walk when they go down the "green" road. Promoting the fact that a company may be "green" leaves that company open to closer examination as to whether or not they are indeed practicing sustainable energy management. Hopefully the consumer is getting smart enough to see this and ask these questions.
This issue is important to consumers and companies are struggling with how to deal with the question of sustainable energy as well as the consumer perception of the companies business practices. Look at Walmart. They have done a lot of work of the past few years to turn around the image of their company by embracing sustainable energy management. Walmart has also been putting tremendous pressure on their suppliers to meet minimum sustainability standards. They would not be making these moves if there was not a benefit in the marketplace, both in the cost of doing business but also in consumer perception, to do so.
There are a lot of companies that may be making a mistake by promoting themselves as "green" without actually doing any real significant work to practice sustainable energy management.
Q: Do you for see a social or political backlash against this "green" movement if the consumers see it as nothing more than a marketing gimmick?
A: It’s already happening. Consumers are already getting saturated with information on how live a "green" lifestyle. Paper or plastic, compact florescent bulbs, recycling, etc. It’s a bit too much right now because there is so much conflicting and inaccurate information out there that consumers don’t know what to do and aren’t sure that what they are doing is making any significant difference.
The average consumer is going to attach themselves to whatever was the latest sound bite they heard on the Today Show. It’s 90% emotion and 10% science. A lot of what I hear about renewable energy is cultivated by a fear of the unknown versus any real scientific study and until we really understand the real impact to the environment it’s just going to be chaos, as we are seeing now.
Q: What is the best way for consumers to learn about and understand these issues?
A: Fist off, as with anything, you should have a good dose of skepticism about anything you hear in the media, from government or from private agencies. When it comes to the "green" movement, regardless where you stand on the issue of global climate change, the biggest issue that consumers should take seriously is one of conservation. Stop chasing after questionable technologies that will "save the world". The biggest difference that the consumer can make right now is to just stop consuming so much. Stop using so much energy. Turn the lights off when you leave the room, burn less gasoline, turn off the water when you are not using it. It’s the pretty simple stuff that can make a huge difference when everyone does it, it doesn’t cost you any money (just the opposite) and it does not require some massive investment in the latest and greatest technology.
This is not to say that there will not be real technological breakthrough in the future. But we have been burned as a society time and time again by following these business trends. The dot com era of the late 1990’s, the mortgage and real estate crisis going on right now. There is going to be so much speculation in the "green" market in the future that it is inevitably going to blow up in our face. Consumers should really just focus on things that can be done simply and at home.
Q: Your advice to people who want to save the environment?
A: Look at simple ways that you can have less impact on the world that you live in. It’s really not that hard.



10 Responses to “Greenwashing”
By andrew at 9:36 am on Apr 25, 2008 | Reply
when general electric claims it’s green then i get skeptical
By Family Ties at 1:19 pm on Apr 25, 2008 | Reply
good advice - start where you are. you might try going slower on the freeway to consume less gas too.
By Steve E at 1:19 pm on Apr 25, 2008 | Reply
So what about buying that bigger home?
Presumably you saw the announcement this week about the MN lense company buying wind power for their plant. Seems to me this DOES cause utilities to invest more in this technology.
By jim r at 2:27 pm on Apr 25, 2008 | Reply
Maybe we can get the governor to actually come out against the huge proposed coal burning power plant in South Dakota instead of dodging the issue every time he is asked about it.
By Mrs. Smithers at 3:04 pm on Apr 25, 2008 | Reply
Presumably you saw the announcement this week about the MN lense company buying wind power for their plant. Seems to me this DOES cause utilities to invest more in this technology
The new MN renewable standards require that by 2020 power companies, such as Xcel Energy, show 30% of their retail sales are from renewable sources. Realistically that will be 25% wind + 5% hydro/biomass. Currently Xcel energy has a 4% wind make-up and it’s all purchased. They do not own their own wind generation.
How will they get to 25% wind? We will all pay for it. We are are paying for it now. Ever pay attention to those “other” fees or environment improvement riders on your electric bill? Businesses and individual will see an increase in these fees in the coming years to pay for wind. If you want to make an extra donation to Xcel now to say you are wind sourced, be my guest.
By yea right at 9:34 pm on Apr 25, 2008 | Reply
Hmm..it’s always interesting to me to see how many people have become energy experts now that everyone’s convinced of global warming. Any company investing in asset accumulation is going to require capital expenditure funding, and that equates to higher consumer costs; regardless of the portfolio mix. Just like the highway infrastructure in this country has eroded over time due to entropy, so too have our energy facilities. Whether it’s wind, solar, or coal, stuff’s gotta be replaced and soon. Unfortunately, most renewable is base load, wind runs at night, and it can’t be stored. THIS is the real problem with wind and many renewables, not the fact that there’s a requirement to blend it into the mix.
Oh, and as an energy professional, I choose to buy from the soy company (silk) that does purchase energy recs. Why? Because even being skeptical I understand that those dollars put more green infrastructure into the system. And I also conserve. What’s wrong with doing both?
By George at 2:34 pm on Apr 26, 2008 | Reply
“A lot of companies are taking advantage of this easy option in order to make the claim that they are “green” and they are using this claim, in a number of cases, to obscure the fact that they may not be especially “green” or, in some cases, that they may actually be making some pretty toxic products.”
I hate seeing companies trying to bend the rules when it comes to energy management. Larger companies as a whole seem to be the main problem right now. They need to know that there are companies out there like Enernoc (http://www.enernoc.com/) who are even willing to pay these large companies to make the switch to greener methods.
By Roger Carthew at 1:51 am on Apr 27, 2008 | Reply
The ultimate question is, “has the company embarked on a program to improve/reduce its environmental impacts.” If so then they should be given credit for this. Also in a market economy it is completely illogical for a business to pay exctra for its electricity or what ever without have an eco-efficiency program in parallel. This way they can make the grand statements, perhaps even have lower expenditure because of efficiency gains and then still get the beenefit of the statement.
Transparency on the part of the business will allow us to really view the results and then we can judge if its greenwashing or genuine environmental improvement!