Greenwashing is increasingly becoming an issue for brands these days. Last month, Coca-Cola got slammed for greenwashing as a result of its COP27 sponsorship. Mercedes-Benz was also called out in August for greenwashing after the automotive maker associated its brand with the beauty of nature in its ads.
Chuah Sze Phing (pictured), head of group marketing and communications at Kenanga Investment Bank, told MARKETING-INTERACTIVE that greenwashing is not only "an alarming issue" that has emerged of late in the ESG space, but also a serious threat to brand reputation and brand credibility. "[It is] every PR practitioner's nightmare!" she said.
According to her, businesses have an important role to play in improving the planet for the future and it is on companies to develop effective sustainable strategies, as well as connect with their audience transparently through facts and data they can trust. "The consequences of greenwashing are disastrous, as it erodes stakeholder trust, prevents the development of a sustainable economy and fundamentally unravels the tremendous progress that has been made on this front," Chuah, who will be speaking at MARKETING-INTERACTIVE's upcoming PR Asia 2022 conference, said.
The bank believes it is essential to join the global movement to reduce the global carbon footprint while promoting climate-positivity throughout its stakeholder base and the wider community. It is also working on this by accelerating the integration of ESG aspects across our business operations.
Kenanga has four pillars in its ESG framework - sustainable economic growth, environmental stewardship, empowering people and community, and good corporate governance. To further its progress on the ESG front, the bank also joined the United Nations Global Compact, which Chuah said has "leapfrogged [the bank] into a global network of tremendous support, knowledge sharing and opportunities for capacity building".
"As a financial institution, we operate in a highly regulated environment that focuses strongly on good governance, compliance and integrity – our first line of defence against greenwashing. We are cognizant of the grave risks associated with greenwashing and work to raise awareness and understanding of the nuances and intricacies of this issue throughout the organisation," Chuah added.
She joined the company 10 years ago with the primary mandate to start up the marketing and communications division, shape Kenanga's brand image and value, and effectively communicate and engage with stakeholders. In addition to her role as head of group marketing and communications, she also assumed the role of group sustainability officer, working together with her team to implement suitable ESG strategies that help set Kenanga's sustainability ambitions.
Without a doubt, brands are often under scrutiny from NGOs and consumers these days, just like Coca-Cola and Mercedes-Benz. To ensure they don't fall into the trap of greenwashing, Chuah said it is important to be honest and transparent about the organisation’s sustainability plans and practices and to back up any sustainability claims with data. "Any company should be careful about how they present their product or services, as well as how you word your content materials," she said.
Kenanga published its first standalone sustainability report which was published earlier this year where it shared its achievements, progress, and plans on its sustainability journey. According to Chuah, sustainability reporting is critical as it helps to maintain an overview of an organisation’s sustainability practices, encourages commitment to sustainability issues and promotes change more effectively in the long-run. "Additionally, as stakeholders become more strongly in favour of ESG, sustainability reporting is a good way for organisations to communicate and connect with their stakeholders to improve trust in the brand," she added.
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