Why A Green Watchdog Is Needed To Address Deceptive Greenwashing

Addressing climate change is one of the biggest priorities for business and Government leaders over the next decade. In this decade, the global economy will need to half its emissions whilst continuing to increase economic prosperity.

There has been a cambrian explosion of green announcements about the measures that Governments, businesses and NGOs are taking, and the promises of new decarbonizing technologies.

However, a close examination reveals most of these announcements are largely led by marketing departments to exaggerate green credentials rather than significantly reduce the environmental footprints of the products they are producing.

This is known as Greenwashing, and has been used by companies to seek additional investors, customers or seek to influence Government policies to favor their businesses.

The effects of greenwashing has been seen with several Central Banks now warning of an ESG bubble. ESG (Environmental, Social and Governance) indicators have seen a 30% year on year growth, and could be as high as $53 trillion by 2025 or one third of all assets under management according to Bloomberg.

It has been touted by many of the lead indices (e.g., Reuters, Bloomberg, S&P) as a sign that investors are seeking more responsible investments.

However, for those involved in compiling and analyzing ESG indicators, there were deep flaws in how the data was compiled and presented.

Incomplete data was presented that gave a misleading impression that companies were greener than their operations would indicate.

For example, there are companies going around pushing an incorrect and damaging narrative that the only way to meet battery minerals demand for electric vehicles is to mine the seabed floor.

These are companies that have attracted large institutional investors, SPACs and a listing on NASDAQ without a serious response being offered to questions by credible scientists.

Similar claims by global shipping, global fishing, lumber sources, food sources are raising more questions.

Some have argued that the harm is cosmetic, and it is more important to get companies discussing sustainability than ignoring it. However, the harm that Greenwashing does is to mislead the public and undermine trust in a system that is supposed to protect the most vulnerable in society who are most dependent on a healthy planet.

It is clear that business self regulation is not a cure.

This is a role that Governments should look into.

A new Global Green Watchdog should be created. This could put science at the heart of the watchdog and a team of analysts who can assess the quality of information being revealed.

This would need to be a team of analysts who are also aware of what additional technologies are available to triangulate data.

Even if a company claims that it is not collecting this data, another question is whether this omission is by choice. We have seen large technology companies using this excuse by way of dragging their feet to taking action to remove controversial content from their platforms.

Exponential technologies using the power of satellites, artificial intelligence, blockchain and synthetic biology are able to offer much deeper insight than data being held within a company.

If companies are strategically underinvesting in ways to accurately validate the sustainability claims they are making, then Governments have an important role to play.

A new form of Exponential Watchdog - publicly funded - with real teeth and enforcement, similar to that of a Central Bank’s Inspection Unit, would be needed to hold environmental data reporting and marketing claims to account.

It would also help the world to produce a League Table of sustainability to assess which organizations are truly sustainable and which ones are just claiming to be.

This is a battle for the future of our planet, and we need the best resources possible, not just the ones who can get a marketing message out early and loudly.