What is greenwashing and how can you avoid it?

Expectations for businesses to act responsibly are higher than ever. Even if you think you’re doing the right thing, regulators, watchdogs, customers, and even your employees can prove you wrong in seconds.

That gap between intention and impact is exactly where greenwashing lives. Some companies are genuinely making an effort, while others are hiding the truth behind soft green tones, leafy imagery, and vague promises about “saving the planet”.

Here’s a clear look at what greenwashing is and how you can avoid falling into the trap.

Greenwashing is when you overstate or misrepresent the environmental benefits of a product, service, or business. It’s a mismatch between what a company says and what it actually does.

For example, a product might be “made with recycled materials”, but only in small amounts. A company might claim to be “carbon neutral”, mostly through offsets that are hard to track. A “sustainable” product line might sit alongside a business model that hasn’t actually changed.

Entire industries are under scrutiny for this. The UN says around 60% of sustainability claims by major European fashion brands are unsubstantiated or misleading.

There’s also been an explosion of eco-labels: little badges or certifications that are supposed to show a product or service is environmentally friendly. The problem is, most of these follow inconsistent standards, making it harder to tell what’s credible.

Greenwashing tends to fail in predictable ways. Customers find out. And when they do, they don’t just question one claim; they question all of them.

In fact, research continues to show that transparency, credibility, and consistency are the main drivers of whether consumers trust sustainability claims. When those are missing, even well-intentioned messaging can tip into greenwashing.

Regulators are also stepping in more aggressively. New EU rules are banning vague terms like “eco-friendly” or “climate neutral” unless they’re backed by clear evidence.

And although there are early signs that enforcement is having an effect (some reports suggest a recent dip in greenwashing cases in parts of Europe) this follows years of sharp increases, so it’s still a real problem in most industries.

Avoiding greenwashing is about being precise, transparent, and slightly less dramatic. Here are five ways you can make sure your claims stand up to scrutiny. 

Broad claims like “eco-friendly” or “green” are easy to say but hard to prove. Specific, measurable statements are far more credible. For example, if your products contain 65% recycled material or your emissions have dropped 18% since last year, say so. As a general rule: precision builds trust, and vagueness invites scrutiny.

Claims without evidence are greenwashing waiting to happen. Use data, methodology, or third-party verification to support your sustainability statements. Even simple internal metrics can help illustrate your progress, as long as they’re transparent and verifiable.

Companies like GB Railfreight have introduced our EV salary sacrifice scheme to hit their targets in a way they can measure, while giving their people a benefit they’ll love. 

“We wanted to reduce our scope three emissions, which include business travel and commuting,” explains Sarah Whurr, the company’s Head of Sustainability. “We whittled it down to three suppliers, and Octopus EV came out on top! We've saved about 225 tonnes of carbon, so that's really successful.”

Of course, no single scheme can solve everything. But pairing this alongside your other sustainability efforts will help keep you on track. 

Recognising where your business is in its sustainability journey, and sharing realistic targets, shows credibility. Celebrating small wins, like introducing an EV salary sacrifice scheme or reducing energy use in your office, shows you’re moving in the right direction. It’s also way more believable than claiming you’ve already “solved” everything.

Many environmental impacts happen around the edges of your core operations: think supply chains, logistics, or how your employees travel to work. If your messaging only covers what’s easiest to measure, it’s like bragging about one healthy lunch after months of living on instant noodles. Taking a big-picture approach shows you actually get the full story and that you’re serious about making a real difference.

Carbon offsets can help, but they’re not a magic “get out of jail free” card. Relying on them too much is risky business. Be upfront about how much of your impact is being offset versus actually reduced at the source. Think of offsets as a helpful sidekick, not the hero of your sustainability story.

We often think about ESG in terms of boring policies and paperwork. But the truth is, sustainability works best when your team gets involved. James McMaster, CEO of Huel, saw a huge difference once he gave employees a way to participate in meaningful action.

“We do surveys every six months or so, and every time you see consistently that people are proud to have electric vehicles,” he says. “They're proud that we're constantly moving things forward with different ideas.”

Feeling inspired? Sign up for EV salary sacrifice today. It’s an easy, free, and low admin way to hit your climate targets without stretching the truth.