Open Access Research Article
CORPORATE AWARENESS AND GREEN MARKETING: AN ANALYSIS BY: PRAGYA RANI & SHOILY CHAKRABORTY
Published Paper
Article Details
CORPORATE AWARENESS AND GREEN MARKETING: AN ANALYSIS
AUTHORED BY: PRAGYA RANI (20113080)
CO-AUTHOR: SHOILY CHAKRABORTY (20113053)
CHRIST (DEEMED TO BE) UNIVERSITY PUNE, LAVASA CAMPUS
ABSTRACT
Environmental law is a steadily
growing area of study and research. As the earth’s
condition degrades due to
overexploitation and development, legal expertise in this field continues to
take precedence in modern society.
This paper will be dealing
with the corporate
aspect of environmental law. It focuses on
understanding the liability of companies and their contribution in both deterioration of and the maintenance
of the planet as a result of their actions. It goes into environmentally sound manufacturing processes and the ethical procedures the companies are subjected to in terms of preservation and regeneration of the environment by international instruments. The paper would be looking
into the concept of ‘green marketing’ which
is an emerging aspect, recognized and accepted globally
by environmentally conscious
and responsible corporations. It would also delve into the
concept of ‘corporate social
responsibility.’ This concept holds
companies accountable for their environmentally harmful activities and imposes responsibility on them to rectify and compensate for their actions.
Finally, the paper focuses on various international conventions that highlights the stated concern,
inspiring certain multinational corporations which have stepped up
and taken measures to address environmental damage done and have made moves to be
more environmentally sound.
INTRODUCTION
Technology and development have been a boon to mankind. The industrial
revolution brought with itself the advent
of mechanised factories and the betterment of humans. Production efficiency increased and people enjoyed the luxury
of manufactured products. Over the
years, as a result, there has been use of natural resources.
This has turned into overexploitation somewhere down the line. Humans continued to take from earth without actually
giving back. Pollution and filth steadily increased.
Human actions continued to be the cause of deterioration. As the years have
gone by, corporations have utilised
natural resources and have refused to take measures to ensure that the status quo in terms of environmental sanctity
remains intact. Corporations have discharged untreated
effluent into rivers for decades
and released smoke and other pollutants into the atmosphere with screening. Pollutants and
garbage have been released by corporations and their manufacturing outlets into the soil as well, leading to soil
pollution. The actions of industries have had
a monumental damaging effect on that planet with little to no repercussions for
a long time. But various countries
have acknowledged the issue of environmental degradation and have, through various instruments, tried to hold the
corporations responsible for their activities. Now, many big corporations have adopted ways of being
environmentally friendly and are manufacturing products while taking steps to save the planet. They have been
undertaking measures to give back to the planet
at least some of what is taken from it and attempt to reverse the damage done.
They accept the liability imposed on
them through the concepts of Extended Social Responsibility (ESR) and Corporate
Social Responsibility (CSR)
and have delved into ‘Green
Marketing’. Many companies, such as Starbucks, The Body Shop and IKEA
have adopted the policy of increased transparency and have included the steps by them on their websites. Such
corporations have inculcated the values of sustainable
development in the conduction of their business activities. Valuing the
environment is a duty that all corporations need to understand and address to the best
of their abilities.
What is green marketing?
Environmental concerns
are more important than ever. We worry
and consider how we may be nicer to the
earth as a result of the primary dangers, which include air pollution, plastic in the oceans,
global warming, and food waste. Millions of people have started buying socially
conscious products despite
their greater price in support of environmental
health.
Recognizing the trend, businesses are adopting a marketing approach
that engages these consumers, speaks to their sense of social responsibility, and subsequently affects their purchasing
decisions.
Although there are many different kinds of marketing, this tactic is referred
to as green marketing.
