Nikita Mishra
May 25, 2023

Ethics or charade? The troubling truth of bluewashing

Emissions are just one part of ESG reality checks, but there are other unsettling ways that companies deceive to appear ethical, threatening trust in corporate social responsibility.

Ethics or charade? The troubling truth of bluewashing

Patagonia created quite a stir when it removed itself from the 'sustainable' label last year. Known and loved for its planet-friendly ethical outerwear, the US$ 1.5 billion yearly revenue churning brand announced that despite its best efforts towards reducing carbon emissions, it is still a part of the problem and adds to the climate crisis.

For-profit businesses are not saints, Patagonia included. Though its relentless commitment to overthrow the status quo sets the sustainability bar high, it is still an apparel company and part of the larger industry that contributes to 10% of annual global emissions―more than the combined emissions of international flights and maritime shipping. What’s dragging Patagonia down is the supply chain―by its admissions, 95% of its current emissions come at the manufacturing level at factories, often shared with other big brands.

Supply chains can be complex and murky for big brands. Environmental emissions are just one of the issues tainting them; several others, like allegations of human rights abuse, worker plight, forced labour, have far-reaching tentacles. 

Whilst greenwashing gets a lot of press, it only covers the ‘E’ of ESG fraud. The abuse of ‘S’ that encompasses companies' social, ethical and economic responsibilities is called bluewashing. This lesser-spoken-about sibling of greenwashing is jarringly rampant and often concealed as a marketing ploy to trick consumers into believing companies are more ethical than they actually are. Bluewashing focuses more on human rights, corporate propaganda and positive PR to appear socially responsible but without actually backing it with purposeful action or making any real changes.

Photo: Campaign Asia-Pacific

The term was first used in connection with United Nations and their Global Compact (UNGC); it’s a non-binding agreement to encourage businesses worldwide to adopt socially responsible policies.

“When a company overstates its commitment to responsible practices or makes vague and unsubstantiated claims, it’s plain and simple bluewashing. In other words, it talks the talk, but does not walk the talk,” says Nespresso Singapore’s head of marketing, Peilin Lee, at a recent panel discussion on bluewashing at Campaign360.

UNGC’s social responsibilities for for-profit businesses are voluntary and come without binding laws. To elaborate, when participating companies submit their Global Reporting Initiative (GRI) to ascertain progress in sustainable development, they are not mandated to validate those claims with any concrete evidence. Limited mechanisms exist to verify truthfulness, accountability, reliability,
and the extent of information shared (or concealed) by corporations leading to misuse and abuse.

L-R:Ji Ching Tang (Kimberly-Clark), Peilin Lee (Nespresso), Felicia Sun (The Body Shop), Keith Morrison (Black & Veatch) 

Action versus guff with a side of skepticism

For the consumer, sustainability credentials are no longer just mere hygiene factors. A 2022 Bain & Company study on 16,000 APAC shoppers found that 95% are willing to change their shopping habits and shell out extra dollars for sustainable products. Green and blue claims are often the competitive advantage brands are battling for. But whilst there are barometers to spot dubious greenwashing claims, bluewashing is tricker to track to the naked eye—accusations of forced labour and human rights issues are not glaring through glossy packaging. 

“My advice to consumers, in this case, would be to be cynical. Be cynical of any marketing ploy, do your research and look into business practices for consistency, proofs, data and a more holistic approach that integrates sustainability at the core instead of focussing on only just one product or one collection,” recommends Keith Morrison, the regional marketing director, Black & Veatch.

Lee further elaborates: “I would simply assess if a company were doing this in two ways: the length of time and depth of integration. Is their new sustainability claim a one-off campaign or an exercise for an ongoing commitment? And then, as consumers, do your homework. Look at the labels, look at the source, analyse if the labels show transparency at all levels.”

≠ practice

A 2021 KnowTheChain benchmark assessed efforts of the 37 largest global apparel and footwear companies and found that luxury brands, including Kering, LVMH, but also budget retailers Amazon and Walmart, are all among the worst performers when it comes to addressing human rights exploitation in supply chains—clearly, a higher price tag is no guarantee for better transparency and respect for workers’ rights.

Getting wrong on ESG claims not only breaks consumer trust but also increasingly risks legal action. “Regulatory bodies across Europe and US are tightening the noose on worker-centric malpractice. The consumer can miss the bluewashing propaganda but there is a watchdog or a regulatory body on the lookout; the threat is real,” emphasises Morrison.  

H&M, Zara, A&F have repeatedly come under flak for underpaying factory workers in India and SriLanka. Picture from a garment factory workers protest Sri Lanka for lack of living wage. 
A worker makes clothes at a garment factory that supplies Shein. Photo: Getty Images

However, the ground reality is much different. The KnowTheChain report further reveals: almost all companies (97%) disclose a supplier code of conduct that prohibits forced labour and a monitoring process of suppliers. Yet they are neither effective in preventing forced labour nor ensuring remedy outcomes for workers.

Clearly, the threat of regulatory action has done little to narrow the gap between policy and brand practice.

