Greenwashing
ES EN
« "Tractor Supply's Shift Away from DEI Programs …
"Unmasking Deception: Navigating the Complex …  »

"How to Spot and Avoid Misleading Eco-Friendly Claims in Investments and Purchases"

Published: 2024-06-30

Understanding Greenwashing: What You Need to Know

In today’s fast-changing world of money, “greenwashing” is a big worry for both investors and shoppers. Companies sometimes lie or stretch the truth about how eco-friendly they are. They do this to seem more sustainable than they really are. Knowing how greenwashing works and spotting its effects can help people make smarter choices.

How Companies Greenwash

Companies use different tricks to greenwash. They might use fake labels, unclear claims, or only share part of the truth to look green. For example, a company might talk a lot about one green project but ignore its bigger, harmful actions. Another trick is using fancy words or certificates that sound good but aren’t strict.

Examples of Greenwashing

  1. BlackRock’s ESG Capital Allocation Term Trust (ECAT):

    • This Trust had a 62% drop in short interest, and its stock price went up to $17.54.
    • Big investor Saba Capital Management, L.P. bought more shares, and other big investors changed their holdings.
    • This might look good, but it’s important to look deeper. Investors should watch out for greenwashing that hides the true eco-friendliness of these investments.

  2. Lloyds Open Form (LOF) 2024:

    • This rebranded form wants to be more open and include ESG reporting in rescue operations.
    • Groups like Gard and international maritime organizations support this change, but some still have doubts.
    • Fewer big accidents are good, but worries about less rescue resources and true ESG commitment remain. Working together is key to avoid fake ESG claims.

  3. Vanguard’s ESG U.S. Corporate Bond ETF (VCEB):

    • This ETF announced a dividend of 0.2295 per share, with its price dropping to $62.06.
    • It focuses on US corporate bonds with ESG criteria, based on a special index.
    • Even though Vanguard is well-known, investors should check if the bonds really meet the promised green standards.

  4. VictoryShares Core Plus Intermediate Bond ETF (UBND):

    • This ETF saw an 80.6% rise in short interest, with its stock at $21.40.
    • It invests in bonds with good ESG traits.
    • The rise in short interest might show doubt from investors, so the ETF’s true ESG commitment should be watched closely.

  5. Kuwait Finance House (KFH):

    • KFH is now part of the FTSE4Good Index Series for its strong ESG practices.
    • Its green finance, eco-friendly actions, and responsible banking are praiseworthy.
    • But it’s important to ensure these actions are real and not just a show to attract green-minded investors. Real work with the United Nations and following Sustainable Development Goals (SDGs) are good signs, but constant checking is needed.

Why Greenwashing Matters

Greenwashing tricks the public, making people think they are supporting green actions. This can break trust and make it hard for truly green companies to stand out. For example, the rise of globalism and “philanthrocapitalism” shows a move towards working together. The term “philanthropath” describes someone pretending to be a do-gooder but isn’t, showing the risk of fraud. Investors should be careful to ensure their money goes to real green efforts.

Climate Lawsuits

Lawsuits against governments and companies for climate issues are growing. These cases challenge lies and false climate claims, aiming to make companies accountable for their environmental harm. But some lawsuits try to block real climate action, making the ESG world even more complex.

Staying Informed

People should know about greenwashing because it affects how they invest and shop. By staying alert and informed, they can make choices that truly help the environment, avoiding lies and fraud.

https://www.themarketsdaily.com/2024/06/30/blackrock-esg-capital-allocation-term-trust-nyseecat-short-interest-update.html

Related news on 2024-06-30

« "Tractor Supply's Shift Away from DEI Programs …
"Unmasking Deception: Navigating the Complex …  »