More than a third of Irish businesses are now worried that their sustainability policies and pledges could lead to accusations of “greenwashing” if they are not communicated correctly, according to a study by professional services firm EY.
EY’s survey of 200 “sustainability decision-makers” across the public and private sector found that 35 per cent say fear of the greenwashing tag influences their communications strategies. EY said this was a “significant” increase on the 13 per cent who indicated in a similar survey in 2022 that they were concerned about greenwashing, the practice of giving a false or misleading impression about environmental credentials or targets of a company or agency for marketing purposes.
The near tripling in the rate of concern in just two years not only points to rising awareness of the reputational risks, it also reflects how sustainability concerns have grown in importance for customers, EY said.
More than four-fifths of the organisations surveyed – some 81 per cent – reported a heightened focus on sustainability over the past year. This is up from 62 per cent who said the same in 2022.
Almost three-quarters of respondents rated their efforts on sustainability as “established or better”, a rise from 61 per cent in 2022, while 15 per cent consider their efforts to be “industry leading”, doubling from 7 per cent in 2022. However, 35 per cent of respondents felt their organisation was not doing enough, a “notable” rise from 17 per cent in 2022, EY said.
Close to a third – 30 per cent – indicated they are increasingly assessing the sustainability status of target companies when considering a merger or acquisition.
“It’s very encouraging to see a shift amongst Irish businesses towards a better understanding of sustainability, its impact on the bottom line and a real desire to create a more sustainable business approach across all sectors,” said Derarca Dennis, EY Ireland partner and sustainability services lead. “As companies embrace this agenda it’s vital they engage with all stakeholders to create a more resilient and sustainable business.”
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