The Psychology of Greenwashing: Are Sustainable Brands Truly Honest?

Sustainability is the new buzzword in business.

Everywhere you look, brands claim to be “eco-friendly,” “green,” or “carbon-neutral.”

But how much of this is true? Are these companies genuinely helping the planet, or is it just clever marketing?

This is where greenwashing comes in—a deceptive practice where businesses exaggerate or falsely claim to be environmentally responsible.

While many consumers want to support sustainable brands, companies sometimes take advantage of this good intention for profit.

What Exactly is Greenwashing?

Greenwashing happens when a company misleads consumers into thinking their products or practices are environmentally friendly when, in reality, they are not.

Instead of actually making sustainable changes, some brands focus more on looking green rather than being green.

A classic example is Volkswagen’s emissions scandal in 2015, where the company falsely advertised its cars as low-emission while secretly using software to cheat emissions tests.

According to a 2021 report by the European Commission, 42% of green claims made by companies were exaggerated, false, or deceptive.

This means almost half of the eco-friendly promises we see may not be true.

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Why Do Companies Do This? (The Psychology Part)

People want to be green

People want to make eco-friendly choices—a 2023 study found 75% of shoppers prefer sustainable brands.

But instead of actually becoming greener, some companies just pretend to be, banking on our good intentions.

It sells!

“Eco-friendly” sells—and often at a premium.

Research shows sustainable-labeled brands grow 5.6x faster than regular ones.

So, some brands slap on a green logo, charge more, and call it a day—without making real changes.

Avoiding bad press

Nobody wants to be called a polluter.

So instead of fixing their environmental harm, some companies highlight small “green” efforts to hide bigger problems.

Example?

Oil companies advertise tiny renewable projects while still making billions from fossil fuels.

Following trends

Sustainability is in—so brands rush to look green, even if their core business stays the same.

Fast fashion brands might release a “conscious” collection… while still pumping out cheap, wasteful clothing by the millions.

The Tricky Tactics: How They Fool Us

Companies use several clever tricks to make products seem greener than they really are.

Here are the most common ones:

Vague words

Watch out for vague terms like “natural,” “eco-friendly,” or “green.”

These sound nice but aren’t regulated—so companies can use them even if their product isn’t actually sustainable.

Example: Huggies called diapers “plant-based”—but only a tiny fraction was made from plants.

Hidden trade-offs

A brand might brag about one small eco-feature while ignoring bigger harms.

Example: “Biodegradable” plastic bags sound great—but they only break down in special facilities most cities don’t have.

Irrelevant claims

Some labels highlight pointless “improvements.”

Example: A water bottle labeled “BPA-free” when it never contained BPA in the first place. This distracts from real issues, like plastic waste.

False labels

Some companies create their own “green” logos to look official—even if they mean nothing.

Example: The “Sustainable Forestry Initiative” let logging companies use its label without strict environmental rules.

Misleading pictures

Images of forests, leaves, or animals on packaging make products seem eco-friendly—even if they’re not.

Example: Dawn dish soap ads show rescued ducks, but the product contains chemicals that harm marine life.

The Impact of Greenwashing (Why It Matters)

Hurts the environment

When companies fake sustainability instead of actually reducing waste or emissions, they’re holding back real change.

Imagine if every brand that claimed to be “eco-friendly” actually followed through—we’d see a massive drop in pollution and waste.

But greenwashing lets them look good without doing good, delaying the urgent action our planet needs.

Wastes our money

Many “green” products come with higher price tags—and shoppers pay extra, believing they’re making an ethical choice.

But if that “eco-friendly” label is just marketing, we’re being overcharged for a lie.

That’s not just unfair—it takes money away from brands that are truly sustainable.

Erodes trust

Every time a company gets caught greenwashing, it erodes trust—not just in that brand, but in all environmental efforts.

If shoppers start thinking “All ‘green’ claims are fake,” even ethical companies struggle to prove they’re different.

That’s bad for everyone who actually cares about the planet.

Makes it hard to make good choices

With so many fake labels, vague terms, and misleading ads, finding truly sustainable products feels like searching for a needle in a haystack.

Consumers who want to do the right thing end up exhausted and confused—and some just give up. That’s exactly what greenwashers want: less scrutiny, more sales.

How to Spot Greenwashing (Tips for Being a Smart Shopper)

Look for specifics

Vague terms like “green” or “natural” are meaningless without proof.

Real sustainability has numbers. Look for:

“Made with 90% recycled materials”
“Carbon-neutral shipping”
“100% organic cotton”

If a brand can’t back up its claims with hard facts, it’s likely greenwashing.

Check for real certifications

Some companies invent their own “eco-logos.”

Stick to trusted, independent certifications, like:

Fair Trade Certified (ethical labor)
USDA Organic (no synthetic pesticides)
Energy Star (energy-efficient)
FSC (Forest Stewardship Council) (responsible wood/paper)

Pro tip: If you’ve never heard of a certification, Google it + “legitimate” to check.

Read the fine print

Big, flashy claims often hide tiny disclaimers.

Examples:

“Biodegradable” → “Only in industrial composting facilities”
“Recyclable” → “Where facilities exist” (hint: most don’t)

Flip the package over. The truth is usually in the small text.

Do your research

A quick search can reveal a lot:

Check the brand’s sustainability report (if they don’t have one, that’s a red flag).
Use sites like Good On You (for fashion) or EcoLabel Index (for certifications).
Search “[Brand] + controversy” to see if they’ve been called out for greenwashing.