Green marketing, for instance, is used by companies who tout their
support for environmental protection
organisations, highlight their ecologically friendly manufacturing practices,
or otherwise sell their
goods as environmentally
friendly.[1]
Green
marketing is the practice of promoting the advantages that a product or service
has for the environment in order to
sell it. Consumers can recognize these products by phrases like
"organic," "eco-friendly," "recyclable," or "sustainable," and some refer to it as eco-marketing or environmental marketing.
Environmentally safe or Green?
Products that are eco-friendly do not hurt the environment. In addition to not harming
the environment, green
products also minimize carbon footprint, reduce resource exploitation, may be recycled and reused, and maintain
ecological equilibrium. For e.g.Tissue sheets are products that are safe for the environment because
they can be recycled easily and, if not, they are at least biodegradable, unlike plastic.
But handkerchiefs are environment friendly products since in addition to
being biodegradable and safe for the
environment, they also do not consume up natural resources.[2]
Corporate Social
Responsibility (CSR)
The term "corporate social responsibility," or just
"CSR," became widely used in the late 1960s and early 1970s. Depending on the business and
industry, it is a wide notion that can take many different shapes. Businesses can help society
while building their brands through CSR initiatives, charity, and volunteer work. A business must be
responsible to itself and its shareholders before it can be socially conscious. CSR-focused businesses
frequently develop their operations to the point where they can support the community. As a result,
multinational corporations frequently employ CSR as a strategy. After all,
a company has a greater
need to establish the bar for moral conduct among its peers, rivals, and industry
the more well-known and prosperous
it becomes.
India is the first country in
the world to make corporate social responsibility (CSR) mandatory, following
an amendment to the Companies Act, 2013 in April 2014. As part of any CSR
compliance, businesses are allowed to put their revenues toward causes including
hunger, poverty, gender
equality, and education.
Since the introduction of the CSR clause in 2014, corporate
India has greatly
boosted its CSR investment.
Companies contributed US$1 billion to CSR activities in 2018, which is a 47
percent increase over the amount they
did in 2014–15, according to a survey. Listed firms in India invested INR 100 billion
(US$1.4 billion) in a range of initiatives, including healthcare, education, and environmental
preservation. CSR contributions to the Prime Minister's Relief Fund also
increased by 139 percent in the previous year.
CSR holds the corporations accountable and confers
accountability on them. It promotes
transparency for the activities of the corporations and the negative
impact those activities have in the
environment. Owing to the current degradation of the environment there have
been increasing pressure on them to
be more environmentally friendly. They have taken up measures to be minimise the damage. This, many corporations have
turned towards 'green marketing' to comply with the regulations places due to the growing consciousness in the environmental front.
Hunger,
poverty, and healthcare got the next highest amounts of financing (25 percent),
followed by environmental
sustainability (12 percent), rural development, and education (38% of the
total) (11 percent). Programs
like athletics, the armed forces,
technology incubators, and eliminating disparities received very little funding.[3]
Challenges of Green Marketing:
1. Green
products require renewable and recyclable materials, which is costly.
The materials required to carry out green marketing are generally very
costly. The cost of production is high. From procuring
raw materials to shipping the final product,
almost all steps of the manufacturing
and production process of eco-friendly products cost more than traditional
products. Sustainable materials
cost more to grow and manufacture because
reputable third-party certifications, such as organic or fair
trade, are not cheap. Additionally, organic materials are more expensive to grow, partly due to the use
of alternative means of pest control, instead of using chemicals
2. Problems of deceptive advertising and false claims.
A common form of false advertising involves deceptive or misleading product
descriptions, particularly
claims that a product has certain features or benefits that it does not, or
that it is of a higher quality than
it actually is. For example, use of misleading terms, such as “organic,” “natural,” or “light”. This makes a consumer believe that he is living up tp the spirits
of environmentalism but in real, he
is been deceived.[4]
3. Majority of the
people are not aware of green
products and their uses.
Shifting to green products or even choosing them on a small scale is a
very long-term goal to meet. This is
because in order to make people invest in something, one has to make them know
of its benefits or uses. Therefore,
awareness comes before expansion of any product. This makes an idea or an initiative, take longer than it
should to be implemented, no matter however genuine it might be.
