ESG: THE OPPOSITE OF GREENWASHING
Companies and organisations are increasingly under pressure to improve their ESG disclosure and the perceived “eco-friendliness” of their products and services.
However, there is also the potential for “greenwashing” if companies and organisations overreach. That can put the efficacy of ESG practices and investment at risk.
The term “greenwashing” was coined by environmentalist Jay Westerveld in 1986. He criticized the way hotels framed the “save the towel” initiative in purely environmental terms when, in fact, it was actually a financial strategy to reduce operating costs.
Since 1986 the concept of greenwashing has become more pronounced, to the extent that regulators are developing rules and provisions to prevent and punish greenwashing. Despite the accelerated use and sophistication of greenwashing, there is no universal definition.