More than half of Canadian consumers suspect companies are trying to pass off green credentials they don't deserve, a new poll has found.
The Deloitte Canada study, released Thursday, surveyed both consumers and businesses across the country. While 57 per cent of consumers said they don’t trust companies’ sustainability claims, 71 per cent of Canadian business leaders thought customers had “significant” levels of trust in their green claims.
Joe Solly, a risk advisory and national consumer leader for sustainability and climate change at Deloitte Canada, said he was shocked at just how big the gap is between what businesses think and consumers want.
“There’s sort of a big disconnect,” said Solly. “Businesses sort of feel that their claims are being trusted out there.”
But the survey found only 26 per cent of Canadians believed those claims.
The lack of trust in companies' green claims extends beyond Canada's borders.
In 2022, a global review led by the International Consumer Protection and Enforcement Network found that of the 500 websites it surveyed, 40 per cent “appeared to be using tactics that could be considered misleading and therefore potentially break consumer law.”
Claims included “vague and unclear language” like ‘eco’ or ‘sustainable,' as well as describing products as ‘natural’ without any explanation of what that means.
Part of that is because what consumers want is changing, said Solly.
“There's more interest in younger generations to feel like they have to do their part, just to lower impact, because they want to feel good. They actually believe in solving issues,” he said.
More than half of the consumers surveyed said they would pay an additional 20 per cent or more for a product that was sustainable. Three-quarters said that everything else being equal, they would choose the green option.
Canadians most likely to respond to green claims in the grocery aisle
Four in 10 Canadian respondents said they had already bought a product or service because of a sustainability claim, the Deloitte survey found. Canadians were most likely to have made purchases when shopping for groceries, where 67 per cent said they had bought something claiming sustainability.
Respondents said they were least likely (23 per cent) to make a green purchase in the travel and tourism sector. In several other categories — including personal care products and homecare — more than half of respondents said they buy based on green promises.
Sustainable shopping habits highest in Quebec, where 54 per cent said they had bought something based on a green promise. In B.C., 37 per cent of residents said they had bought a product because on a sustainability claim, lower than the 40 per cent national average.
B.C. respondents’ green shopping history scored higher than the national average in two areas. In the grocery store, 72 per cent of British Columbians surveyed said they had paid extra for a food product because of a green claim. Another 60 per cent said they had bought clothing or apparel because a green promise.
Age and gender tended to shift those opinions: sustainable shopping mattered more to females and Canadians between 35 and 44, the study found. Regionally, it was least important in Alberta and Ontario.
A business’s responsibility
Of those surveyed, 94 per cent of Canadians said they through it was the brand’s responsibility that their products or services don’t harm the planet.
But concerns over greenwashing — when a company makes unfounded green claims — appeared to be eroding consumers’ willingness to pay more for a sustainable product. The Deloitte Canada study found almost half of Canadians don’t want to pay more for a green product because of a lack of “clarity, trustworthiness, and authenticity.”
An Angus Reid study carried out earlier this year found even more startling results. That poll, released in March, found nearly seven in 10 Canadians don’t trust the sustainability claims companies make about their products and services.
‘Greenwashing’ has increasingly caught the eye of federal watchdogs — in 2022, the bureau warned consumers to be wary of companies’ sustainability claims. Since then, the it has taken on a number of complaints alleging misleading and false environmental claims.
In September 2022, the anti-trust regulator invited nearly 400 people from 40 countries to Ottawa to attend a summit designed to respond to a rising number of greenwashing cases.
“Competition agencies must stay on top of greenwashing,” noted the bureau in a summary of their findings released in January.
“False and misleading environmental claims prevent competition between businesses on their merits. They also erode consumers’ confidence in a greener economy.”
Over the last year, Canada’s Competition Bureau has taken on a number of complaints alleging false and misleading claims by companies ranging from the country’s biggest oil and gas producers, to its largest forest certification body and richest bank.
The bureau has had success in the past. In one victory against greenwashing earlier this year, the consumer watchdog reached an agreement with Keurig Canada to pay a $3-million penalty after it made false and misleading environmental claims around its coffee pods.
In addition to the $3-million penalty, Keurig Canada was forced to pay for the cost of the bureau’s $85,000 investigation and donate $800,000 to a Canadian environmental charity.
The company is no longer permitted to make bogus claims on its packaging, online or in news media.
Call to regulate greenwashing
Solly says the numbers point to the need for a more standardized approach combining increased government regulation, third-party certifiers and more initiative on the part of companies to communicate their sustainable practices across their entire supply chain, including sourcing, manufacturing, distribution, and even disposal and recycling.
Consider nutrition labels, he said. They have evolved from simple lists of ingredients to include calories, sugars and a list of additives to help people make better decisions about what they are buying.
“Something along those lines would be beneficial to guide and set a minimum bar or standard for disclosure of sustainable product claims,” Solly said.
“We need some more standardization and a level playing field to make certain claims and disclosures.”
