Companies like Microsoft and Lidl are achieving profits in the Sustainability Gap Index, while Tesla risks potential setbacks.

Surprising research shows that brands like Microsoft, which perform better in terms of sustainability than they are perceived, miss financial opportunities by not adequately communicating their 'green' efforts. A phenomenon known as 'green-hushing', or remaining silent about your sustainability goals and actions, can be just as damaging to a brand as 'greenwashing'.

The Sustainability Gap Index, created by Brand Finance, quantifies the value that brands can gain or lose through their sustainability efforts. Microsoft leads the Index with a net value of $1.5 billion, indicating that the brand could generate that amount if it communicated its sustainability measures more effectively. Other brands with a positive gap value include Walmart (2nd), Pepsi (7th), and Lidl (10th).

However, Tesla ranks at the bottom of the list. The perception of Tesla's environmental sustainability accounts for more than a quarter of its brand value (26.9%), but its poor performance in governance and social sustainability means that over $4 billion in value is at risk if the public scrutinizes these performance shortcomings more closely.

Surprisingly, Amazon has the highest sustainability perception of any brand at $19.9 billion. However, this research is not an assessment of the brand's overall performance; it indicates how the public perceives the brand as committed to sustainability efforts.

The report also states that sustainability efforts are a valuable factor in driving consideration across various sectors, using what Brand Finance calls a 'Sustainability Driver Score'. The sector where sustainability is most important is luxury cars, with a sustainability driver score of 22.9%. Other sectors with a high sustainability factor include soft drinks (13.7%), supermarkets (12.6%), media (10.1%), and cosmetics (10%).

Despite their sustainability efforts, Microsoft is accused of never having positioned sustainability as part of its brand identity, which allows for growth in this area. If they were to do so, thanks to the investments they have already made and the value it has already brought to the company, Microsoft would not be accused of greenwashing, the report states. In fact, it might currently be more a case of 'green-hushing'.

For Sasan Saeidi, global president and chairman of the IAA, the fear of being accused of greenwashing is a reason some brands withdraw. He states that trends like 'greenwashing' and 'green-hushing' have indeed emerged. He explains that 'green-hushing' occurs when brands and companies avoid discussing sustainability goals or progress out of fear of accusations of greenwashing.

Herve de Clerck, vice president of IAA Global, shares this view and says that "greenwashing is a double-edged sword." While brands may initially attract environmentally conscious customers, this can lead to a lack of trust in the brand in the long term and harm the efforts of genuinely sustainable companies. "The negative consequences of greenwashing affect not only consumers but all companies in the green market, whether they engage in greenwashing or not," says de Clerck.

These values highlight that it is crucial to truly put words into action when considering corporate investments. They emphasize the example of Microsoft, which has heavily invested by committing to being carbon neutral, water positive, and zero waste by 2030. This is alongside the launch of Microsoft Cloud for Sustainability, which enables other companies to improve their operational and cost efficiency to help them achieve their sustainability goals.

[@portabletext/react] Unknown block type "span", specify a component for it in the `components.types` prop