Greenwashing: What It Is, How to Spot It, and How to Avoid It

What distinguishes a genuine sustainability strategy from greenwashing? What risks do companies face when using vague environmental claims? And above all: how do you build environmental communication that is credible, verifiable and compliant with the new European regulations? In this article we have tried to answer these questions, citing examples, strategies for identifying greenwashing and operational guidelines for communicating sustainability to end consumers without incurring penalties. Because from September 2026, getting it wrong can cost up to 4% of turnover.

What is greenwashing and what does it mean

The term greenwashing indicates the practice of presenting products, services or business activities as eco-sustainable when they are not, or only partially so. It is a form of misleading communication that exploits the growing demand for low-impact products: instead of investing in real transformation, some companies simply build a “green” image without substance.
The term was coined in the 1980s by environmentalist Jay Westerveld, and since then confirmed and sanctioned cases have multiplied worldwide, including in Italy. Today the phenomenon is not limited to traditional marketing: it manifests itself on labels, websites, sustainability reports and corporate ESG strategies, often without companies even realising it.

How greenwashing manifests itself: the most common techniques

Greenwashing is not always a deliberate act. Many companies fall into it by using language that is more “creative” than accurate. The most common techniques, now codified by EU regulations, include:

• Vagueness: claiming environmental benefits without providing concrete evidence, measurable data or reliable certifications. A typical example: “eco-friendly product”, without explaining what the benefit actually consists of.
• The part for the whole: emphasising a single ecological aspect while ignoring the overall impact. Example: a garment labelled “green” because 5% of its materials are recycled.
• Offset abuse: declaring a product “carbon neutral” by purchasing carbon credits alone, without reducing actual emissions at source.
• Tailor-made certification: using labels or logos invented by the company itself, without any verification by independent third parties.
• Stating the obvious: presenting as an environmental achievement something that is already legally required (e.g. “CFC-free”).
• Aspirational sustainability: communicating vague or unachievable future goals as if they were already reality, shifting attention away from the product’s current environmental impact.

Recognising these practices is the first step to avoiding them, both as a company and as a consumer.

Concrete risks for companies: penalties, reputation and ESG compliance

The risks associated with greenwashing are real and growing fast. On the legal front, the Italian Competition Authority (AGCM) is already sanctioning companies under existing misleading advertising rules. A recent and significant case: in August 2025 Shein was fined one million euros for environmental messaging the authority described as “vague, generic and in some cases misleading”, including emissions reduction commitments contradicted by the company’s actual data.
With the new European regulations fully in force from 27 September 2026, penalties can reach up to 10 million euros and, in cases of cross-border infringements, up to 4% of annual turnover. But beyond legal consequences, an exposed greenwashing case produces reputational damage that is difficult to quantify: consumers and investors are increasingly informed and less tolerant.

On the ESG and financial front, companies exposed to greenwashing also risk compliance issues related to the EU Taxonomy and the CSRD, and lose credibility with institutional investors who integrate environmental, social and governance criteria into their decisions.

Which claims to use and which to avoid: practical guidelines

The question every marketing team should ask before publishing any environmental statement is simple: can this claim be substantiated with scientifically verifiable data from third parties? If the answer is no, it is better not to use it.
To avoid: terms such as “eco-friendly”, “green”, “sustainable”, “nature-friendly”, “zero impact”, “carbon neutral” if based solely on the purchase of credits, self-produced certifications, superlatives such as “the most ecological” or “perfect for the environment”.

To use: precise and specific statements, supported by recognised scientific methodologies such as LCA (Life Cycle Assessment), carbon footprint calculated according to ISO 14064 or the GHG Protocol, EPD environmental product declarations, or official certifications such as the EU Ecolabel, FSC, ISO 14001.

Every claim must be specific — meaning it must refer to that product in that particular aspect (not the category in general) — transparent, with information easily accessible to the customer and available on the same medium (e.g. a QR code) — and relevant: the declared benefit must be significant in the overall context. A product cannot be called “green” for a 1% water saving while doubling its use of plastic. For those using carbon markets, carbon offsetting is legitimate only as an additional contribution to a documented emissions reduction pathway, never as the sole basis for declaring a product climate neutral.

The EmpCo Directive 2024/825: what changes from September 2026

The European Union has finally included the environmental and social characteristics of products, services and organisations among the features that can be subject to misleading and deceptive communication. The EmpCo Directive (EU) 2024/825, transposed into Italian law with Legislative Decree 30/2026 and examined in detail in this article on the Empowering Consumers Directive, has been in force since 27 September 2026 and applies to all companies communicating with end consumers.
The regulation absolutely prohibits generic environmental claims without supporting evidence (“green product”, “ethical company”, “nature-friendly”), declarations of climate neutrality based exclusively on the purchase of carbon credits, self-produced sustainability labels, and the presentation of a product as entirely sustainable when only one component qualifies. It is also prohibited to present as an environmental achievement something that the law already requires of all competitors.

Future commitments — such as “we will be carbon neutral by 2030” — remain permitted, but constitute a formal obligation: they must be accompanied by a plan with measurable targets, precise deadlines and periodic verification by independent third parties. The EU Taxonomy remains the scientific reference for assessing whether an activity is truly sustainable in relation to the six environmental objectives established by the Union. Find out more about building responsible climate strategies in line with this regulatory framework.

How to build a credible environmental project: the Etifor method

Avoiding greenwashing does not mean giving up on communicating sustainability. It means doing so with real data. Etifor’s approach is based on the MARC hierarchy: first measure emissions and impacts, then reduce them in a documented way, then communicate what has been done, citing separately any external climate contributions such as forestry projects.
Every credible environmental project must include a reference baseline, a theory of change, a monitoring plan and a reporting plan. Impacts must be real, measurable, verifiable and additional. Methodologies must be scientifically grounded, comprehensive and transparent.

A concrete case: NextEnergy Group, a company in the renewable energy sector, developed with Etifor a Nature Strategy grounded in science, demonstrating real impacts on nature with explicit spatial data and verifiable targets. In the production supply chain sector, Etifor supports companies in developing verified positive-impact forestry supply chains and net-zero climate strategies based on certified data and independent verification. For those including carbon credits in their strategy, the Italian forestry carbon credit registry guarantees the quality and traceability standards now required by regulations.

The principle is one: stop communicating the intention and start communicating the data.