CASE STUDIES
IKEA
Ikea,
a furniture company, has pledged to achieve climate neutrality by 2030. This
indicates that Ikea will not only achieve
net-zero carbon emissions
but will also actively remove
carbon dioxide from
the atmosphere. After making significant investments in wind farms and
solar panels all over the world, they
have introduced a line of products for "sustainable living at home," according
to Tutt. "They can position
themselves as having green energy and sustainability at the core of their
products by fusing these two things.”
SOLHETTA, IKEA’s newest generation of LED bulbs, are cheaper
and, on average, 35% more energy
efficient than other LED bulbs,
inspiring and enabling customers to save energy and money.
Ikea is also enabling
users to conserve water by creating a water-recycling shower system and more water-efficient taps.
Replacing virgin fossil-based polyester
with recycled, IKEA has strived towards reducing the climate
footprint from polyester by around 45%.
IKEA
is obtaining 56% renewable and 17% recycled resources in our ongoing effort to
get only renewable or recycled materials
by 2030. It has also been establishing a new objective
and supporting initiatives to eliminate all plastics from consumer packaging by 2028.
The
company has been establishing a new, forest-friendly strategy for 2030 with the
intention of enhancing biodiversity, promoting sustainable
livelihoods, and reducing
climate change.[5]
THE BODY SHOP
The Body Shop is one company that has fought
to outlaw animal experimentation since 1989, according to Debt Bombshell's head of marketing Scott McKinney.[6]
The Body Shop aims to:
• Reduce
their greenhouse gas emissions to net
zero by 2030.
• Foster collective efforts towards zero Amazon
deforestation by 2025.
• Help create Science Based Targets
for Biodiversity to enforce the Nagoya Protocol
on Access and Benefit Sharing.
Their new stores aim to use sustainable materials throughout, produced
in factories that demonstrate
ethical and environmental standards:[7]
• No virgin
plastic (and less plastic overall).
•
Materials and fixings
that can be broken
down at the end of their
life.
•
FSC-certified
or recycled wood.
•
FSC-certified
paper/card and water-based inks.
STARBUCKS
The
brand's goals for energy conservation have been ambitious. The company has high
expectations for energy conservation.
In the recent years, they have finished setting up Energy Management Systems in almost 4,000 stores. Energy
management systems optimize heating and cooling while enabling the identification of additional areas for cost-cutting.
Starbuck’s ongoing efforts
to green stores:
·
Conserving energy by allowing air-conditioned stores to reach 24°C instead of 22°C on warm days
·
Saving water by using high-blast nozzles to clean jugs instead
of running water
·
Installing low-flow valves
throughout the store
·
Installing cabinetry made from 90% post-industrial
material (where available), with no added formaldehyde
·
Improving lighting efficiency
·
Using recycled flooring
tiles
·
Using wood products
that are Forest
Stewardship Council–certified (where
available)
·
Using paints with lower
amounts of volatile organic
chemicals
The achievement of two interconnected initiatives —developing recyclable cup solutions and drastically
boosting the consumers' use of reusable cups—is necessary to reduce the
environmental effect of its cups.
Many
consumers are taking steps to lessen their own environmental footprint at the
same time as the company is.
Starbucks gives the customers who use their own reusable mugs or tumblers for their beverages, a 10-cent refund in the
US and Canada to assist them in assisting the business. Customers who are still inside a store can ask to have their
drinks supplied in ceramic mugs. Saving paper
cups helps maintain the health of our
forests.
