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Tuesday, November 30, 2010

"Goodwashing" and the Power of a Sustainable Supply Chain

Why companies should think inside the box.

I want to mention a suspicion I’m having about the CSR (Corporate Social Responsibility) wave we’ve been experiencing throughout the last decade. I’ve officially coined the un-witty term “goodwashing” as a parallel to the concept of “greenwashing”. For those of you who are new to the idea, our good friends at Wikipedia describe greenwashing as  the “deceptive use of green PR or green marketing in order to promote a misleading perception that a company's policies or products are environmentally friendly”. 

Goodwashing, then, is the same idea but goes beyond environmental sustainability to imply deceptive use of marketing to create a misleading consumer perception of a company’s socially responsible practices. Despite the huge annual increase in published CSR reports, I cannot help but suspect there remain consumer deception techniques that stay behind the boardroom doors. 

Where does this accusatory opinion come from might you ask?
Answer: Pure Speculation. 

HOWEVER, there is reason behind my speculation. I see tons of large companies making donations or supporting wonderful causes. I will go ahead and coin this term as “external CSR”, that is, chopping off a piece of the bottom line and sending it off to do some good. My concern is that companies are using these socially responsible activities to mask some serious ethical gaps in their own internal operations.

An example of how to build a sustainable supply chain
By simply analyzing a supply chain, I have no doubt large corporations will find opportunities to take out some of that external donation funding and put it towards free-trade products, manufacturing facilities in developing countries, more nutritious (and less processed) meats and packaged foods, safety enhancement….the examples are endless and vary widely across industries. 

If every company embedded socially responsible practices into their supply chains (“internal CSR”) instead of directing the funds to often unrelated causes (external CSR), I believe the overall social and environmental impact would be significantly higher. 

As for the not-for-profits that so badly rely on donations, I think companies should support these causes— as long as they are simultaneously working to perfect their own. Sustainable supply chains will decrease the number of charities aching for our donation dollars because they will inevitably eliminate many of the issues charities are trying to solve.

I should end by clarifying that I recognize that many companies are on the path of internal CSR, and they are an example to the remaining corporate giants. Further, I am a huge advocate of non-profits, and I happen to work for a great one; I simply feel that many companies aren’t investing their CSR dollars in an optimally impactful way. 

SO, I conclude that a coffee company which donates millions of dollars to youth-related causes should stop the goodwashing and start feeding some of those funds up their supply chain to support their coffee-bean farmers. Simply put: sustainable supply chains lead to sustainable economies.  

                                                                   Click here to see image source


  1. 100% agree with you, thanks for sharing .. keep up writing !

  2. Nice sharing dear auther my thinking is also same as you, well you can have a look into my work "Lean systems", which is all about lean products and Kaizen Training, I really appreciate your work you shared with us.