Marketing & Communications

Greenwashing Is Following the Energy Transition

Greenwashing isn’t fading as capital moves into climate solutions; it’s following the money, and the next test of credibility will be whether companies can back their claims with evidence about biodiversity, water and communities as well as carbon.

By Antonio Vizcaya Abdo | Published 4 hours ago | About a 6 minute read

Image: Photo by Bernd Dittrich on Unsplash

For years, companies could draw a relatively simple line between the businesses contributing most to climate change and those helping to solve it. That distinction is becoming much harder to maintain.

Renewable energy, electric vehicles, critical minerals, transition finance and digital infrastructure are all essential to decarbonization. Yet being part of that shift does not automatically make an activity environmentally benign. A wind project can support clean power while affecting protected ecosystems. Mining the minerals needed for batteries can help electrify transport while placing additional pressure on water, land and local communities. Carbon projects can contribute to climate strategies while still raising questions about integrity or social impact.

As investment moves toward these activities, attention is moving with it.

RepRisk’s latest Greenwashing Report found that the number of greenwashing-related incidents increased by 112% between 2022 and 2026, while the number of companies linked to greenwashing reached 1,594 in 2026. More revealing, however, is how that exposure is changing. Alternative energy, mining, industrial metals, utilities and software and computer services are all taking a larger share of greenwashing-related concerns.

Greenwashing is not disappearing as capital shifts toward climate solutions. It is following the energy transition.

Being low carbon is not the same as being low impact

For much of the past decade, corporate environmental performance has been framed primarily through carbon. That focus made sense. Emissions remain at the center of climate strategy, and moving away from fossil fuels is essential. But as companies go deeper into implementation, a carbon lens alone can hide important trade-offs.

RepRisk’s data reflects that shift. For the first time in five years, ecosystems and biodiversity became the environmental issue most frequently linked to greenwashing risk, overtaking climate change and emissions. In alternative energy specifically, biodiversity and ecosystem-related concerns exceeded climate-related ones between 2022 and 2026.

This does not weaken the case for decarbonization. Rather, it shows why the next stage of the transition will require a broader understanding of impact. A project can genuinely reduce emissions and still create pressures elsewhere. Renewable infrastructure requires land. Batteries and grids depend on minerals. Industrial facilities use water. Large projects can reshape ecosystems and affect nearby communities.

The challenge, therefore, is no longer simply demonstrating that an activity contributes to lower emissions. Companies increasingly need to understand and explain the wider consequences surrounding it as well.

That makes broad labels such as “green,” “clean” or even “sustainable” much harder to use without qualification. The more ambitious the language, the more important it becomes to understand what sits behind it. A claim that focuses only on the positive climate contribution of an activity may still present an incomplete picture if material impacts elsewhere are left out.

Greenwashing is becoming an operational issue

This is also why treating greenwashing primarily as a communications problem is becoming less useful.

Marketing teams can change the wording of a campaign, and legal teams can review a statement before publication. But neither can solve a project whose risks were poorly assessed, an investment whose impacts were not fully understood, or a sustainability strategy built around assumptions that cannot be substantiated.

The issue becomes even more complicated when the company making the claim is not directly operating the underlying asset. Banks and financial-services companies together remain the largest combined grouping of companies linked to greenwashing in RepRisk’s 2026 data, with much of that exposure arising through the companies, assets and projects they finance, invest in or underwrite.

A financial institution can increase its allocation to transition finance and still face questions about the activities that capital supports. A company can purchase renewable energy while still needing to understand the land, biodiversity or community implications associated with a project. A technology company can position digital infrastructure as an enabler of decarbonization while facing growing attention around its own energy, water and resource demands.

In each case, the credibility of the final statement depends on decisions made much earlier. Procurement, investment approval, due diligence, supplier engagement, project design and governance all influence whether a sustainability claim can ultimately be defended.

That changes the role of communications. The task is no longer simply to find the right language for a sustainability initiative. It is to make sure the underlying business decision is strong enough to support the language in the first place.

Compliance and credibility are starting to diverge

At the same time, companies are operating in a regulatory environment that is becoming less uniform.

Some jurisdictions are tightening rules around environmental marketing and disclosure, while others are narrowing certain reporting or due-diligence requirements. RepRisk points to a growing distinction between what companies are formally required to disclose and what investors, regulators, customers or civil society may still expect them to substantiate.

That distinction could become increasingly important. A company may comply with a reporting requirement and still face criticism over an environmental statement. It may be required to disclose less in one area while facing more attention around what it chooses to say voluntarily. In that environment, reducing disclosure obligations does not necessarily reduce reputational or business-conduct exposure.

The data also suggests that the consequences are becoming more serious. Nearly one in four greenwashing incidents now involves severe allegations, compared with roughly one in six in 2022. Repeat exposure is also becoming more common, with three quarters of greenwashing incidents in 2026 involving a company that had already been linked to greenwashing in previous years.

Together, these trends point toward a different standard of sustainability credibility. Companies will increasingly need to trace their statements back to evidence, understand the trade-offs behind the activities they are supporting and communicate those trade-offs without pretending they do not exist.

The energy transition does not need fewer environmental claims. It needs better ones.

Companies can begin with three practical steps. First, build due diligence around both the intended climate benefits and material impacts on water, biodiversity and communities, documenting the evidence, assumptions and unresolved trade-offs. Second, require each environmental claim to have a supporting record that identifies its scope, source, limitations and the person responsible for keeping it current. Third, involve the teams responsible for the underlying project or investment in claim approval, alongside communications and legal, and reassess the wording when conditions or evidence change. This gives companies a clearer basis for deciding what they can credibly say and what still requires further work.

As investment continues moving into renewable power, minerals, infrastructure, technology and transition finance, the companies involved will face a broader set of expectations about what sustainability actually means. Being part of the climate solution will remain important, but it will no longer be enough, on its own, to prove that a project, product or business model is sustainable.