Case 3: Green Advertising

Case Analysis

Management Ethics
9/10/2014

Submitted By: Celine Bernadette H. Francisco
Batch 34
Master in Management Technology

Celine Bernadette H. Francisco MANETH - B34

Questions
1. Is environmental advertising sometimes no more than a new form of
deceptive advertising? What makes it deceptive, if it is?

Yes, environmental advertising can sometimes be a new form of deceptive
advertising especially if a company tells that it is environment-friendly when in reality it
isnt. Just like the case of DuPont -- wherein they claimed that they are making major
changes to protect the environment -- but in reality isnt; this shows how a company can
engage in deceptive advertising.
The mere claim that they are going environment friendly but in reality, paying
fines for environment infractions is a clear manifestation of deception. In hopes that the
public would buy their claim and would eventually give them a higher profit margin,
companies are engrossed with environmental advertising.
The Federal Trade Commission (FTC), in cooperation with the U.S.
Environmental Protection Agency (EPA), came up with Guides that explain how the
FTC Act concerning green claims fit to a companys advertisement. If a company, for
instance, tells that it has a non-toxic lawn product, the product must not pose risks to
the environment and humans. Otherwise, it would be considered deceptive (EPA,
1999).

2. Does green advertising damage the consumer, or is it a harmless method
of developing the reputation of the corporation?

Green advertising per se does not damage the consumer if used well and
truthfully by companies. As long as companies walk their talk, become transparent,
enlist the help of third party environmental organizations, and promote responsible
consumption during the whole life cycle, they can develop their reputation as a genuine
eco-friendly company.
This type of advertising can damage consumers if it is just purely inaccurate,
deceitful and intentionally manipulative -- all in the hopes of gaining their consumers
trust (when in fact they are not really into green practices.). Such practice, also called
greenwashing, is practiced when an organization or company spends more money or
time claiming to be green than actually practicing it (Greenwashing Index, n.d.). When
companies greenwash their customers, they lose their trust in the end and eventually
lead customers to become numb towards the real green marketers.
Assuming that companies abide by the FTC Guides and Act, this is harmless.
Thus, they wont be able to harm their consumers. Nevertheless, they will merely be
agents of transformation -- enlightening customers to stick with eco-friendly practices
and products. These organizations will not only be boosting their brands, but they will
also be able to help consumers live green.

3. To what extent should companies be held responsible for demonstrating a
track record of environmental preservation that corresponds to its green
advertising?

Companies should be held fully responsible for demonstrating a track record of
environmental preservation corresponding to its green advertising. Most especially if it
advertises its green practices, it really has the obligation to abide by sustainability
techniques such as the following: incorporating green thinking into its companys
culture, eliminating inefficiencies, minimizing its impact to the environment, streamlining
its procedures, thinking long-term, evolving and adapting to ever-changing information,
and seeking continual improvement.
These companies cannot just proclaim that they are into sustainability but are not
walking their talk. If they state that they are going carbon neutral for example, they
must achieve a net zero carbon footprint by planting trees, using bio-diesel fuel in their
vehicles, lessening the hours of using airconditioning units, etc.
Likewise, being fully responsible entails assessing compliance, engaging
employees to sustainability practices, finding support, building knowledge and planning
appropriately. In the next stage, the company defines its green vision, chooses its
approach, and assesses its impact. This is followed by selecting and prioritizing goals
and planning implementation. In the fourth stage, it turns strategies into action. Finally, it
measures progress, communicates, updates goals and activities and moves forward.
Through these ways, the company can totally become responsible in being a
sustainable organization (EPA, 2009).
4. Should green advertising be federally regulated?

Yes, green advertising must be federally regulated to prevent deceitful marketing.
Although there are FTC Guides today that serve as tools to guide companies and
consumers with regards proper green marketing, these guides are not enforceable
rules. They also do not have the effect and force of law. They are also stated case by
case, instead of clearly defined rules.
Also, even though there are several states that already have their own green
marketing laws, companies that operate nationally still need to have a wider range of
laws to govern their sustainability practices. In the same way, consumers and law
implementers can have a stronger hold when it comes to combating issues related to
green marketing.
Take for example some states that refer to The Guides as a law as they define
environmentally sound products. There may be instances when some states would
allow a certain product while another wont. This, in turn, would result to inconsistency in
enforcing laws. Consumers would get confused as to which products are really
environment friendly.
Some independent organizations also present their claims on environmentally
sound products. Although they are not governmentally sanctioned, some consumers do
believe them -- leading to more confusion. With these, there really is a need for a
uniform Federal law to prevent consumers misconceptions and confusion.


References
Avalone, L. (2006). Green Marketing: The Urgent Need for Federal Regulation. Penn
State Environmental Law Review, 14:3. Retrieved from
http://www.hoaglandlongo.com/tasks/sites/hoagland/assets/image/attachment13
6.pdf
Greenwashing Index. (2014). About Greenwashing. Retrieved from
http://www.greenwashingindex.com/about-greenwashing/
Ottman, J., & Mallen, D. (2014). 5 Green Marketing Strategies to Earn Consumer Trust.
Retrieved from http://www.greenbiz.com/blog/2014/01/14/five-strategies-avoid-
taint-greenwash-your-business
Tuerff, K., & Davis, V. (2011). On FTC Green Guides: The Ad Industry Doth Protest Too
Much. Retrieved from http://www.enviromedia.com/2011/03/on-ftc-green-guides-
the-ad-industry-doth-protest-too-much/
U.S. Environmental Protection Agency. (1999). Environmental Marketing Claims.
Retrieved from http://www.epa.gov/epp/pubs/claims.htm
U.S. Environmental Protection Agency. (2009). Smart Steps to Sustainability: A Guide
to Greening Your Small Business. Retrieved from
http://www.epa.gov/osbp/pdfs/smart_steps_greening_guide_042101.pdf