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Navigating silent approval of controversial topics?

Political quietness may appear as an effective countermeasure against political clamor

Possibility of silence on environmental matters approaching?
Possibility of silence on environmental matters approaching?

In the ongoing battle against climate change, the commitment of companies and financial institutions to sustainable practices has been a subject of both hope and scrutiny. A recent trend, known as "greenwashing," has raised concerns as some companies have been found to initially adopt green marketing or sustainability claims, only to retreat or obscure their commitments amidst political backlash.

This pattern is not a new phenomenon, with industries such as oil, coal, automotive, and finance being prime examples. In the 1980s, Chevron launched one of the earliest greenwashing ad campaigns, appealing to environmentally conscious audiences despite ongoing polluting activities. More recently, Volkswagen's 2015 emissions scandal revealed that their “clean diesel” claims were false, and banks like HSBC and investment firms have been fined for greenwashing by falsely claiming fossil fuel divestment or sustainable investment products.

The consequences of greenwashing extend beyond individual companies. When companies backtrack on their commitments or are revealed to have misled the public and policymakers, it undermines trust in private sector participation in climate action, weakening public-private climate alliances. A notable example is the Net Zero Insurance Alliance (NZIA), launched in 2021, which fell apart in 2024 due to an anti-ESG backlash disguised as antitrust complaints.

The erosion of trust and credibility has prompted governments and international bodies to impose more rigorous transparency and reporting demands. These measures aim to curb false climate claims and hold companies accountable for inconsistent “green” postures. The UK's Green Claims Code (2021) and anti-greenwashing rules introduced by financial authorities in 2024 are examples of such frameworks.

Despite these challenges, the commitment to climate solutions remains strong among many companies. The world's largest asset owners, such as Dutch pension fund ABP, plan to deploy significant capital in climate solutions over the next few years. ABP, one of the world's largest, plans to deploy €30bn in 'impact investments' by 2030, with €10bn of that in climate solutions.

Alliances have played a vital role in disseminating target setting protocols, research methodologies, and exerting public pressure on members to reduce their fossil fuel financing. The battle against climate change outside a portfolio becomes harder to fight without collective action through alliances. Silence in the context of climate alliances comes with a cost, as climate change is a collective action problem and collective action through alliances goes a long way in reducing fossil fuel financing.

As we move forward, it remains to be seen whether the odds are still collectively in favor of managers and banks silently and individually fighting the battle against climate change. Whether companies will continue to engage in greenwashing practices or commit to genuine, measurable emissions reductions will shape the evolving governance landscape of climate alliances.

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  1. The financial sector, which has been under scrutiny for its role in greenwashing, will need to demonstrate genuine commitment to climate-change mitigation in order to rebuild trust and maintain its position in environmental-science alliances.
  2. In the wake of greenwashing scandals, it is essential for companies to abandon deceptive practices and instead focus on viable and measurable strategies to reduce their carbon footprint in the industry.
  3. As the battle against climate change evolves, the success of business-led environmental alliances will hinge on their ability to hold members accountable for their green claims, and to discourage greenwashing through stricter reporting and transparency requirements.

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