Dec 8, 2020
Here is how your company can achieve data transparency and avoid SDG-washing!
There are many organizations embodying sustainability and environmentalism at their core. There are also many organizations that now take advantage of the increased marketing possibilities related to sustainability, without actually doing the work behind the words. Greenwashing, a deceptive advertising claim made by organizations to appear more sustainable than they are in practice, was recognized already in 1986. Read more about greenwashing from our earlier blog.
The idea of greenwashing emerged when most consumers received their news originally from television, radio, and print media and didn't have the power of fact-checking in the way we presently have. Greenwashing has changed over the last 20 years, but it's unquestionably still around. The increased focus on the Sustainable Development Goals (SDGs), has led to a new wave from greenwashing to SDG-washing in recent years.
There are numerous reasons for SDG-washing. For example, McKinsey found that Gen Z people (born roughly between 1995 and 2010) are more likely to spend money on organizations and brands seen as ethical [1]. However, organizations might not always be aware of SDG-washing taking place!
What is SDG-washing?
Many organizations are actively working towards achieving the SDGs, by using the SDGs as a framework to shape, steer, and communicate business activities and strategies. While few organizations have begun to view the SDGs as a way to profit, others have looked to them to magnify their reputation which stimulate SDG-washing.
SDG-washing has many faces. One way it can look is when organizations profit by doing well on one SDG but not caring about the harm caused to the other SDGs and reporting only positive outcomes. Another one is when companies use the SDGs in their communication, but not actually relate concrete measures on the work their claim to be doing in relation to the SDGs.
"Some firms report actions that supposedly contribute to their achievement that are either unrelated, will have minimal impact or are part of their regular activities." [2]
Almost anything that organizations are doing will contribute to some SDG achievement, which breeds fertile ground for SDG-washing. SDG-washing is happening in three significant areas: Reporting, Finance, and Marketing.
How to avoiding SDG-washing
To be reported as legitimate SDG contributions, an organization should be able to answer the following five questions positively [2]:
Is this action incremental (done because of the SDGs)?
Is it material (transformative, not just petty things)?
Is it contextual (part of the company's strategy)?
Does it have a measurable impact?
Most importantly, is it sustainable over time or just a sporadic, one-time action?
One common reason for organizations to not be aware of SDG-washing taking place is insufficient data practices. Data serves many purposes: it promotes transparency, comparability and provides companies with fact based decision material to execute their sustainability work efficiently [3]. Some other benefits of higher data transparency are [4]:
Creates and delivers value to the company and to its customers
Help to identify problems and opportunities quickly
Drives innovation
Also, transparency can bridge the gap between artificial and genuine concern for the environment. With robust monitoring and impact reporting, stakeholders and impact investors can trust a business, and it can help drive the paradigm shift to a more sustainable society.
Good news is that SustainLab can help you achieve data transparency and maximize its utility!
SustainLab's Intelligence platform is powered by Artificial Intelligence and Machine Learning. It automates the collection and processing of sustainability data, minimizes manual work, and monitors sustainable data reporting to achieve transparency. At SustainLab, we innovate the technology itself. We advance the technology using scientific methods in collaboration with the research community. Our mission is to enable decision-makers to achieve impactful sustainability results by making data handling so simple that companies can have visibility of sustainability data as often as financial data, instead of reviewing the performance once yearly.
Get in touch to understand how SustainLab will help your company avoid SDG-washing to achieve data transparency and impact reporting!
