“Sustainability” has become a promise without being a promise. A word used as a moral shield in ESG reports, on websites, and in strategy plans often without anyone asking: What does it actually mean? How do we know it is true? And who is accountable if it is not? In a time when reality demands precision, “sustainability” has become too vague. Too elastic. Too comfortable. And for that very reason, it has become a misused term in ESG reporting.
Close-up of lush green leaves with dewdrops, capturing a refreshing and natural texture.
The law has spoken and words must be documented
According to the Danish Marketing Practices Act, it is not merely incorrect but outright illegal to use statements that may mislead consumers. This applies not only at product level but across all corporate communication. When a company, for example, describes itself or its activities as “sustainable” without being able to present objective and methodical documentation, it is in breach of the law.
In a competitive context, however, this is more than legally irresponsible it is also distortive of competition. When a company positions itself as “sustainable” without documentation, it gains an unfair advantage over competitors who invest time and resources in documenting their climate and environmental impact. This undermines market trust and signals that ambition outweighs responsibility. That is the opposite of what ESG is about.
The Danish Consumer Ombudsman’s 2024 guidance is therefore very clear. Vague and generic claims such as “green,” “environmentally friendly,” and “sustainable” will typically be perceived as a blanket guarantee that all or parts of a company’s activities have a positive or neutral environmental impact. This is rarely true and therefore requires high-level documentation such as life cycle assessments, recognised standards, third-party verification, and consistent methodology. Even then, it is rarely sufficient to lawfully use the term “sustainable.”
With legislative proposal L 147, expected to enter into force on 27 September 2026, these requirements will be formalised in regulation. Going forward, it will be considered misleading to use claims such as “sustainable” unless the documentation covers the entire life cycle of the product or the company. In practice, this means that in most cases it will be legally impossible to use the word correctly.
ESG is not sustainability. It is risk analysis.
In ESG reporting, good intentions are not enough. This is about compliance, about structure, methodology, data, and risk analysis.
We too often see companies (and yes, advisers as well) approach ESG from a communications perspective as if it were about telling the right story. But ESG is not about storytelling or sustainability. It is about documented reality, such as:
- understanding supply chains and hidden risks in the supplier tier
- being able to read procurement contracts and identify where data is missing
- understanding the specific industry, its realities, and its requirements
- linking LCA, LCC, or other valuable data into ESG
When ESG turns into greenwashing
Many companies unintentionally slide down a slippery slope when they include statements in their ESG reporting such as: “We work with sustainability” or “We have a sustainable business model.” It sounds fine but it is potentially illegal unless it can be documented with, for example, LCA analyses, third-party certification, or data-driven methods.
Without concrete documentation, an ESG report effectively becomes a greenwashing report if it makes broad sustainability claims without evidence.
If a claim cannot be documented with, for example, a life cycle assessment (LCA), third-party certification, recognised methodology, or valid data, you risk publishing a greenwashing report instead of an ESG report. And that is serious.
Therefore, it is essential to understand the difference between ESG and sustainability. Sustainability is a broad concept often normative and value based. ESG, by contrast, is a data system. A rule set. A method.
What does sustainability and ESG mean and why did ESG emerge?
“Sustainability” traces back to the Brundtland Report of 1987, which defined it as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs.” It is a broad concept covering environmental, social, and economic responsibility, but it is often used without precise criteria.
ESG emerged as an attempt to translate broad, value-based considerations into concrete, measurable, and comparable parameters that can underpin regulation, investment, and business strategy. ESG is not an ideal it is a system. It is about risk, compliance, strategy, and reporting.
Why it is crucial to prepare an ESG report
Companies are operating in a new reality marked by fragile supply chains, geopolitical instability, climate crisis, biodiversity loss, and scarcity of critical raw materials. This requires strategic oversight and a deep understanding of where the company is vulnerable and where it can act proactively.
An ESG report is not just a report. It is a strategic risk-management tool. But it requires more than goodwill it requires the ability to analyse data, understand supply-chain complexity, navigate compliance, and identify business-critical risks.
In short: you must understand the business and develop it based on documented realities. That is what a strong ESG report does.