Recognising and avoiding greenwashing in STRs

When environmental consciousness is at its peak, short-term rental businesses face a challenge in balancing sustainability with integrity. The temptation for businesses to engage in ‘greenwashing’ has increased as travellers seek eco-friendly accommodations. But what exactly counts as greenwashing, and how severely does it impact the vacation rental industry? By understanding the essentials discussed in this article, STR owners and managers can avoid this sustainability trap. Let’s go.

What is greenwashing?

Greenwashing is a term used when a business claims its products or services are more environmentally friendly than they really are.

This can be misleading for consumers who are trying to make eco-friendly choices.

For short-term rental hosts and managers, greenwashing might look like this:

Emissions offsetting claims: Saying your STR’s emissions offsetting schemes have a reduced or positive impact on the environment.

Vague or non-specific claims: For instance, advertising your property as ‘built with sustainable practices’ but providing no clear details on what these practices are. These might include solar panels, EV chargers, or heat exchange pumps installed at the property. Without the detail this leaves the statement open-ended and potentially misleading.

Misleading labels

Using terms like ‘green stay’ or ‘eco-friendly property’ for your STR without clear evidence or a third-party certification to back up these claims is deceptive. For example, labelling a property as ‘eco-friendly’ just because it has a garden or a few potted plants.

Overstating minor improvements

Making a small change, like using energy-efficient light bulbs, and advertising it as a major environmental initiative, that’s greenwashing. It’s misleading to imply that such a change has a more significant impact than it really does.

Focusing on minor aspects to distract from bigger issues

For example, you might promote the use of organic bed linens, but if the property has a large carbon footprint due to other practices like excessive water usage or non-energy efficient appliances, you might be accused of greenwashing.

Irrelevant claims

Stating that your STR avoids illegal or non-standard practices like animal abuse (which should be a given), and publicising it as your main environmental initiative, is greenwashing. Businesses often engage in greenwashing primarily to appeal to the increasing consumer demand for eco-friendly products and travel. By creating a false impression of being environmentally conscious, they suggest their operations are more natural, healthier, and less wasteful. All despite not making significant sustainable changes. This tactic is also used to attract investors, especially with the rise of environmental, social, and governance (ESG) investing. As nicely captured in the words of KoAnn Vikoren Skrzyniarz, Founder and CEO of Sustainable Brands:

“Greenwashing is a short-sighted strategy that may boost sales temporarily, but in the long run, it damages a company’s reputation and the credibility of the entire sustainability movement.”

How serious is greenwashing?

For short-term rental owners and managers, understanding the implications of greenwashing is essential. Claiming properties to be eco-friendly without validation can damage brand trust and invite legal issues. Greenwashing began in the 1960s when hoteliers encouraged guests to reuse towels to save money on laundry, not for environmental concerns.

Several high-profile cases faced the consequences of greenwashing last year, as the UK’s Advertising Standards Authority banned their ads:

HSBC

Their advertisement claimed they were helping clients transition to a net-zero carbon future. However, they didn’t disclose they were still funding oil and gas companies, leading to their ad being banned for being misleading.

Lufthansa

Lufthansa’s #MakeChangeFly campaign featured the slogan ‘Connecting the World. Protecting its Future.’ However, this campaign faced restrictions in the UK because no environmentally friendly initiatives or commercially viable technologies in aviation support Lufthansa’s absolute green claims.

Etihad Airways

Etihad faced a ban on their Facebook ads for overstating the environmental benefits of their flights. The ads suggested significant advancements in sustainable aviation but lacked the necessary evidence to support these claims.

Unilever’s Persil

The detergent brand claimed in their ad to be ‘kinder to our planet.’ This claim was challenged due to a lack of a clear basis for comparison and not considering the entire lifecycle impact of the product.

Evergreens’ Artificial Grass

Evergreens advertised their plastic grass as ‘eco-friendly’ and compared its benefits to ‘the air-purifying effects of one mature tree.’ This claim was found to be misleading and vague.

A potential greenwashing case in the hospitality industry can be found at New Haven’s Hotel Marcel. In its business operations, the hotel claimed net-zero carbon emissions, but it did not take into account the embodied carbon. Such carbon emissions are associated with building materials, transportation, installation, maintenance, and disposal. A selective approach to operational sustainability, rather than one that takes a holistic approach, can be misleading while making broader claims.

The European Commission’s study in 2020 showed that greenwashing is a widespread problem. They found that over half (53.3%) of the 150 environmental claims they looked at were vague, misleading, or had no basis. Also, 40% of these claims didn’t have enough proof. The study also noted more than 230 different ‘green’ labels in the EU, but these labels varied greatly in their transparency and reliability.