The Green Rush

This is excerpted from an article from one of my favorite sites, brandchannel. It addresses the topic of greenwashing, which is when a company claims to be green though it really isn’t.

It’s a complex issue. Pacific Gas & Electric is the largest energy company in the world, operating nuclear and coal-fired plants throughout the western United States. Both of these sources create huge environmental problems, and PG&E; is considered by many to be a dangerous, irresponsible corporation.

On the other hand, PG&E; is also the largest energy conservation organization in the world. The company has made an increasing effort over almost 20 years to change how people use energy, from subsidizing energy efficient lightbulbs to hauling away old refrigerators and paying the homeowner $35.

So, while PG&E; could not rightly call itself a ‘green energy company,’ it would be fair to claim a leading role in energy conservation and efficiency. Nobody’s perfect, but PG&E; (and the rest of us) should continue to make changes that will benefit the environment. What I found most interesting about Dr. Brady’s article is his idea that greenwashing will come back to bite the perpetrators.

Moral of this story: painting yourself green doesn’t wash.

The Greenrush: Eco-branding
by Dr. Arlo Brady
August 27, 2007 issue

Thanks to, among many other things, the activities of prominent individuals like Al Gore and Robert Redford in the US, and Ken Livingstone and Prince Charles in the UK, awareness of key environmental challenges has now reached an all-time high. The recent July 7th Live Earth concerts, and the release of Leonardo DiCaprio’s latest film, The 11th Hour, indicate that this trend is unlikely to subside for some time.

The continued growth of eco-brands is to be expected, but perhaps what is more interesting and less predictable is the attempt, frenzied at times, by many large businesses to emulate this success by integrating environmental messaging into their core brand proposition.

To the external observer this phenomenon has much in common with the early 19th century gold rushes in California. As with the gold rushes, the 21st century greenrush has experienced its early successes and failures. Prominent examples experiencing initial success include: Wal-Mart (Sustainability 360), BSkyB (CarbonNeutral), GE (Ecomagination), Marks and Spencer (Plan A), and Toyota (Hybrid Synergy Drive).

These kinds of behaviors directly and indirectly result in several different outcomes: Firstly, in an era of transparency and globalization, they commit the organization to making concrete changes regarding the way it operates. Secondly (and of far more interest to savvy business leaders and politicians), it keys them into the zeitgeist of a generation, developing a sense of organizational relevance, prestige, and modernity.

This second observation provides some insight into why many organizations are desperate to be seen as being “green.” It’s not a fear of environmental risk and exposure; it’s knowledge of the scale of the impending corporate social opportunity (CSO).

The far ranging reach of the current greenrush has meant that globally, individuals are now coming into contact with green political and green business brands and messaging on a regular basis. This increasing familiarity and exposure to background noise has resulted in a growing climate of suspicion. Stakeholders are asking themselves whether the green efforts that they are hearing about are sincere. Many now believe that politicians and business leaders are just developing clever marketing/branding campaigns designed solely to increase sales or votes.

They are of course broadly right; most of the businesses and politicians who are tuning their brands to incorporate environmental messaging are absolutely doing so in order to enhance sales and/or votes. But there is nothing wrong with this enlightened self-interest, provided of course that the green marketing meets reality, and that genuine changes have been made.

This is not always the case, and there are a fair number of what economists call freeriders and environmentalists call greenwashers—people attempting to unjustifiably extract value from the greenrush. This is an increasingly risky position, and will soon become untenable as public interest in, and knowledge about, issues like climate change grows.

The confusion that currently surrounds the greenrush is temporary. In the near future a pale blue/green brand will not be an adequate defense against greenwashing claims.

Of course, that is not to say that organizations should not integrate green messaging (or even the color itself!) into their brand. Quite to the contrary, go ahead, but only if the organization concerned is aware that it is committing itself to a path for the long-term. It will have to walk the talk.

Dr. Arlo Brady is special advisor at strategic marketing and communications firm Freud Communications. He is also an associate at the Judge Business School, Cambridge University. For further information see his website, or his blog.