Greenwashing

Impact of Greenwashing on Consumers Name: Institutional affiliation: Course: Date: Introduction In the era of corporate social responsibility (CSR), many organizations realize the need to operate beyond profitability. De Jong et al., (2018) argue that the focus among most contemporary organizations today now revolves around people, the planet, and profitability (De Jong et al., 2018). The focus on people, planet, and profit is attributed to growing expectations for businesses to make a positive impact on their communities while maintaining negative impacts at a minimal or zero level (De Jong et al., 2018). Caroll (1991) agrees by stating that, businesses existing today have four responsibilities namely: economic responsibility, ethical responsibility, legal responsibility, and philanthropic responsibility. Each of the four responsibilities is vital and must be balanced to ensure continuity and success in the competitive landscape. Research postulates that a strong emphasis on CSR portfolios benefits an organization, whereas neglecting CSR portfolios negatively impacts an organization (Useche et al., 2023). With “going green” being a major benefit to organizations, it is evident that greenwashing has emerged as a trending CSR twin in today’s business world. Greenwashing, which refers to the deceptive marketing practice of misleading consumers regarding environmentally friendly products or false representation of a product as environmentally beneficial, is now a critical issue facing consumers who are increasingly seeking sustainable and ethical choices. Greenwashing activities exploit consumers' genuine pursuits for a green environment triggering other problems such as twisted consumer choices, disillusionment, and distorted understanding of sustainability. Impacts of Greenwashing on Consumers Greenwashing Misleads Consumers Daphne (2023) reports that greenwashing is so rampant today to an extent that 4 out of 10 consumers are victims. She reports that out of 1095 randomly selected websites, 50% had insufficient information which made it hard for consumers to correctly judge the accuracy of their greenwashing claims, 37% had vague statements strategically designed to give consumers an unsubstantiated impression that the advertised product had no negative environmental consequences, and the remainder had no support to back their sustainability claims or designs. The fact that large corporations, that committed to commit to environmental protection, are part of the greenwashing exercise makes the entire market dysfunctional with the majority of consumers often suffering the consequences of this unhealthy exercise. In a research by Krafft & Saito (2015) greenwashing mislead consumers significantly, often influencing them to make false environmental choices, encounter financial losses, and encounter direct and indirect harm to their health and safety. The truth about today’s consumers is that 60% of consumers rarely can identify greenwashed ads or claims as misleading. According to Krafft & Saito (2015), a significant percentage of consumers consider a brand to be environmentally friendly if exposed to a greenwashed advertisement than to an environmentally neutral advertisement. The limited restrictions on how companies can use greenwashed ads mean that consumers face the risk of being misled every time they are faced with a purchase decision. The misleading green labels and symbols often trigger a significant number of consumers to purchase a product because they believe their purchase will indirectly contr...