Over 112 million people tuned in on Super Bowl Sunday to watch the NFL championship game, many of them also (or even exclusively) to watch the commercials that aired throughout the night. Even the casual viewer likely noticed almost ten different commercials that centered on themes of sustainability, zero waste, carbon offset, and climate change. Yet, critics were quick to argue that the commercials were greenwashing consumers, marking perhaps the first year that Super Bowl ads and greenwashing became a topic of morning water cooler conversation. For corporations, though, the point underlies the reality that in today’s market, any and all statements that are put forth touching on environmental issues run the risk of accusations and lawsuits alleging greenwashing. Now more than ever, globally situated companies of all types that are advertising, marketing, drafting ESG statements, or disclosing information, as required by regulatory agencies, must pay extremely close attention to the language used in all of these documents and media, or else run the risk of enforcement action or lawsuits.
Super Bowl Ads and Greenwashing
Some of the more prominent commercials during the Super Bowl that featured environmentally-friendly themes came from the automobile industry. Several commercials touted new lines of 100% electric vehicles, with obvious themes centered on reducing carbon emissions and helping to combat global warming. One commercial went so far as to even directly state “no greenwashing!” in the commercial. Not to be left out, Salesforce and the food industry also aired commercials with environmental and sustainability undertones. Critics of the transparency of the messaging in these commercials, though, quickly argued that the commercials merely provided green-friendly messaging to consumers who may only be familiar with the more heavily-reported environmental issues.
Taking the automobile industry as an example, there were more electric vehicle commercials than ever during the 2022 Super Bowl. All of them displayed new lines of 100% electric vehicles, with varying themes of their impact on reducing carbon emissions. Electric vehicles are almost universally powered by lithium-ion batteries. It is that fact that greenwashing accusers say that average consumers are not told because the batteries themselves present environmental issues of potentially equal or greater concern than gasoline-powered vehicles. The issues start with the mining of lithium and the manufacture of lithium-ion uses enormous amounts of water, and the technology used to extract and transform the raw material into a usable resource also creates carbon emissions. Further, while many companies are investing millions of dollars into reuse and recycling options for lithium-ion batteries, there is growing concern regarding the practice of disposing of the batteries into landfills, which may therefore present land contamination concerns. Finally, critics point to the necessity of manufacturing, transporting, and installing recharging stations throughout the country in order to make the mass use of electric vehicles a reality as processes that will generate waste, air pollution and carbon emissions.
Critics therefore claim that while the outward messaging from car companies is one of sustainability and clean energy, pulling the curtain back on the electric vehicle industry will reveal a different story.
Corporate Preparation Is Key
In less than two months in 2022, the fashion industry, the cosmetics industry, and the restaurant industry have seen litigation and regulatory agency activity increase with respect to greenwashing concerns. We predict that 2022 will see a great degree of regulatory enforcement action and legislation seeking to curb overzealous marketing language or statements that could be seen as greenwashing.
While there are numerous avenues to examine to ensure that ESG principles are being upheld and accurately conveyed to the public, the underlying compliance program for minimizing greenwashing allegation risks is absolutely critical for all players putting forth ESG-related statements. These compliance checks should not merely be one-time pre-issuance programs; rather, they should be ongoing and constant to ensure that with ever-evolving corporate practices, a focused interest by the regulatory agencies on ESG, and increasing attention by the legal world on greenwashing claims, all statement put forth are truly “ESG friendly” and not misleading in any way.
Article By John Gardella of CMBG3 Law
For more articles on greenwashing, visit the NLR Environmental, Energy & Resources section.
