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Scaling up and sustaining green innovation in Hong Kong: Phasing out greenwashing behaviour as an urgent imperative
By Ms Rita CHIU

If you choose to listen to this article, you are welcome to download the PDF version of the Journal (June 2023 issue) and activate the “Read Out Loud” function in Adobe Reader. For more details, please read the user's note.

 

Greenwashing refers to the marketing tactic used by organisations to make false or exaggerated claims on their products or services being sustainable and eco-friendly, while these organisations spend more resources on marketing than on  minimising the products’ or services’ actual impact on the environment. This tactic is meant to mislead consumers who value environmentally conscious brands, making it difficult for them to make informed purchasing or investment decisions. In addition, greenwashing creates confusion and skepticism among consumers, hindering organisations that are genuinely committed to transparent and effective sustainable practices.

 

Despite the government’s and key stakeholders’ commitment to sustainability compliance and innovation in its decarbonising economy, greenwashing behaviour still persists. This phenomenon is frequently observed in the financial industry, particularly with the growing trend of Environmental, Social, and Governance (ESG) investing. This could be prejudicial to the actual progress of climate governance. Greenwashing might be caused by unclear regulations and standards, insufficient public awareness and education, and difficulties verifying companies’ environmental and sustainability stewardship. In the current context of green finance momentum towards net-zero by 2050 as targeted by the government, preventing and fully phasing out greenwashing seem to be urgent imperatives to scale up and sustain green innovation in the city.

 

Prevention of greenwashing in Hong Kong requires rigorous climate governance and policy reforms associated with a stringent regulatory strategy aimed at educating the public about the benefits of green practices, third-party sustainability verification and certification, visibility into corporate sustainability compliance, and performance tracking systems. On the other hand, green innovation, transparent and quality corporate governance, and science-based sustainability pathways must be further promoted and valued for their benefits to business and prosperity.

 

Active management of low-carbon strategies with third-party verification, a reliable data coverage and recording system, quality reporting, and transparency is therefore essential for corporations to successfully navigate climate risks and business prosperity. Investors also need to value well-established sustainability measurement frameworks.

 

For Hong Kong to phase out greenwashing, a clear roadmap for net-zero governance must be developed by the government and key stakeholders, as well as establishing science-based targets for transition readiness to a corporate carbon economy. For continuous improvement, corporate sustainability performance must be rigorously tracked and systematically evaluated.

 

This article is contributed by Ms Rita Chiu with the coordination of the Environmental Division.

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