Why more companies are deliberately ‘greenhushing’…
A new phenomenon called ‘greenhushing’ is setting in, caused by companies needing to be ever more careful when making promises, especially about improving the environment.
A global industry is developing to check that words lead to actions. They are on the lookout for exaggerated ambitions and especially “greenwashing”.
For instance, Coca-Cola came under intense criticism for sponsoring last autumn’s COP 27 climate change conference in Egypt, as did the organisers for accepting the funding from the soft drinks giant that has been dubbed “the world’s top plastic polluter”,
Coke, it was alleged, was using the event to promote its environmental credentials far beyond its actual achievements.
Five years earlier, however, Coke committed to a significant environmental effort. It is dedicated to recapturing every bottle it sells by 2030 so that none of them ends up as litter or in the oceans.
It also committed to a global target of having 50% of its bottles made from recycled material. The aim is then to recycle each bottle’s plastic into new bottles.
Those ambitions will be measurable in the years running up to 2030 and undoubtedly environmentalists will be doing just that.
But those same environmentalists are especially on the lookout for contradictions for which they can bring companies to book.
Last year, for instance, Britain’s Advertising Standards Authority rapped the Coca-Cola-owned soft drinks group Innocent for misleading consumers with an ad featuring characters singing about “fixing up” the world.
The ASA ruled that the ad implied a “positive environmental impact” from purchasing Innocent‘s products, pointing out that that is ”not the case” because its products come in single-use plastic bottles.
But in tune with public opinion, all the global drinks groups are making commitments to reduce their environmental impact.
Diageo says that “by 2030, every drink we make will use 30% less water than today and by 2026 we will replenish more water than we use in all our water stressed areas”.
The world’s biggest luxury goods group LVMH has set out a “water conservation plan on a global scale” that will reduce its water consumption worldwide by 30% by 2030.
Like Diageo, Pernod Ricard has a “grain to glass” policy. CEO Alexandre Ricard says: “We strive to be environmentally sustainable at every step of our production, from grain to glass, by working with our employees, partners and local communities to ensure natural ecosystems and resources are protected and preserved.”
And apart from being kept up to the mark by environmental pressure groups, both he and LVMH chairman Bernard Arnault know the French authorities will be watching them.
France has passed a law to ban companies from greenwashing the public. To legitimately claim carbon neutrality, no greenhouse emissions must be generated in the production, manufacture or recharging of a product.
In the US, Brown-Forman says its goal is to halve its emissions by 2030 and have net zero greenhouse gas emissions by 2045. It is also committed to having 100% water balance by 2030.
Down Under, Treasury Wine Estates has much the same ambitions.
Yet even when companies are certain they are fulfilling their promises they now need to beware of trumpeting their successes too loudly, especially in America, the world’s largest market for premium drinks.
What is greenhushing?
A new phenomenon is evolving, that of “Greenhushing”.
This is a practice in which companies keep their environmental goals under wraps for fear of a public backlash as corporate America becomes more deeply embroiled in a war over climate change.
Liberal activists have sued corporations for not doing enough to combat global warming while conservatives have boycotted firms for even acknowledging that they should factor climate change into their business plans.
A survey by climate advisory consultancy South Pole found that of 1,200 large US private companies that have set climate targets, yet a quarter do not publicise them.
“If you’re a CEO who has all the right intentions, you might get sued from both sides — from the left and from the right,” South Pole’s head Renat Heuberger told the Washington Post.
The paper claimed that a survey of its ads revealed that Anheuser-Busch InBev has stopped running Facebook advertisements about achieving net-zero emissions by 2040 and 100% recycled packaging by 2025.
In response, AB InBev said it remains committed to combating climate change and to publicising its efforts.
But it is not only environmental policies that the critics are scrutinising. Political actions are also coming under the microscope. For instance, Bacardi is facing a potential backlash over continuing to trade in Russia following the invasion of Ukraine.
The Business and Human Rights Resource Centre has accused the Bermuda-based company of switching position.
Bacardi said initially that it would cease exporting to Russia and freeze investments and promotions of its products there.
“However, the pledge to halt supplies disappeared from the press release [on the website] soon after and, over the past year the profits enjoyed by Bacardi’s Russian outfit have tripled,” BHRRC claims.
It also says Bacardi has not responded to its allegations. The drinks business has also not received a reply from Bacardi.
Not only are international bodies monitoring company actions, but they are also becoming subject to formal academic study, which could become widespread.
Yale professor Jeff Sonnenfeld has told CNN that he was also monitoring up to 1,000 companies who could be breaking promises about trading with Russia.
Sonnenfeld has marked down Heineken for “dragging its feet” over the sale of its Russian operations following an announcement in March that the Dutch group was about to conclude a deal.
At the time Heineken said it was committed to exiting Russia and that it expected to lose about €300 million through the sale.
Heineken has not responded to db’s request for a comment on Sonnenfeld’s allegation.