All Bark No Bite: India’s Battle with Greenwashing

As sustainability becomes a key focus in corporate strategy, companies are increasingly making environmental claims to appeal to eco-conscious consumers. However, some of these claims can be misleading—a practice known as greenwashing. While global regulators are tightening their grip on deceptive sustainability marketing, India’s response is still evolving. The existing legal framework includes provisions to address greenwashing, but enforcement remains inconsistent, and the penalties may not always be sufficient to deter larger corporations. This raises an important question: Are India’s current laws adequately equipped to tackle greenwashing, or is there a need for a more comprehensive regulatory framework? 

READ MORE: "What Is Greenwashing? Top Examples You Need To Know" 

The Deceptive Facade of Greenwashing

Greenwashing occurs when businesses misrepresent their environmental initiatives, either by exaggerating their impact or concealing their overall harm. A common tactic is promoting a single green initiative while ignoring the broader environmental footprint. For example, a company might advertise a “100% biodegradable” product while relying on unsustainable supply chains or excessive plastic packaging. Others claim “carbon neutrality” without tangible emission reductions, relying instead on questionable offset programs. These tactics not only mislead consumers but also distort market competition, allowing unsustainable businesses to profit at the expense of genuinely responsible firms.

The contemporary relevance of Greenwashing

Internationally, greenwashing scandals have damaged the credibility of corporate ESG commitments. H&M’s “Conscious Collection” faced a lawsuit in the US for misleading consumers about its sustainability claims, while Volkswagen’s infamous Dieselgate scandal exposed the company’s fraudulent emissions data. Many FMCG and fashion brands have been criticised for using unverified eco-labels, marketing their products as “biodegradable” or “natural” without scientific backing. Beverage companies frequently claim their plastic packaging is “100% recyclable,” yet only a fraction of it ever enters the recycling system. These instances underscore a glaring regulatory gap—while companies are free to make sustainability claims, there is little oversight ensuring these claims are genuine. 

ALSO READ: What Are The Main Greenwashing Tactics Companies Use?

The Legal Framework: Gaps in India's Response

On paper, India has several laws that could be used to address greenwashing. The Securities and Exchange Board of India (SEBI) has introduced Business Responsibility & Sustainability Reporting (BRSR) Core, requiring listed companies to disclose verifiable ESG data. While this represents progress, its effectiveness hinges on strict enforcement, something India has struggled with.

SEBI’s Business Responsibility and Sustainability Reporting (BRSR)

Introduced in 2021, SEBI's BRSR framework mandates the top 1,000 listed companies to disclose detailed ESG information. In 2023, SEBI launched BRSR Core, introducing nine key ESG attributes to strengthen corporate accountability. The framework requires companies to provide verifiable data on their sustainability claims, promoting transparency. In January 2025, SEBI relaxed the timeline for ESG rating reviews, allowing ESG Rating Providers (ERPs) up to 45 days to review ratings after the BRSR publication.

RBI’s Climate Finance Disclosure Requirements

Following SEBI’s lead, the Reserve Bank of India (RBI) introduced draft climate finance disclosure requirements for financial institutions. These aim to integrate climate-related risks into financial reporting, promoting greater transparency and accountability in ESG practices.

Greenwashing Guidelines (November 2024)

In a significant step, the Central Consumer Protection Authority (CCPA) introduced Greenwashing Guidelines under the Consumer Protection Act, 2019. These guidelines include:

• Verifiable Data: Companies must back their sustainability claims with concrete data.

• Clarity and Accessibility: ESG disclosures must be clear and easy to understand.

• Third-Party Validation: Independent verification is encouraged for added credibility.

• Prohibition of Overstatement: Companies cannot exaggerate their sustainability achievements.

A Deeper Issue: The Power of Consumer Perception

Regulatory shortcomings are not the sole issue—consumer perception plays a crucial role in enabling greenwashing. In India, sustainability remains a secondary concern for many consumers, who prioritise affordability and convenience over environmental impact. This lack of consumer-driven pressure allows companies to continue greenwashing without major consequences. Unlike in Western markets, where investor activism and public scrutiny push businesses toward genuine ESG commitments, Indian corporations face little reputational risk for misleading environmental claims. This, in turn, reduces incentives for companies to adopt transparent sustainability practices.

The Need for Systemic Change

Addressing greenwashing requires more than just tighter regulations—it demands a paradigm shift in how sustainability is monitored and communicated. Strengthening BRSR Core with hefty penalties for false ESG claims is a necessary step, but independent third-party ESG audits could provide a more effective verification mechanism because trust is the cornerstone of credible ESG reporting. Without independent verification, sustainability claims lack the rigor and reliability necessary to gain stakeholder confidence. Just as financial statements are deemed trustworthy only after thorough audits, ESG reports should be held to the same standard. As the saying goes: proof beats promises companies that proactively adopt third-party ESG audits will not only mitigate the risk of greenwashing accusations but also build greater credibility and investor trust. India must also look toward global best practices, such as the EU’s Green Claims Directive, which mandates companies to provide scientific evidence for their sustainability claims before advertising them.

Beyond legal reforms, consumer education must be a priority. If consumers are equipped with the knowledge to critically assess green claims, they can act as a natural check against deceptive corporate practices. Civil society organizations, media, and advocacy groups must step in to raise awareness, fostering an environment where companies feel compelled to embrace genuine sustainability rather than superficial green marketing.

Conclusion

India is at a crossroads in its approach to greenwashing. While regulatory efforts like SEBI’s BRSR Core signal progress, the lack of stringent enforcement, standardised reporting, and consumer awareness continues to enable deceptive sustainability claims. The challenge lies not just in creating new laws but in ensuring meaningful enforcement and public accountability. To truly combat greenwashing, India must adopt a more transparent, consumer-driven, and strictly regulated ESG landscape, where sustainability is not just a marketing tool but a verifiable corporate commitment.