Transparency is key when it comes to determining if a company is truly committed to sustainability. Sustainable brands should be open and honest about their supply chains, environmental impact, and ethical practices, even if that means admitting imperfection. Many have sustainability reports on their websites that detail their progress and areas of improvement. Additionally, it's important to examine the ethical sources of a company's products.
If a company tests its products on animals or purchases them through unethical sources, it cannot be considered sustainable. Greenwashing is another factor to consider when assessing a company's commitment to sustainability. Greenwashing refers to companies or investments that promote themselves as more sustainability-oriented or environmentally focused than they actually are. For example, the BlackRock US Carbon Transition Readiness ETF is touted as having a lower carbon intensity than the index, but it includes oil companies such as Chevron and Exxon, which may not be suitable for investors committed to sustainability.