International Perspective
STOCKHOLM CONFERENCE
The summit in Stockholm marked a turning
point in environmental law. Its Declaration widely acknowledges
global challenges and ultimately produces 26 principles as well as some
structures to tie all the nations
together in order to address these
environmental issues. The meeting made history
by addressing environmental concerns on a worldwide scale. The Stockholm
Declaration highlighted the need for countries to adopt programmes using a combination of science and technology
in order to reduce pollution of the air, land, and water as well as the effects
of human activity on the environment. The Stockholm Declaration's principal goals were to safeguard
the globe from the environmental ills
that were destroying it, to protect natural resources, to reduce pollution, and to protect against a number of other environmental problems. In
other words, we may say that the
major goal was to conserve the environment. The Stockholm Declaration, from 1972, even had the slogan "Only One
Earth." In addition to announcing 26 principles, the Stockholm Declaration of 1972 also included a number
of recommendations.[8] It was
the first conference to focus on
international environmental law. Despite not having any legal force, the declaration was still significant
because it represents a significant advancement in environmental issues.
ICC FRAMEWORK
High standards of corporate ethics are promoted by the International
Chamber of Commerce (ICC) through the creation and dissemination of regulations and guidelines on ethical marketing
and advertising communications. Consolidated ICC Code of Advertising and Marketing Communication Practice (Code), which was
released in 2006, is one of ICC's historic accomplishments. The Code gives customers confidence that businesses
adhering to the Code may be relied upon to offer accurate advertising by encouraging self-regulation
in the business sector in line with the highest ethical and legal standards. The Code includes a
distinct section on environmental claims and lays out broad guidelines that apply to all marketing
materials. Any sort of marketing message disseminated by the media, typically in exchange for money or
other valuable consideration, is referred to in the Code as "advertisement" or "advertising." It includes a wide warning to advertisers to steer
clear of or properly qualify general
promises of environmental advantage, which has long been the tenet of advertising advice. Avoid making broad
environmental assertions that can be challenging to back up with reliable scientific evidence.
Numerous
businesses have implemented "sustainability" initiatives or named
corporate officers to concentrate on
enhancing environmental sustainability. Some "sustainable" programmes
will also cover social responsibility
issues including workplace safety, environmental compliance, fair labour standards, and more.
Any
form of claim that makes explicit or implicit mention of the environmental or
ecological aspects of the creation,
packing, distribution, use/consumption, or disposal of items is referred to as
"green" or "environmental."[9]
THE ORGANIZATION FOR ECONOMIC COOPERATION AND DEVELOPMENT (OECD)
The
Organization for Economic Cooperation and Development (OECD) released a
Declaration on Green Growth in 2009
that urged the creation of a comprehensive Green Growth Strategy with the goals of ensuring
economic recovery and sustainable economic
growth. The Committee
on Consumer Policy (CCP) committed
to assist this project by looking into how to improve the information
provided to consumers so that they may make more informed decisions. In April
2010, it organised a session titled
"Empowering and protecting consumers while enhancing the value and effectiveness of environmental
claims."[10]
Representatives of the government, business, and civil society gathered at the
summit to discuss ways to handle
problems with greater
value and efficacy.
Consumers are indicating a growing desire to buy ecologically friendly
products and services,
according to polls in OECD nations. However, according to some polls, consumers frequently misunderstand the
significance and validity of self-declared environmental claims, particularly
those that are ambiguous or
unsupported. Consumers are increasingly of the opinion that businesses "green wash" their image and act
in an environmentally responsible manner in order to boost profits and charge more.
For businesses to understand how their marketing rules and regulations
relate to environmental claims, several
OECD nations have created guides.
The ISO standards on Type II self-declared environmental claims
are clarified in several of the guidelines, and it is emphasised that these statements should be pertinent, understandable, accurate,
proven, comparable, verifiable, and not deceptive.
For organisations creating Environmental Marketing
Claim Guides, the International Consumer
Protection and Enforcement Network (ICPEN) has drafted best practices, including requirements that these claims be:
i) written in understandable terms;
ii) precise, truthful, and genuine; and
iii)
established or verified, as appropriate.
Governments should make it clearer to consumers what each form of environmental label means, including those that are
required, and what terminology related to the environment mean in general.
Some nations mandate labelling for fuel
efficiency, carbon emissions, and energy efficiency for particular products, appliances, and
services. These labels are frequently dependent on carrying out particular testing involving energy use.
