The new RepRisk report on corporate greenwashing was expanded this year to include “social washing.” According to RepRisk, “social washing takes place when companies paint themselves in a positive light by obscuring an underlying social issue in an attempt to safeguard reputation and financial performance” and is defined as “as a contradiction between a positive image and an underlying social issue, such as Human rights abuses and corporate complicity, Child labor, or Impacts on communities, captured by the overlap of Misleading communication and social issues.”
Examples of social washing topics identified by RepRisk include:
- Human rights abuses
- Forced and child labor
- Poor employment conditions
- Occupational safety and health
- Freedom of association and collective bargaining
- Discrimination – social and in employment
- Impacts on communities and local participation issues
Certain topics were found to be associated with specific industries:
“Social washing around Human rights abuses and corporate complicity can be seen in the Software and Computer Services sector where risk incidents are linked to Privacy violations and Supply chain issues. Masking of human rights issues also takes place in the Travel and Leisure sector around instances of discrimination and negligence. Another employee relations issue, Poor employment conditions, is critical in the Retail and Food and Beverage industries, around topics such as Supply chain issues, Migrant labor, and Salaries and Benefits.”
Interestingly, the report stated that “social issues are, more often than not, inextricable from environmental ones” and “companies involved in greenwashing seem to be more inclined to utilize social washing strategies.”
These findings harken back to the days of CSR (corporate social responsibility) – which was only a few years ago, but may have been forgotten in the current ESG wave.
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