by Andrea Malcolm
Speaking at an ESG summit held by the Australian Financial Review, ASIC Chair Joe Longo said as a response to ASIC’s scrutiny of greenwashing, some companies may be tempted to cease all voluntary disclosure, “chasing greenwashing with a little ‘greenhushing’.”
This follows ASIC’s recent report which outlined 35 interventions it has taken on greenwashing in the past nine months, including civil proceedings against Mercer Superannuation Australia and fines for Vanguard.
Longo said ASIC has observed some commentators and firms saying, in effect, that while they have a good ESG policy, they can’t say anything about it because the regulators won’t let them.
He also referred to a 2022 international report by Swiss carbon finance consultancy, South Pole, that found nearly a quarter of 1,200 companies surveyed had decided not to talk about their net-zero commitments at all.
The report stated, “Many businesses with robust targets are going green and then going dark, potentially giving rise to an emerging practice: ‘green-hushing’.
“Not publisicing progress makes corporate climate targets harder to scrutinise and limits knowledge-sharing on decarbonisation, potentially leading to less ambitious targets being set, and missed opportunities for industries to collaborate.
“To achieve true climate impact, we need a future in which society has the ambition and ability – but also the confidence – to address climate change on the scale that is required. This is impossible if progress happens in silence.”
Longo said the “critics are right. This kind of response is just another form of greenwashing; an attempt to garner a ‘green halo’ effect without having to do the work.”
In New Zealand the issue of greenhushing was raised recently at the launch of the 2023 consumer survey on investment by Mindful Money/Responsible Investment Association of Australasia.
RIAA New Zealand general manager Dean Hegarty said some funds in the Australian market are pulling back on ESG claims. “A lot of organisations are doing due diligence on claims including historical.
“We have to focus on what the labels are, what they mean and how they work. It’s something we have to work through.”
Pathfinder CEO John Berry said greenwashing is a sign of an immature market. “Marketing has run away from what investment teams are doing. Greenhushing is probably a response from a more mature market. People are being challenged overseas and we have had companies pinged and made an example of. We need better standards. That is happening in the EU but not in New Zealand, meaning people are more reluctant to talk about it.”
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