# October 2023
Since the publication of our 2022 report on greenwashing, we have experienced a surge of interest from clients, partners, and researchers in the identification and measurement of greenwashing risk. With another year’s worth of ESG risk incident data, we return to the analysis to see how the landscape has evolved. Furthermore, we are extending the scope to include social washing – a practice not currently as prominent as greenwashing, yet equally present. Most notably, in our data, we observe social issues are, more often than not, inextricable from environmental ones – making a case for evaluating ESG as a holistic, interconnected topic.
The resulting analysis indicates that a growing number of both public and private companies have been linked to Misleading communication1 around environmental issues. Greenwashing risk has accelerated in Europe and the Americas, with the Banking and Financial Services sectors particularly exposed.
- In the past year (September 2022 – September 2023), one in every four climate-related ESG risk incidents was tied to greenwashing, an increase from one in five in our last report.
- The Banks and Financial Services sectors saw a 70% increase in the number of climate-related greenwashing incidents in the past year, compared to the year prior.
- For many, the practices go hand-in-hand, with nearly one in three public companies linked to greenwashing also associated with social washing.
The pervasiveness of greenwashing and social washing across regions and sectors presents risks for companies, employees, and communities. Misleading communication around environmental and social topics not only impedes progress towards collective goals, but also damages trust with consumers and investors. To identify and prevent Misleading communication around sustainability in compliance with emerging regulations, high-quality outside-in data that goes beyond company self-reporting is essential.