2023 has been an important year for the UK’s sustainable finance sector. The government finally unveiled its comprehensive Green Finance Strategy, while London secured its position as the world’s leading centre for green finance.
But despite the advancements, banks operating in the UK face a significant PR challenge.
The ESG reputational pain point
Our analysis of 574 articles published in UK media since the start of the year indicated that greenwashing is the dominant topic in UK media discussions on green finance.
Greenwashing has been part of the ESG debate ever since Commetric started analysing the conversation, even before ESG was such a buzzword. Over the last couple of years, greenwashing has kept us busy, as we’ve utilised a blend of human-led analysis and leading AI tech to help clients from various industries re-jig their green comms strategies.
Our latest data shows that greenwashing has now escalated to become the foremost challenge for PR and comms professionals in finance, permeating every facet of their work.
This year, the UK media has had a particular focus on this topic, as it emerged that instances of greenwashing have become a systemic problem among UK banks and the UK Financial Conduct Authority proposed new rules to tackle the problem. Moreover, the reputational risk has been intensified by recent surveys showing that a substantial portion of UK consumers would change their banking provider over sustainability failings.
How financial institutions can take control of the ESG narrative
Our media analytics case study indicates that PR and comms professionals in financial institutions are often inadequately equipped to handle greenwashing accusations effectively. Common tactics involve reiterating ESG commitments or engaging in debates over the definitions of terms like “ESG investment” and “green finance.” These semantic strategies, aimed at justifying firms’ decisions, tend to exacerbate negative media coverage rather than mitigate it.
Here are 3 ways Commetric’s strategic media analytics can help PR and comms in finance:
1. Deep-dive into the specific issues driving greenwashing allegations
Commetric’s advanced thematic and message analysis transcends typical surface-level scrutiny, offering granular insights into the specific issues that trigger allegations of greenwashing and the ways they tend to grab headlines. These insights allow PR and comms to identify the key concerns and narratives shaping public discourse around sustainable finance, enabling them to craft targeted communications strategies that address these issues directly and anticipate potential areas of criticism, instead of issuing blanket statements, as many finance brands tend to do.
For instance, our analysis found that the primary drivers of greenwashing allegations in the UK media have been fossil fuel financing, superficial climate pledges and a lack of transparency:
The issue of fossil fuel financing has been especially prominent, as many UK outlets noted that despite the noble aims of the Glasgow Financial Alliance for Net Zero (GFANZ), established at Cop26, their members – including Barclays, Citi, JP Morgan and HSBC – have been found to pour billions into fossil fuel expansion.
Of the aforementioned banks, HSBC became the most prominent one due to significant media coverage of protests at their annual general meeting, where climate campaigners accused the bank of climate change ‘lies’ and unfair policies. These protests, highlighted by dramatic actions like Extinction Rebellion activists covering themselves in green slime, brought intense scrutiny to HSBC‘s environmental pledges.
2. Coverage driver analysis of specific green solutions
The media landscape around ESG is saturated with climate pledges by financial institutions, and their sheer volume has become one of the main catalysts for greenwashing accusations, as they are perceived to be mere public relations manoeuvres.
Our analysis suggests that PR and comms pros should instead pivot towards promoting specific green financial instruments, as they are often framed by media outlets as a more concrete way for institutions to demonstrate commitment to sustainability. Media analytics can play a crucial role here by analysing which green financial instruments are trending in media discussions, how they are portrayed, and their impact on the reputations of financial institutions.
For example, a notable portion of the ESG debate focused on products like Green Savings Bonds or Green Loans, as they are often framed as providing clearer, more measurable outcomes of ESG strategies.
In our media sample, NS&I provided a compelling case study of how specific financial products can generate positive media attention – the bank’s February launch of new Green Savings Bonds linked to government-backed green projects was portrayed as showing that consumer savings can help the environment. Moreover, the then-CEO Ian Ackerley emerged as the most influential spokesperson in the debate:
Ackerley was widely quoted as saying that Green Savings Bonds are an excellent new opportunity for savers who want to grow their funds while knowing that their investment will make a difference by helping finance the Government’s green projects.
3. White space mapping
By using white space mapping in the ESG narrative, finance brands can effectively counter greenwashing accusations. Commetric excels in this area through its unique combination of cutting-edge AI technology and seasoned human analysis. Our approach differentiates itself by not just identifying underrepresented topics but also by analysing the interconnections and evolving trends within these areas.
We provide a deeper, more dynamic understanding of the ESG media landscape, revealing opportunities for thought leadership and genuine engagement in spaces that are often overlooked or insufficiently explored. This comprehensive and nuanced analysis allows our clients to strategically position themselves in the forefront of ESG discussions, demonstrating a commitment to all facets of sustainability that goes beyond the standard environmental focus.
For example, our analysis found that the social dimension of sustainable finance is ripe for development, akin to the environmental component’s evolution. In financial services, while climate-related financial risks have been incorporated into balance sheets and financial disclosures, the social factors have not yet gained similar traction.
There’s an interesting takeaway from our previous studies of the broader sustainability debate – a growing number of media outlets are taking the view that addressing climate change is not just an environmental imperative but also a social one.
In this regard, financial services brands can’t show a real commitment to fighting climate change without also addressing the structural inequities that mean some groups – such as women, BIPOC communities, LGBTQ+ communities and people with disabilities – are disproportionately impacted. PR strategies that reflect an understanding of these disparities will resonate deeply as they reflect a holistic and genuine commitment to all facets of ESG.