How to Avoid Greenwashing as a Sustainable Entrepreneur

As an entrepreneur, you need to be careful and avoid greenwashing, if you don’t want customers to avoid your brand

The last three years have been a rollercoaster for businesses, entrepreneurs, and consumers all over the world. First, the coronavirus pandemic shook the world and economic activity to its core and now the war in Ukraine is creating a global food crisis.
As if environmental, social, and economic issues, weren’t enough, the recent health and food price crises add more to the burden of unsustainable production and consumption.

But the world has pledged to fix itself by 2030. As the countdown towards 2030 is running the frequency and intensity of the climate crisis, and natural disasters have increased dramatically. Even though the world is looking like the set of a disaster movie, there’s room for a bit of optimism.
It comes from local communities, grassroots groups, and social entrepreneurs. The latter not only benefit their communities and the environment but also create profitable companies and organizations. As experience has shown the higher the positive progress a company brings, the easier is to make the voice of the people it represents heard. At the same time, sustainable businesses receive more support from customers. So what is a trend in sustainable entrepreneurship you should watch for in 2022?

Being careful with green and purpose-washing

“Greenwashing is the process of conveying a false impression or providing misleading information about how a company's products are more environmentally sound. Greenwashing is considered an unsubstantiated claim to deceive consumers into believing that a company's products are environmentally friendly,” definition by Investopedia

While being highly important to consumers, terms such as green, eco-friendly, sustainable, plant-based, and net-zero are at the same time the most overused and misused terms by companies that promised but couldn’t meet their commitments. Consumers are now more than ever interested in the environmental impact of the products and services that they buy. They’re searching for the best alternatives and at the same time, they are getting more self-educated.
Therefore, existing and newly established companies and startups are innovating to capitalize on this growing demand, but here they face the first obstacle. The green consumer dilemma.
People are ready to support sustainable companies, but at the same time, they have little faith that those brands will commit 100 percent to their purpose.
But how can a newly established startup know for sure that it is going to deliver on its promises? Greenwashing can be both deliberate and unintentional. That’s the reason why many companies decide not to share a lot of their commitments at the beginning. They don’t want to fail their staff, clients, customers, investors, and other stakeholders.

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What to do? You want to differentiate your product/service from the others. Sometimes, certificates only are not enough. You need to tell a story. Share an authentic and complete story. Don’t try to get credit for more than what you are doing. Do not exaggerate on eco-friendly and sustainability credentials. An educated customer will easily spot a false claim. Meanwhile, an uneducated customer will end up believing false information as fact.
Educate your customers on what you are doing. Many people are suspicious of a brand's sustainability claims because they don’t know how to tell the difference. When you explain to your customers what you are doing and why and the novelty behind the product, they will be able to tell the difference. You can also read about the seven sins of greenwashing.

Are you new to the concept of sustainable entrepreneurship and want to learn more, gain new skills and build the right mindset? We suggest you join the Citizen Entrepreneurship Competition. The contest gives you the opportunity to learn how to develop a starting idea into a real product or service, how to promote it, and to test yourself as an entrepreneur.
Do you want to challenge yourself for a good purpose? Submit your idea or project before September 15th.