“People have a strong no-bullshit meter these days. We are kidding ourselves if we think we can get by fooling customers. The ESG journey is long; true change does not happen overnight; it needs time. So it’s okay for a brand to admit the same in their communication honestly. Instead of overshooting and overcommunicating, it’s okay to talk about your growth and say, ‘Look, we’d like to achieve something, but we are not there yet,’” says Ji Ching Tang, the APAC category head for feminine care at Kimberly-Clark at the Campaign 360 panel on bluewashing. 

Integrity in the face of interrogation

The world’s biggest brands, Calvin Klein, Gap, Nike, Adidas, Shien, Tommy Hilfiger have all been called out for links to forced labour of the Uighur people, either at source or factory level. 

An undated video footage run by China’s CCTV, Muslim trainees work in a garment factory at the Hotan Vocational Education and Training Centre in Hotan, Xinjiang. Credit: AP Video

To put this in perspective, China is the world’s largest cotton producer, nearly 84% of the cotton it produces comes from the Xinjiang region, where Uighur people are based. Global fashion houses extensively source their cotton from Xinjiang. A coalition of more than 180 human rights group suggests one in five cotton products sold worldwide is tainted with allegations of forced labour.

And therefore, callouts and campaign lynching have become increasingly common. The downside of this is that smaller or newer brands, the ones that are on the right path in their ESG efforts, might keep quiet, fearing a backlash.

“The idea that brands must be perfect to flash ESG credentials is flawed. A gap in your achievements and targets shows ambition, drive and innovation,” continues Ji Ching.

ESG ambitions and goals are a work in progress; the panel unanimously agreed that transparency and authenticity in sustainability communications are essential. Consumers don’t need a rose-tinted version of sustainability progress, but taking a stand, showing vulnerability and the willingness to learn can all be powerful brand messages.

Is all publicity always good publicity?

Activism is in vogue. But is it good for business?

Society is seeing a shift. Activism sells. It’s fashionable for brands to take a stand. Tapping on the “protest spirit,” standing up for a social cause—against pollution, poverty or injustice – shows societal consciousness and brand spine. The risk/reward equation can be enticing for businesses and might generate massive targeted attention.

Recent successful examples of brand activism
Nike’s W+K campaign was a call to action for both consumers and companies to stand together against racism after the murder of George Floyd in May 2020. 
Ben & Jerry’s Australia refusing to serve customers two scoops of the same flavour of ice-cream to any one customer until LGBTQ+ marriage was legalised in the country.
Starbucks’ pledge to hire “10,000 refugees” in the wake of Trump’s anti-muslim travel ban.

Consumers, especially Gen Z, are not indifferent or ambivalent towards the organisations they associate with, so while being woke is in vogue, it is not always good for business. The panel discussed the recent Bud Light fiasco, as an example of social inclusivity gone wrong. 

To recap: Anheuser-Busch, the brewer of beer brands Bud Light and Budweiser, partnered with transgender influencer and activist Dylan Mulvaney in a sponsored social media video that went viral. While some applauded the company’s attempt at promoting inclusion, all hell broke loose for others.

The why of this campaign can be pinned to a variety of reasons. Anti-trans sentiment is ripe in America, targeting children, drag shows and healthcare among other areas, have been front and centre of the country’s culture wars. This campaign struck a nerve. It alienated the beer brand from its loyal consumer base and resulted in a massive $5 billion in value losses. Absolute bloodbath.

Brand activism can be a thorny issue. Short-term pain for long-term gain seems like a lucrative idea, but brands need to be extra vigilant in treading with the acute social sensitivity these days. The line between social activism and social boycott is thinning – superficial marketing can backfire into a PR nightmare.

So how do brands ensure their inclusive marketing efforts do not "trigger” the right-wing culture warriors?

Campaign asked The Bodyshop’s Felicia Sun, their head of brand activism about her views.

“Most brands approach inclusive marketing with the lens of just marketing,” says Sun. While inclusive marketing is helpful to grow the bottom line, it cannot be done in a flimsy way, opines Sun; it comes with a certain responsibility, an internal standpoint and requires doubling down on brand commitment.

“Activism is in my brand’s DNA. We walk the talk; take a stand for things we believe in; our key target audience believes in and on things that support our values. It’s integrated in what we do. Activism cannot just be lip-service, it has to be rooted in credibility and authenticity,” adds Sun.

BudLight learned this the hard way. For years, Anheuser-Busch has been trying to connect with a younger demographic. Its executives have gone on record saying relevance will come with a younger audience but timing, zeitgeist and political climes all combined played their part in this ongoing unimaginable boycott.  

It's been a month of this saga. Despite its small, innocuous,  origins, one that takes place daily in the atomised digital world, it has blown apart into the biggest brand crises of the year so far.

Almost a month after the incident, data from trade publication Beer Business Daily states sales volumes of Bud Light for the week ending May 13 sank 28.4%, extending a downward trend from the 27.7% decline seen the week before.

Campaign Asia

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