‘Greenhushing’ and why is it a risk for sustainability professionals?

‘Greenhushing’ and why is it a risk for sustainability professionals?

One in every five cases of corporate risk incidents linked to environmental, social and governance ESG issues stems from greenwashing.

It is an issue that every sustainability practitioner has had to grapple with and, as frameworks, the number of corporates called out for false green claims may well grow.

To avoid greenwashing accusations, some brands and businesses may feel compelled not to communicate as much about their environmental plans, instead sitting quietly on the information they have – or do not have – and going about progressing towards targets in silence.

This practice is known as ‘greenhushing’.

Greenhushing, has gained traction, since.

Reasons for doing so will vary; businesses may wish to avoid boycotts, increased staff turnover and reputational risk.

But, as sustainability becomes more mainstream, the reasons behind greenhushing are changing. New research suggests that greenhushing can now be linked to businesses that are trying to falsely appear more sustainable but are unable or unwilling to share the data and proof to fully back these claims.

While there are two sides to this greenhushing coin, the risks that corporates face for partaking in the activity – consciously or otherwise – remain consistent.

A recent survey of UK adults want to see more transparency from businesses on their environmental impacts, initiatives and targets.

As such, greenhushing may be causing more harm than corporates realise.

Corporates can list many reasons to ‘greenhush’ and not all of them are based on malicious intent to actively withhold information that could be perceived as damaging.

Indeed, some British firms are likely being held back by the policy landscape.

Four in ten of the UK-based professionals surveyed said Government policy was the most important driver for setting and delivering a net-zero target, compared with three in ten globally.

BAT does not hide from the fact that it operates within a controversial sector and is also not hiding behind that bold plan to reach net-zero emissions. Indeed, Butt believes that businesses will soon have “nowhere to hide” when it comes to communicating sustainability targets and the steps to reach them.

This will increasingly mean organisations have to communicate externally – often with external assurance – on key sustainability matters and metrics applicable to their activities such as GHG emissions.

In the UK, certain businesses are now mandated to report in alignment with the Task Force on Climate-related Financial Disclosures TCFD requirements.

The aim of the mandate is to increase climate-related engagement between investors and the companies they invest in. Until now, non-unified climate disclosures have made it challenging for investors to truly measure their exposure to climate risk.

Another benefit is that, in measuring their climate impact, risks and opportunities, businesses may well be compelled to increase their environmental ambitions and accelerate actions.

For businesses, this may come with operational cost savings and cost savings in terms of avoided risks.

More recently, the European Union’s Corporate Sustainability Reporting Directive CSRD floated the idea of “double materiality”, whereby organisations not only report the material impacts they have on environment and society, but also the material impacts of sustainability and accompanying requirements and regulations on that organisation.

Then there are the draft proposals from the US Securities and Exchange Commission SEC, and the UK Transition Plan Taskforce that, in the words of CDP, are “catalysing climate-related disclosures”.

In an era of heightened media coverage around sustainability and more green groups willing to call out cases of corporate greenwash; it can feel daunting to put a transition plan – essentially a company’s new regime for the next few decades – out into the public domain.

But while some corporates are waiting for regulation to give them a nudge towards greater transparency, the finance sector is beginning to take note of the risks of green hushing, deliberate or otherwise.

One of the major reasons that corporates tend to stay quiet on progress is that they don’t feel they have the quality of data to back up claims, or even uncover action areas for decarbonisation.

Data quality is commonly cited by investors as a reason for a lack of trust in corporate green claims and it is understandable that smaller sustainability teams will have trouble collecting data, especially if it relates to sprawling supply chains and Scope emissions.

Many sustainability professionals work to the mantra of ‘not letting perfection be the enemy of progress’ and many large firms will at least have key data points on tier-one suppliers and operations.

It is equally argued that the data collection issue comes down to a lack of interest at the boardroom level, and that sustainability professionals can list the upcoming regulations and heightened risks of greenwashing and hushing to gain more buy-in for quality data collection.

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