Greenwashing (a compound word modelled on "whitewash"), also called "green sheen", is a form of marketing spin in which green PR (green values) and green marketing are deceptively used to persuade the public that an organization's products, aims and policies are environmentally friendly and therefore ‘better’; appeal to nature. Common examples present in the marketing of food products, alternative medicine and natural medicine.
Evidence an organization is greenwashing often comes from pointing out the spending differences: when significantly more money or time has been spent advertising being "green" (that is, operating with consideration for the environment), than is actually spent on environmentally sound practices. Greenwashing efforts can range from changing the name or label of a product to evoke the natural environment on a product containing harmful chemicals to multimillion-dollar marketing campaigns portraying highly polluting energy companies as eco-friendly. Greenwashing is therefore a "mask" used to cover-up unsustainable corporate agendas and policies. Highly public accusations of greenwashing have contributed to the term's increasing use.
While greenwashing is not new, its use has increased over recent years to meet consumer demand for environmentally friendly goods and services. The problem is compounded by lax enforcement by regulatory agencies such as the Federal Trade Commission in the United States, the Competition Bureau in Canada, and the Committee of Advertising Practice and the Broadcast Committee of Advertising Practice in the United Kingdom.
Critics of the practice suggest the rise of greenwashing, paired with ineffective regulation, contributes to consumer skepticism of all green claims, and diminishes the power of the consumer in driving companies toward greener solutions for manufacturing processes and business operations. Many corporate structures use greenwashing as a way to repair public perception of their brand. The structuring of corporate disclosure is often set up so as to maximize perceptions of legitimacy. However, a growing body of social and environmental accounting research finds, in the absence of external monitoring and verification, greenwashing strategies amount to corporate posturing and deception.