As sustainability becomes a primary concern for consumers and businesses alike, the property industry is not exempt from the growing demand for eco-friendly practices. However, with the rise of green marketing, we are also seeing “greenwashing” pervading the sector.
Greenwashing involves exaggerating or using misleading environmental claims to create an illusion of sustainability while failing to deliver on real eco-friendly efforts.
In the property industry, greenwashing often manifests as the promotion of superficial green initiatives that provide the appearance of eco-friendliness without making meaningful changes.
These initiatives may include installing a few energy-efficient appliances, using low-VOC (volatile organic compounds) paint or placing recycling bins inside a building. While these measures are positive steps, they should not overshadow the larger environmental impact of the property’s design, construction and operation – but too often they do.
How green is “green”?
One of the most common greenwashing tactics in the industry involves energy efficiency claims. Developers may boast about their buildings being “energy efficient” or “green”, but without proper certifications or detailed evidence these claims can in fact be misleading.
Some properties may only meet the bare minimum energy standards, while others may not be classed as energy efficient at all, despite claims to the contrary.
Green certification schemes are in existence, such as LEED (Leadership in Energy and Environmental Design) and BREEAM (the Building Research Establishment Environmental Assessment Method), to validate developers’ sustainability efforts.
However, when a property is greenwashed, a developer may avoid seeking such certifications in order to conceal the lack of substantiated eco-friendly features, resulting in purchasers of properties left to rely on unsubstantiated or false marketing claims.
Some greenwashing involves the materials used in construction, with developers claiming they have used “sustainable materials”, but without providing specific details of what those materials are or their source. In some cases, the materials may only have a small positive impact on the environment, while other types of materials used may not be sustainable at all.
Greenwashing can also be observed when property developers market a development that includes so-called “green spaces”, where developers may set aside small areas in large developments for gardens, with the reality being that they are of no environmental benefit.
The harm caused
The proliferation of greenwashing in the property industry can have profound impacts, such as:
- Slowing genuine progress towards sustainable development by developers that are prioritising marketing tactics over real sustainability efforts. This has the effect of diminishing any sense of urgency to implement eco-friendly designs and technologies.
- The property industry missing out on opportunities to have a real beneficial impact, owing to the promotion of superficial green initiatives. If property developers embraced genuine sustainable measures, it could lead to cost savings, increased property values and a positive impact on the environment.
- Increased greenhouse gas emissions. If properties lack the energy efficiency features they claim to have, their energy consumption may be higher than expected, further increasing the carbon footprint of the built environment.
- The relevance and credibility of recognised green certifications such as LEED and BREEAM being challenged. Consumers/purchasers may question the authenticity of environmental claims, overshadowing the importance of third-party verified certifications and hindering the growth of genuinely sustainable properties.
Fighting greenwashing
There are measures in place to tackle greenwashing which apply to all industries, including property.
Some of the key measures include:
- The Advertising Standards Authority The ASA is the UK’s independent advertising regulator, responsible for enforcing the UK Code of Non-broadcast Advertising and Direct & Promotional Marketing (the CAP Code). The CAP Code sets standards for advertising, and the ASA ensures that environmental claims made in property advertisements are truthful, clear and substantiated.
- The Green Claims Code The Committee of Advertising Practice issued a specific guidance document called the Green Claims Code, which outlines the standards for environmental claims made in advertisements. It provides guidance to businesses in the property industry on how to make accurate and substantiated environmental claims.
- Energy performance certificates EPCs are mandatory for residential and commercial properties in the UK. They provide information on a property’s energy efficiency and environmental impact, allowing potential buyers or tenants to make informed decisions about a property’s sustainability.
- Green building certifications Green building certifications, such as LEED and BREEAM, encourage sustainable construction practices in the property industry.
Various stakeholders in the property industry, together with the UK government, could take more proactive measures in addition to the above.
Additional measures could include incentivising or mandating green certifications for new construction and renovation work, and investing in campaigns that raise awareness among buyers and tenants about the significance of green certifications and the importance of checking and scrutinising so-called “green” or “eco-friendly” claims when buying or renting a property.
In addition, a detailed reporting system for developers and property managers on sustainability efforts would create transparency about environmental initiatives.
The effects of greenwashing can lead to financial risks, reputational damage and strained relationships between investors and developers.
By recognising these broader implications, the property industry could work collectively to combat greenwashing in a meaningful way and, in doing so, reduce its carbon footprint and promote a sustainable built environment.
Jill Crawford is a senior associate solicitor in the environment department at Irwin Mitchell
