Greenhushing Trend Surges: Companies Shy Away from Touting Environmental Progress, Study Finds

Mark Landers
By Mark Landers

Nearly 40% of 1,400 Companies Engage in Greenhushing, Reveals Study

In the bustling corporate world, where sustainability and environmental responsibility are no longer just buzzwords but critical aspects of a company’s public image, a startling trend is emerging. This trend, commonly known as greenhushing, isn’t just a phenomenon isolated to a small corner of the globe; it’s a widespread issue, deeply rooted and particularly prevalent in sectors that you might not expect. A recent study by sustainability consultancy South Pole sheds light on this growing trend, particularly among Singaporean companies, and its implications resonate far beyond the island’s borders, striking a chord with American corporations and stakeholders.

Underplaying Eco-Efforts: A Closer Look at Greenhushing

Greenhushing, a term coined to describe the deliberate underreporting of a company’s environmental, social, and governance (ESG) initiatives, is more than just keeping quiet. It’s a strategic move to avoid the ever-intensifying scrutiny that comes with proclaiming climate goals and sustainability efforts. According to South Pole’s report, a significant 40% of companies confess to greenhushing, choosing to downplay their environmental actions rather than risk criticism or fail to meet high expectations.

The Challenge of Communicating Climate Goals Accurately

Articulating and communicating net-zero targets and climate goals has become an increasingly uphill battle for companies.

In Singapore, for example, 55% of survey respondents admitted finding it increasingly difficult to convey their net-zero targets or climate goals to external parties, leading to a reduction in their external communications.

This trend isn’t unique to Singapore, but is evident across various countries and sectors. The survey, encompassing over 1,400 sustainability executives from diverse industries and countries including the United States, revealed a startling 70% of listed companies acknowledging the difficulty in communicating their net-zero goals.

The Problem of Climate Communication in Business

Despite the majority (81%) of surveyed companies claiming they’re on track to meet their net-zero goals, almost half (44%) found it more challenging to communicate their climate objectives than before. This dilemma highlights a significant gap between action and communication in the realm of corporate sustainability. The majority (93%) recognize that articulating their net-zero ambitions is crucial to their business success, yet many are choosing to remain silent about their progress.

The survey highlights that 58% of companies are finding it harder to communicate their climate-related efforts are decreasing their level of external communication. The reasons for this reduction are varied, with changing regulations or more demanding industry requirements being the primary factors, cited by over half (57%) of the respondents. Other concerns include heightened scrutiny from customers, insufficient data to back claims, and increased media scrutiny.

Investor Pressure: A Lesser Concern?

Interestingly, investor pressure seems to rank lower in the list of reasons for reduced communication about climate efforts. Only 38% of companies listed it as a factor, suggesting that external regulatory and public scrutiny are more significant drivers of greenhushing behavior.

Green Sectors Leading the Hush

Contrary to what one might expect, the survey found that the highest proportion of companies practicing greenhushing came from the green sectors, notably environmental services.

Here, nearly 90% admitted to greenhushing, surpassing even those in traditionally scrutinized industries like oil and gas (72%). For these companies, investor pressure emerged as the primary reason for greenhushing, a unique finding compared to other sectors where regulation was the main driver.

Investors’ Role in the Green Sector

The report points out a concerning trend of green companies, those you’d expect to be champions of climate action, leading the hush. Investors are increasingly including environmental services in their portfolio decarbonization plans, but the complexity of new regulations seems to be creating a cautious approach to public climate communication among investee companies.

A Call for Level Playing Fields and Stricter Regulation

South Pole’s report emphasizes the need for a more balanced approach in scrutinizing climate action and ambition. It argues for higher standards across the board, with a particular focus on sectors that still have a long way to go in reducing emissions. The report suggests that increased regulation and a level playing field are essential to curb greenhushing and foster genuine, transparent climate action across all sectors.

In Conclusion: Addressing the Greenhushing Phenomenon

As we navigate the complexities of corporate responsibility and environmental stewardship, the phenomenon of greenhushing presents a unique challenge. It’s a stark reminder that the journey towards a sustainable future is fraught with obstacles, not just in terms of action but in communication and perception. As the American audience reflects on this global issue, it becomes clear that transparency, consistent standards, and informed dialogue are key to advancing genuine climate action.

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