Businesses that are caught greenwashing could potentially experience irreversible reputational damage, financial loss, as well as lose consumer confidence, according to industry experts.

A recent Tourism Update poll revealed that the industry had noticed a rise in greenwashing – which refers to misleading or exaggerated environmental claims made by businesses to appear more environmentally friendly than they actually are. Such claims often deceive consumers who are eager to make environmentally responsible choices.

“Losing the trust of buyers and compromising consumer confidence by making misleading claims is exceptionally difficult to recover from. The ease with which negative experiences (including those of greenwashing) can be shared on digital media platforms means that greenwashing allegations can spread rapidly. Repercussions would most certainly include financial losses and possibly compromise B2B partnerships,” said Lisa Scriven, GM of Fair Trade Tourism (FTT).

Scriven told Tourism Update that the implications for greenwashing are becoming increasingly severe. “For example, with the Green Claims Directive in the EU, suppliers to these markets will need to make sure their claims are adequately substantiated and accurately communicated.”

On March 22, 2023 the European Commission unveiled its proposal for the Green Claims Directive. The directive's primary objective is to combat greenwashing by establishing clear guidelines for companies on promoting environmental claims to consumers.

The directive requires businesses to substantiate their environmental claims with a comprehensive assessment. This means that companies must provide credible evidence to support their assertions, ensuring that consumers are not misled.

How to avoid greenwashing

If a business is going to make claims about its sustainability performance, it must be able to back it up, said Scriven.

“The most robust and credible approach to avoid greenwashing is through independent assessment or verification by an entity with relevant expertise and a qualified team.”

Conservation-driven safari company Natural Selection advised companies to keep the philanthropy decisions separate from the business in order to avoid any grey areas. 

“Our marketing focus at Natural Selection is on our conservation and community impact and very little on our camp sustainability initiatives (which is where most companies’s greenwashing occurs). We believe that sustainability at camps should be a given and not something to shout from the roof top.  

“Camp sustainability is of course important to us, and we are committed to continued improvements and alignment with the ever evolving sustainability technologies and practices so that sustainability considerations are core to our ethos,” said Dr Jennifer Lalley, one of the Founders of Natural Selection and Natural Selection Conservation Trust Trustee and Chair; and Murray McCallum, Sustainability and CSR Manager, and Natural Selection Conservation Trust Administrator.

Natural Selection’s commitment to conservation and communities is built into its business model.

“No matter the circumstances, economic or other, we give 1.5% of overall revenue to our non-profit organisation that is run by an independent board comprised of conservation scientists. This board ensures that this funding is spent in an impactful and meaningful way for conservation and it keeps tabs on outcomes,” Lalley and McCallum said.

First action. Then communicate green initiatives

Scriven noted: “First take action and then figure out how to effectively communicate this to the market.”

She further advised businesses to avoid sustainability jargon.

“People are sceptical of the nebulous terms of ‘eco’, ‘sustainable’, ‘green’, etc. Rather tell them what impacts a business' actions have and, importantly, how these improve the guest experience,” she said.

An in-depth exploration of this topic is also provided in FTT's marketing and communications toolkit, which is based on the ‘Keep it Real’ approach of Professor Xavier Font.

“We turn our ‘green’ words into action through our independent board members who ensure funding is directed to impactful programmes and through our outreach managers in the different areas of operation who have an ear to the ground on what’s needed,” the Natural Selection duo said. 

Lalley and McCallum added that Natural Selection measures the true impact of its sustainable initiatives through regular reporting from funded projects and on-the-ground visits.

“We think it’s important for companies and consumers to differentiate between things that are just a cost of doing business and real conservation and outreach work that is additional to what their business operation would do anyway in order to operate. This applies to camp sustainability measures as well,” the pair concluded.