While editing an environmental, social and governance (ESG) report for a US corporation recently, I noticed someone had cut the paragraph I’d written on how its carbon footprint was calculated.
“I don’t think we want to say all this,” one of the senior executives had commented in the margin. “Our peers don’t really explain their methodology. If we do, we could stand out for the wrong reasons.”
We talked it through over videocall the next day and in the end some of the text was restored – but not all of it.
Some might call this ‘greenhushing’ – the buzzword for when a company stays quiet on aspects of its sustainability efforts to avoid scrutiny. It sounds sinister but, as a copywriting agency that works in close partnership with companies on their ESG and climate risk reports, we know this silence reflects genuine anxiety among some senior leaders about damaging their brands.
Here’s why we believe greenhushing is an understandable corporate response in the current climate – but not ultimately the best way to safeguard reputation.
Reticence is understandable
Regulators around the world are increasingly clamping down on greenwashing, and we’re seeing the beginnings of what could be a wave of litigation against firms that make unsubstantiated claims about their progress to tackle climate change.
When news of these cases are amplified by kneejerk news stories and trial by social media, it’s no wonder some companies are clamming up about their environmental and social goals. A recent survey by climate consultancy South Pole of 1,200 large private firms with climate targets found that one in four did not plan to publicise them.
The proliferation of ESG reporting frameworks has not helped, although it is hoped that the standards now coming out of the recently formed International Sustainability Standards Board will finally succeed in setting a global baseline of consistent and comparable information. In the absence of this universal approach, companies have been forced to create their own metrics and definitions of success, which they then nervously compare to those of their peers.
An added complication is that a company’s greenhouse gas emissions, especially in its supply chain or the use phase of its products, often have to be estimated using proxy data, and different carbon accounting firms have different methodologies. This leaves companies fearful of being unfairly compared with their peers and worried about how to explain the nuances of their carbon footprints.
As one client put it to us recently: “Obviously we’d like to be seen as a sustainability leader. But with our disclosures, we want to be somewhere in the middle of the pack.”
Silence is not golden
Zipping lips is one way to protect an organisation from greenwashing accusations or political backlash, but it has its limitations.
More than three-quarters of institutional investors surveyed in EY’s latest Global Corporate Reporting and Institutional Investor Survey, complained that companies were creating a “trust deficit” by being “highly selective” in what ESG information they disclosed to investors. And the EY 2022 Global Climate Risk Barometer, an analysis of climate risk disclosures made by more than 1,500 companies worldwide, found that companies were “not providing meaningful commentary about the challenges they face”, with more than half of those surveyed either not conducting scenario analysis, or not disclosing the results.
In other words, it’s not just what companies say in their ESG and climate risk reports that is stoking investor scepticism but what they leave unsaid. “If we are to accelerate progress, we need companies to be more transparent about the process they’re following to achieve their emissions targets, the investments they’re making, and what they’re doing in the event they miss those targets,” the report concluded.
Clamming up on climate risk and decarbonisation efforts, has other disadvantages too. It limits knowledge-sharing, role-modelling and collaboration within industries, potentially leading to less ambitious targets and stuttering innovation. Ultimately, we believe this could erode the confidence of all stakeholders, not just investors. As regulators increasingly step in to mandate disclosures, businesses that have stayed quiet may find they have a bigger mountain to climb to prove they are capable of transitioning to a low-carbon economy.
“We cannot afford to lose time,” says Renat Heuberger, CEO of climate consultancy South Pole. “To move ahead, we need a future in which society has the ambition and ability – but also the confidence – to address climate change on the scale that is required. This is impossible if progress happens in silence.”
Perfect is the enemy of great
When companies come to us to partner on sustainability reports, we find the overwhelming majority want to accelerate positive change and recognise the vital role business plays.
During the interviewing phase, they tend to be frank and vocal about their decarbonisation and/or climate risk mitigation initiatives – the highs and lows, the successes and failures, the hurdles and complexities.
Naturally, when the report drafting begins, we help them convey the strengths of their strategy, shining the beam on examples of robust governance, target-setting and progress, showing how they are proactively tackling challenges.
Sometimes this means respectfully pushing back against their desires to eliminate any reference to ‘bad news’, such as an initiative that was scrapped because it failed to lower greenhouse emissions or had a negative impact on sales.
The truth is that decarbonisation is difficult, and stakeholders will understand that if it is communicated well. Just as readers can distinguish easily between an advert and a news article, so they will raise an eyebrow at a corporate sustainability report that is eerily quiet on material matters or just too good to be true. It’s our job as writers and content strategists to help organisations strike the right balance with an authentic narrative that is as credible as it is compelling.
Earning the trust of stakeholders is not about having all the right answers, but demonstrating year-on-year how you are learning, collaborating and progressing. And we believe that means speaking up in the global conversation.