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Despite the recession, many are still spending green to be green

Fernando Morales/The Globe and Mail

When Mark Carli replaced the appliances, furnace and electric boiler in his North Toronto home, he spent an extra $700 for the energy-efficient options. He forked out a further $1,000 to insulate the basement, replace the windows and install water-efficient toilets and shower heads. Those hefty investments have paid off, chopping as much as $1,350 a year from his energy and hydro bills.

"We are not necessarily tree-huggers but we try to make informed decisions regarding the environment," Mr. Carli said of his family. They use cloth shopping bags, walk to the grocery store and try to buy local produce. Ultimately, however, their household buying decisions are decided by price.

At a time when the economic recession is straining many household budgets, families such as the Carlis are looking for ways to marry their need to be frugal with their desire to be green. Turns out, a reduction in income does not automatically mean a drop in eco-consciousness as people continue to stop and consider the true cost - environmental and monetary - of their purchases. Unlike the 1980s, when the economic downturn stopped the environmental movement in its tracks, concern over the fate of our planet is still going strong, says Rick Smith, executive director of advocacy group Environmental Defence. "The environmental movement has proven to be recession-proof."

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Ela Beres, a Toronto-based consultant with The Boston Consulting Group, interviewed several Canadian families on the impact green choices were having on their everyday spending. People are definitely interested in helping the environment if it costs the same or less, she says. "That's a no-brainer. But when it comes to saying I want to spend more money to protect the environment, that is more iffy."

Although it calls for a large initial investment, many people understand the value in starting with their house. "Families are going green from the outside in," Ms. Beres said. "That is where the savings are most significant and most quantifiable, both financially and environmentally."

Allison Wallis, a manager with GreenSaver, says government incentives are enticing home owners to undertake residential energy efficiency improvements in these tough economic times. (The federal home-renovation tax credit provides a credit of up to $1,350 for renovations costing between $1,000 and $10,000. Ottawa is also providing rebates of up to $5,000 for energy efficiency upgrades.) Sales at GreenSaver, a non-profit that performs energy and electricity audits, have risen by around 35 per cent from last year.

But when it comes to smaller goods, Boston Consulting Group research found that purchases of green, local or organic products are more sporadic and depend on whether there is a clear and compelling reason to buy them: People need to be sure that the purchase will have a positive impact on the planet.

"There are situations where environmental effects of consumer green products are not clear," Ms. Beres said. "Everyone knows that if you use energy-efficient appliances, it translates into clear environmental benefits. That same research and data is not available for the effect of buying products made from recycled materials."

Mohamed Oqab is one Canadian who does his own research. "If there is a new product, we always read the package." His 13-year-old son is a die-hard environmentalist who drew his father into the fold. Two years ago Mr. Oqab was laid off from his job as an IT consultant in Mississauga. Now that he is self-employed, finances are tighter. "We are much more aware of how much we spend," he said. But the family still buys green cleaning products, composts part of their garbage and shops for local food.

Consumers who don't have the time or passion to do their own homework can feel lost amid the dizzying selection of green, natural and organic products. Indeed, a walk down the aisle of a large Toronto grocery store found that prices varied among products, with organic and non-organic peaches carrying the same price tag while organic broccoli cost nearly twice as much as its non-organic counterpart. Diapers claiming to be environmentally responsible were $3 cheaper than the regular ones.

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Mr. Smith acknowledges that the explosion of new green products makes it confusing for shoppers to know whether they are making the right choice. "What we have at the moment is a lack of adequate labelling requirements, a lack of government oversight of company claims of greenness and an avalanche of information that is hard to sift though if you are a consumer."

There has been some progress. A national Canadian organic products standard came into effect on July 1. But in many cases, the onus is on the consumer to go and search for the information they need to make an informed decision.

Claudio Gemmiti, vice-president responsible for the PC Green brand and Loblaw Brands at Loblaw Companies Ltd., says they are taking steps to address customer confusion. "We try to be as specific as we can. To provide real scientific facts on how each product will help the Earth." Sales of both green and organic products at their stores are growing quickly, he added, despite a comparatively small amount of promotion.

In the meantime, Canadians continue to weigh the pros and cons of where - and on what - they spend their hard-earned dollars. Mr. Oqab says he would have loved to buy a hybrid car, but a $20,000 price difference forced him to settle on another model. "If the price difference is big, we have to make a tough decision. But 90 per cent of the time, the environment wins out. I wish I could do better but there are limits. If I compare myself to where I was five years ago, I am doing okay."

Seven sins of greenwashing

An April report from TerraChoice Environmental Marketing, an Ottawa-based environmental marketing agency, found that between 2007 and 2009, the number of so-called "green" products on Canadian store shelves jumped 79 per cent.

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But 98 per cent were still guilty of some degree of greenwashing, defined as the act of misleading consumers regarding the environmental practices of a company or the environmental benefits of a product or service.

Here are TerraChoice's top seven greenwashing sins, and what to watch for when choosing products.

The Sin of the Hidden Trade-Off: When one environmental issue is emphasized at the expense of potentially more serious concerns. Paper, for example, is not necessarily environmentally preferable just because it comes from a sustainably harvested forest.

The Sin of No Proof: When environmental assertions are not backed up by evidence or third-party certification. One common example is facial tissue products that claim various percentages of post-consumer recycled content.

The Sin of Vagueness: When a claim is so lacking in specifics as to be meaningless. "All-natural," is an example. Arsenic, uranium, mercury and formaldehyde are all naturally occurring, and poisonous.

The Sin of Worshipping False Labels: When marketers create a false suggestion that a product has passed a legitimate green certification process, using certification-like images.

The Sin of Irrelevance: When an environmental issue unrelated to the product is emphasized. One example is the claim that a product is "CFC-free," since CFCs are banned by law.

The Sin of Lesser of Two Evils: When an environmental claim makes consumers feel "green" about a product category that is itself lacking in environmental benefits. Organic cigarettes are an example.

The Sin of Fibbing: When environmental claims are outright false.

Roma Luciw is a writer and web editor of the personal finance site. Please send any comments and story ideas to

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About the Author
Personal Finance Web Editor

Roma Luciw is the Globe and Mail’s personal finance editor. She has worked at the Globe as a business journalist since 2001, covering stock markets, breaking news, and most recently anything that helps regular Canadians manage their own money. More

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