Most large companies guilty of 'greenhushing', report finds

While 63% of FTSE 100 companies were classed as “under-promoting” their ESG progress by not publicising all the factual data they disclosed on the topic last year, only two % were found to have “over-promoted”.

That’s according to the Transparency Index 2024, published by Connected Impact.

“In a climate of stringent regulatory scrutiny, where mistakes can result in fines and reputational damage, companies may be hesitant to promote their legitimate ESG credentials due to fears of greenwashing accusations,” the data insights company explained.

“This puts them at risk of ‘greenhushing’ – where organisations choose not to publicise details of their climate targets, or their plan to reach their targets, to avoid scrutiny and allegations of greenwashing.”

The annual Transparency Index report uses AI and proprietary content analysis of over 600,000 pieces of corporate comms output to measure the gap between baseline disclosures and communicated performance by FTSE 100 companies around non-financial issues.

It identifies the ‘transparency gaps’ between what businesses communicate on social media about ESG topics, and what they factually disclose about their targets and performance in annual reports, websites and other corporate documents.

According to this year’s findings, one-third (35%) of the FTSE 100 companies offered a ‘balanced’ picture to their audiences by having a minimal ESG transparency gap.

Lucy Walton, chief executive of Connected Impact, said: “Our data reveals that businesses are more likely to under-promote than over-promote their ESG initiatives. This cautious approach can deter investment and undermine credibility.

“We know most consumers favour responsible brands and transparent businesses. We know a well-governed, transparent business attracts more investment and top talent.

“This report equips businesses to identify – and close – transparency gaps so we can all make better decisions about where to invest our money, time and attention.”