Corporate consumers nonetheless fall for inexperienced advertising puff, research finds | USAEMALL.com

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So far, concerns about “greenwashing” have focused heavily on marketing aimed at retail consumers. After all, savvy corporate buyers can tell the difference between green fluff and properly certified sustainability claims, right? Think again . . . 

Greenwashing

Even companies are susceptible to shaky green marketing

One product has multiple certificates from globally recognised organisations, testifying to its sustainability credentials. The other has nothing but slick branding to back up its maker’s green claims.

Which would you rather buy?

For the people handling procurement at European companies, the answer is very often the second option — according to an interesting new study, scheduled for publication in an upcoming edition of the journal Nature Scientific Reports, that raises troubling questions about corporate susceptibility to greenwashing.

The experiment

Academics Owais Khan and Andreas Hinterhuber, at the Venice School of Management, carried out a survey with 465 purchasing managers at EU-based companies.

Half of the managers were shown a pitch for office paper with voluminous but unsubstantiated green marketing claims about recycled material and carbon neutrality, along with a large-font claim to be “100% Sustainable”.

The others were shown a pitch for a similar paper, with minimal marketing language but with badges from both the Forest Stewardship Council and the Sustainable Forestry Initiative, two prominent certification schemes for sustainable practices in the paper industry.

The group shown the first pitch said they would pay, on average, 15 per cent more for the paper than for a typical alternative, due to its enthusiastically presented but uncertified green claims. The group shown the certified product said they would pay only 12.9 per cent more.

In other words, corporate purchasing managers seem to give no more weight to independent sustainability certification than they do to slick marketing claims — if anything, slightly less.

There was a similar story in electronics: the first group was willing to pay 17 per cent more for a laptop bearing uncertified green claims; the second, only 15.6 per cent more for one with green certifications.

In protective gloves, the contest between the certified and uncertified products ended in a dead heat, with purchasing managers willing to pay a 15 per cent premium for each — even though the certified product carried no fewer than seven different green stamps of approval.

The takeaways

What lessons can be taken from this? Corporate efforts to improve environmental standards do appear to be having a significant impact on the behaviour of purchasing managers, who are apparently willing to pay premiums exceeding 10 per cent for green products. The trouble is that these managers appear ill-equipped to identify which so-called green products stand up to scrutiny.

Part of the problem is a proliferation of green labelling schemes — more than 400, according to the study authors — and the lack of standardisation between them. A consolidation of many of those schemes might well be worthwhile.

Regulation may also have a big role to play. The EU’s Green Claims Directive has been in the works since 2023, prompted by concerns that more than half of green marketing is potentially misleading. The new rules would require companies making green claims to back them up with solid evidence, and to have them independently verified. But the directive is still under negotiation, and would still need to be transposed into national law once agreed. In most of the rest of the world, governments have been even slower to crack down on this issue.

For now, vague green marketing claims are set to remain a feature of the procurement landscape. That means companies need to build clear policies on what kind of product certification they value, and to train their purchasing managers accordingly.

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