SDGwashing: a critical view of the pursuit of SDGs and its relationship with environmental performance

Abstract

The sustainable development goals (SDGs) provide a strategic vision and future-oriented plan that companies, regulators and society in general are challenged to face. However, companies’ contribution to the achievement of SDGs is questioned by some critical voices. In the business context, SDGwashing refers to positively pursuing a contribution to some SDGs while ignoring the negative impact of others. The objective of this research is to study whether there is an association between pursuing SDGs of a different nature and environmental performance. Are companies pursuing the more environmental-focused SDGs, the ones with better environmental performance, compared to companies pursuing more social-focused SDGs? Thus, this work examines whether multinationals that pursue more environmental-focused SDGs have a similar level of environmental performance to those that make efforts to pursue more social-oriented SDGs. This study analyzes whether SDGwashing exists in relation to environmental performance by studying its relationship with two relevant variables of literature on environmental management: outcome-based environmental performance (through GHG emissions) and process-based environmental performance (through CDP scoring). Using a sample of multinational firms listed on the FTSE 100 index, we applied an ANOVA test and logistic regression to show whether the pursuit of both more environmental-focused SDG and more social-focused SDGs was associated with environmental performance. The results of this study offer a significant contribution to academic literature on SDGs. Our findings show that the organizational profile of multinational companies that pursue more environmental-focused SDGs differs from the organizational profile of multinationals that are pursuing more social-oriented SDGs, in terms of environmental performance. This offers empirical evidence by showing that SDGwashing exists in international business.

Keywords:

• SDGwashing
• international business
• environmental performance
• GHG emissions
• Carbon Disclosure Project Scoring
• Global Reporting Initiative
• logistic regression

Supplemental data

Supplemental data for this article is available online at https://doi.org/10.1080/09640568.2022.2033960.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1 According to the Merriam Webster Dictionary, the term “pursue” has three essential meanings: (1) to follow and try to catch or capture (someone or something) for usually a long distance or time; (2) to try to get or do (something) over a period of time; (3) to be involved in (an activity). Thanks to the suggestion of two anonymous referees, we opted for using the term “pursue the achievement of SDG” since it reflects that companies are attempting to achieve SDGs, but it does not necessarily imply that they are going to do so.

2 The median of this variable, for the FTSE 100 sample, is to comply with four indicators related to SDG#6.

3 The following gases are relevant: carbon dioxide (CO₂), methane (CH₄), nitrous oxide (N₂O), hydrofluorocarbons (HFCS), perfluorinated compound (PFCS), sulfur hexafluoride (SF₆), nitrogen trifluoride (NF₃)

4 The current version of GRI, called GRI Standards, was released in 2018 and is currently valid; meanwhile the previous version, called GRI G4, was published in 2013 and was valid until 30 June 2018.

5 Note that for unbalanced models where the homoscedasticity hypothesis does not hold, it is convenient to use Welch’s ANOVA (McDonald 2014).

Additional information

Funding

This work has been partially supported by the following programs: research project funded by ERDF Funds and the Council of Economy, Knowledge, Business and University (Junta de Andalucia, CV20-20664), research project funded by National R&D Plan of Ministry of Economy and Competitiveness (National Government of Spain, ECO2017-88222-P); Grants for the cost of revising academic texts funded by Economics and Business School of University of Granada (2022 Edition).