THE INTERNATIONAL LABOUR ORGANIZATION (ILO)
According to the International Labour
Organization (ILO), CSR is a strategy used by businesses to take into account
how their actions affect society and to uphold their principles and values in
both their internal techniques and processes
and in their interactions with other players.[11]
Activities that are seen as going
above and beyond what is required by law are referred to as CSR and are a voluntary, enterprise-driven initiative.
The ILO's
two primary sources of information on CSR are:
·
Fundamental Rights and Principles at Work: The
ILO Declaration: As a result, governments are now required
to put the ILO's core labour
standards into practice.
·
The MNE Declaration, or Tripartite Declaration of Principles Concerning Multinational Enterprises
& Social Policy This is an enterprise behaviour guide for governmental
entities, ILO members, and businesses.
Since labour standards and social action are essential components of CSR
and these are the ILO's primary areas
of expertise, they can play a significant role in CSR. The majority of CSR
activities, including codes of
conduct, make reference to the ILO-developed worldwide labour standards that serve as
their foundation. Governments are
required to enact laws to carry out ILO Conventions once they have been ratified at the
national level. The ILO Conventions' guiding principles are not mandatory for businesses, but they
can serve as a model for how they should
behave.
CONCLUSION
It requires patience and determination, but green marketing is, above
all, an investment in the longevity
of a brand. Environmental sustainability will continue to be a hot-topic issue,
with more corporations developing and
promoting green products and more consumers rejecting brands that aren’t eco-friendly.
Green marketing, much like other ESG initiatives, comes with unique challenges, including advertising environmental sustainability without set standards,
navigating the newness of green marketing,
and balancing customer desires with product design. Though green marketing may
seem intimidating, these challenges
ultimately offer businesses opportunities to innovate their marketing strategies and product offerings
and connect with customers in new and meaningful
ways.[12]
Green
product development involves more than just making environmentally friendly
items; it also entails changing
society, including customers, producers, and the larger economic framework in which they interact. By broadening and
extending the definition of "green," relevant actors will have an economic motivation to seek the
development of green products, and mainstream green will be achieved
by taking use of market forces that support this process.[13]
Forbes (Sep 7, 2022)
[4] Desirée Schmuck, Jörg Matthes & Brigitte Naderer, ‘Misleading Consumers with Green Advertising? An Affect-Reason-Involvement Account of
Greenwashing Effects in environmental Advertising ’ (2018) 47(2) Journal
of Advertising
[6] Lisa Smith, ‘8
Ways to Master
Green Marketing’ (Word Stream,
20 May, 2022)
[7] The Body Shop, ‘2021 Sustainability Report’
(2021)
[9] ICC Commission on Marketing and Advertising, ‘ICC Document No. 240-46/665’ (July,
2011)
[10] ‘Environmental
Claims Findings and Conclusions of the OECD Committee on Consumer Policy’
(2010) (DSTI/CP(2010)16/FINAL)
[11] International Labour Organisation, ‘Corporate Social Responsibility(CSR)’
November, 2022
[13] Chaudhary, Bhuvnender & Tripathi,
Saurabh & Monga,
Nikhil. (2011). GREEN MARKETING AND CSR. International Journal of Research in Finance and Marketing. 1. 82-99.
Article Information
CORPORATE AWARENESS AND GREEN MARKETING: AN ANALYSIS BY: PRAGYA RANI & SHOILY CHAKRABORTY
Authors: PRAGYA RANI, SHOILY CHAKRABORTY
- Journal IJLRA
- ISSN 2582-6433
- Published 2023/04/13
- Volume 2
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
- ISSN 2582-6433
- Access Open Access
- License CC 4.0
All research articles published in International Journal for Legal Research and Analysis are open access and available to read, download and share, subject to proper citation of the original work.
Disclaimer: The opinions expressed in this publication are those of the authors and do not necessarily reflect the views of International Journal for Legal Research and Analysis.