Greenwashing vs. Genuine ESG: How to Tell the Difference?
by: Prof Dr Salina Daud, Academic Associate of GET-BS
Source:https://compareelectricity.com/research/what-is-greenwashing/
These days, sustainability is everywhere. From shampoo bottles to smartphone ads, from property developers to pet food brands, everyone seems to be claiming they're “eco-friendly,” “net-zero,” or “green.” But how can we tell if these claims are true? This brings us into the often-misleading world of greenwashing.
Greenwashing happens when companies exaggerate or even lie about how environmentally or socially responsible they are. It’s like painting a dirty wall green and calling it a forest. This is dangerous, not just for consumers and investors, but also for future business leaders like you.
At GET-BS, where we train tomorrow’s leaders in engineering and technology, understanding ESG (Environmental, Social, and Governance) is no longer a bonus. It’s essential. ESG is about how companies interact with the environment, how they treat people, and how they are managed ethically. Done right, it builds trust, attracts investors, and protects our future. Done wrong well, that’s greenwashing.
You’ve probably seen it. A fast fashion brand launches a “conscious” collection but still produces millions of clothes under questionable labour conditions. An oil company runs ads full of wind turbines, while 95% of its business remains in fossil fuels. These are examples of selective marketing, not real change.
So how do we tell the difference?
Facts back real ESG commitments. Companies like Maybank in Malaysia, for instance, have clear sustainability goals like mobilising RM 80 billion in sustainable finance by 2025 and publishing transparent, third-party verified reports. Sunway Group, another Malaysian leader, not only builds green-certified buildings but also integrates sustainability into education through Sunway University.
Meanwhile, some companies in Malaysia’s palm oil sector have faced criticism for claiming sustainable practices while being linked to deforestation and poor labour conditions. It’s not always easy to spot greenwashing, but vague buzzwords, lack of certifications, and the absence of measurable goals are warning signs.
Globally, Patagonia is a great example of genuine ESG. They use recycled materials, pay fair wages, and even gave ownership of the company to a climate-focused trust. On the flip side, Volkswagen’s “Diesel gate” scandal, where they faked emissions tests, is a classic case of greenwashing, costing them over USD 30 billion in fines.
As a GET-BS student, you are not just studying theories. You’re preparing to make real-world decisions such as designing eco-products, managing supply chains, and leading green startups. You’ll need to know how to evaluate sustainability claims, not just repeat them. You’ll need to lead with values and verify the data.
Start by asking good questions: Who certified this product as sustainable? What are the actual numbers behind these carbon claims? Are the company’s social initiatives aligned with their business practices?
Also, familiarise yourself with key frameworks such as the Global Reporting Initiative (GRI), the Task Force on Climate-related Financial Disclosures (TCFD), the UN Sustainable Development Goals (SDGs), and Bursa Malaysia’s Sustainability Reporting Guide.
Source: https://tracera.com/gri-global-reporting-initiative/
These tools help you distinguish between genuinely impactful ESG reports and those that are merely green-coloured fluff. The table below will help you determine whether a company’s ESG claim is genuine.
