If the UAE is serious about sustainability businesses need to stop greenwashing

Executives can no longer afford to approach sustainability as an afterthought or a ‘nice to have’. Organisations embracing authentic sustainability will drive green growth, engender enthusiasm from their key stakeholders and broader community, and drive innovation. Inevitably, this means saying goodbye to greenwashing.

The great greenwashing gimmick

If you have ever picked up an item because it had the word ‘natural’ or ‘eco-friendly’ on it, you may have been a victim of greenwashing. Greenwashing is the practice of making brands or products appear more sustainable, or, less damaging than they actually are. It may involve cynical marketing ploys, misguided PR stunts, or simply changing the aesthetics or packaging of a product to mislead consumers into thinking a product is more sustainable.

Unfortunately, these practices have become commonplace in a world that recognises the urgency around climate action. Companies that ‘spray the green sheen’ across their products and services with complex data or claims that are intentionally difficult to substantiate demonstrate what not to do in a society that values honesty and purpose-driven organisations.

To help quantify and understand greenwashing, the Canadian environmental marketing agency, TerraChoice, developed a sequence of patterns to watch out for. ‘The Six Sins of Greenwashing’ can be summed up into organisational claims that have: no proof, vagueness, the hidden-trade off (such as McDonald’s switch to paper straws as a ‘greener’ alternative), irrelevance, fibbing, and lesser of two evils (touting one good sustainable aspect of the business while ignoring greater environmental harm). This is good guidance for businesses wanting to avoid making misleading environmental claims.

In 2021, brands such as H&M were under the watchful eye of climate activist groups and investigative journalists who said that 96 percent of their claims did not hold up. Similarly, household staple Windex was called out for making unsubstantiated claims regarding their bottles made from “100 percent ocean plastic”, which was never actually in the ocean to begin with.

For companies capitalising on conscious consumers, it may no longer be an option. Radical shifts can’t be accomplished overnight, but there are several strategies that can help businesses turn a profit whilst also contributing to better, more resilient business models.

Innovating sustainable business models

Often, sustainability is perceived as a high barrier, high-cost endeavour. This couldn’t be further from the truth. More times than not, innovative business models are quite simple in their design but executed with precision. In times of economic downturn, businesses can contribute more broadly to society and the environment, and boost profits just by changing how they allow clients to access their products.

The Covid-19 pandemic demonstrated how fragile and inherently interconnected supply chains are. Businesses left with large stocks of surplus materials were left in financial distress due to demand bottlenecks, contributing to the existing $288 billion excess inventory market.

The sharing economy, or rental services, allows consumers to borrow items for a set period of time rather than purchasing them outright. This can be particularly appealing during times of recession, when ownership is a liability, and it’s more economical to rent. Aside from making better use of inventory, an alternative to purchasing can help attract new customers, as well as encourage loyalty amongst existing ones.

The sharing economy is available in almost every industry – from AirBnB for homeowners, WeWork for co-working spaces, the list goes on. There is no reason why organisations can’t benefit from the added value that it provides as a strong model of sustainability. Case studies such as Zipcar, a car sharing company that allows customers to rent cars hourly or daily showed a significant impact on GHG emissions – each Zipcar took an average of 15 personally-owned vehicles off the road.

In fact, the financial and environmental benefits are closely connected. From promoting resource efficiency, to improving cash flow and agility, contributing to the circular economy allows assets to be re-used and waste reduced. For example, redesigning products to meet environmental accreditations or building social capital can offer new business opportunities. American conglomerate 3M has a ‘Pollution Prevention Pays’ programme, which aims to reduce waste and avoid pollution through product reformulation, process modification and infrastructure upgrades. The firm’s Novec fire suppression fluids are the first viable, sustainable alternative to hydrofluorocarbons.

For UAE manufacturers who want to start small, this could mean considering collaborative manufacturing, where they can share facilities and equipment to increase resource efficiency and decrease overheads. For technology startups, it could mean using cloud computing services to reduce the need for individual servers and their associated energy consumption.

Similarly, for fleet owners, co-sharing logistics could reduce transportation emissions and costs. In short, there are ample opportunities to become heavyweight contenders for championing sustainability.

Sustainability is a science which requires substantiation

Businesses wouldn’t make ballpark estimates of their financial figures, so the same logic should apply for sustainability claims. However, last year, European research highlighted that over 42 percent of green claims were misleading, exaggerated, or false.

Thankfully, with the mounting pressures of transparency, supported by regional and local government this is likely to change and companies can take tangible steps to validate their assertions.

Many organisations know the importance of understanding their internal greenhouse gas inventory (GHG), measuring Scope 1, 2 and 3 emissions for a foundational understanding of how emission-intensive they are. Beyond this rather theoretical exercise, there are more action-oriented options that can assist in sourcing empirical evidence to back up their claims, deepening their engagement and understanding.

For consumer-facing businesses, Life Cycle Assessment (LCA) can evaluate the environmental impact of a product, identifying areas for improvement. The LCA, while requiring technical knowledge, gives comprehensive oversights of a product’s lifecycle from raw material extraction to disposal, providing significant business intelligence.

Proctor & Gamble used this framework to respond to their customers’ pain point of high energy costs, conducting an LCA of its products. The research found that US households spend 3 percent of annual electricity budgets on heating water to wash clothes. As the opportunity unveiled, they launched a line of cold-water detergents that require 50 percent less energy than warm water washing.

Notably, accreditations offer a robust way to demonstrate commitment to transparency through a systematic auditing process. Environmental management systems, such as ISO 14001 can help companies manage their impact and improve performance. Further, the Science Based Targets Initiative (SBTi) is becoming an increasingly popular way to define and promote best practices in emission reductions and align net zero targets with climate science.

Ultimately, sustainability is the currency of the future. The potential for companies to embark on their sustainability journey can provide short-term gains, such as cost savings, plus more long-term commercial accomplishments such as enhanced reputation, tapping into new markets and innovation capacity.

In the quest to become a more conscious, purpose-driven organisation, it is important to remember that sustainability is, at its core, a social responsibility and an act of self-preservation, not an environmental one. It is about taking responsibility for the impact businesses have on society and future generations, as history has proved the ecological world will thrive through resilience, but the same cannot be said for humankind.