The Shades of Green Capitalism

Disclaimer: This essay was adopted and adapted from a reading response of the same name that was first written for the module UTC1102R Green Capitalism: A Critical Engagement. More information about the module can be found here.


“A smile is the chosen vehicle of all ambiguities”. The words of novelists and short story writers such as Herman Melville are not usually used, beyond the realm of children’s stories anyways, as a critique of the changing world around us. There, however, has not been a more apt quote than this in describing the calls for a sustainable economy. In a world plagued with the twin crises of economic ruin and environmental disaster, green capitalism is often touted as a solution due to its potential to boost economic growth and protect the environment at the same time. But can green capitalism really be the singular solution to the plurality of our problems?

Green capitalism is defined as:

Green capitalism is a form of environmentalism that emphasizes the economic value of ecosystems and biological diversity and attempts to reduce human environmental impacts by ensuring that the importance of environmental services is reflected in the way that markets operate.

(Scales, 2017, p. 1)

In effect, the hallmark of green capitalism is the preservation of the environment through the use of market mechanisms to spread green initiatives. The hope is that this creates sustainable markets and, in turn, sustainable economies.

This brings us to the next question of why it is gaining so much traction. The investments that green capitalism would attract could provide economies a way to continue growing since investments stimulate economic growth. If executed properly, the resulting picture could be one that is much healthier for the environment, thus killing two birds with one stone.

It is important to note, however, that green capitalism is not synonymous with corporate environmentalism, as it involves not just corporations but other agents as well. Hence, the essay will be discussing the application of green capitalism at three different levels: markets, corporations, and consumers.


At the market level, the market mechanism will be used to spread the green initiative by attracting investments into new “green” markets, such as those in solar energy. The logic is devilishly simple – if there is no space left for investments in existing markets, just create more in new ones. Since the green project is still in its stages of infancy, there is much potential. A report overview by Allied Market Research (n.d.), an advisory company that provide business insights to enterprises, states:

The global green technology and sustainability market size was valued at $8.79 billion in 2019, and is projected to reach $48.36 billion by 2027, growing at a [compound annual growth rate] of 24.3% from 2020 to 2027.

To put things into perspective, a typical market’s compound annual growth rate, which tells us the rate of returns for investments, usually stands at a much lower rate of around 5 to 10%. That, coupled with a projected 500% growth of the green market size in under ten years, is a statistic that screams potential. Extrapolate this demographic and it is no wonder so many want a slice of this cake. If this market matures further, it could send a strong signal that a sustainable economy need not be without profit, as many might think so.

Having said that, there are limitations to it as well. Using market mechanisms means carrying along the stains of capitalism. And in a market expected to be highly attractive to investments, a very prominent limitation is that markets cannot grow indefinitely and are inherently at risk of the crisis of accumulation.

In the crisis[,] the overaccumulation of capital suddenly appears in the form of a mass of worthless debt and an enormous overproduction of commodities, leading to the massive devaluation of productive capital and destruction of productive capacity, and an enormous increase in the reserve army of labour, in a cumulative spiral which will only be checked when the conditions for profitable accumulation have been restored.

(Clarke, 1990, pp. 461-462)

Translation: A lot of capital is invested, which a company uses to ramp up production. However, supply now far surpasses demand, meaning production costs incurred are not translating into profits. Companies are then left with products they cannot sell and workers they cannot afford to pay. The investment, hence, draws no return.

In short, there will come a point when the returns to investments are no longer profitable, in which case the market has reached a saturation point and cannot viably expand further.

For the green initiative to keep on developing, it has to penetrate new markets continually to prevent the proverbial pot of gold from emptying out. In this sense, the conceptualisation of building a green economy through new markets is no different from any that came before.


The easiest way for corporations to contribute to the green wave is through corporate social responsibility (CSR). A local example would be NTUC’s “No Plastic Bag” Initiative, which donates money earned from the sales of tote bags to environmental and community causes.

However, remembering that corporations are ultimately for-profit organisations, it begs the question: Are corporations commodifying the green initiative by engaging in greenwashing so as to position themselves favourably among consumers?

Greenwashing is defined as:

Greenwashing is where a firm spends time and money advertising and marketing that their goods or services are environmentally friendly when, in fact, they are not.

(Corporate Finance Institute, 2020)

Research by Clutch, a leading platform that reviews service providers, has shown that consumers are more willing to pay if what they are paying more for comes from a socially-conscious company, especially one that is concerned with climate change. Opportunism is a trait that every economic agent is expected to have. Thus, the justification that the profit margin to be gotten from positioning your brand in support of such movements is merely a side benefit and not a business-centric decision aimed at increasing profits is dubious, to say the least.

To illustrate the concept of greenwashing, we can examine the ways in which the aviation industry has tried to advertise themselves as green practices. The industry is a massive contributor to gas emission. In 2017, carbon dioxide (CO2) emissions from global commercial aviation was 860 million tonnes; in 2018 that number raised to 905 million tonnes (Overton, 2019).

In recent years, more airports have been attempting to rebrand themselves as ‘carbon neutral’, meaning that there is no net emission of CO2. However, these are often misleading as they simply distract from the gas emissions from flights themselves. A case in point is the Heathrow Airport, which claims to be carbon neutral even though the flights to and from the airport contribute the biggest amount of CO2 in the United Kingdom (UK) (Overton, 2019). Furthermore, even if an airport does engage in eco-friendly practices, they cannot be compared to the amount of fossil fuels to put planes in the sky. A local example, would be Changi Jewel, which uses solar panels and uses rainwater for its famous Rain Vortex and other purposes such as irrigation. It is likely safe to say that clean energy is also used for luggage transportation and food waste recycling, similar to the other terminals. However, if we consider the flights (especially with the Jewel’s popularity), these practices are merely a drop of green in a bucket of black.

A possible remedy to greenwashing would be the adoption of policies that reflect an actual desire to encourage and enable sustainability. In recent years, there has been an increase in the number of B-Corporations, which are required to express their commitment to change before being certified by changing their legal structures. For example, B-Corporations in America can change their legal structures to resemble those of benefit corporations, which include positive environmental outcomes as a legal requirement when considering the companies’ success. This solution allows for a more stringent form of accountability as businesses who publicise themselves as having sustainable practices are required to put their money where their mouth is. (More about B-Corporations can be found here.)

However, this solution is quite limited due to its reach. There are only slightly more than 3200 certified businesses in less than 80 countries, too little compared to the millions around the world and possessing too little market power to make a considerable impact.

Furthermore, due to other factors that are also weighed for certification, the extent to which it can credibly recognise the environmental efforts specifically is limited. These factors include the company leadership, treatment of workers, and impact on the community. These are not detrimental additions, but it does call into question how far the certification can be considered a green stamp of approval. After all, the points gained could be obtained from improvements in other areas, and not because one’s business made considerable efforts for positive environmental outcomes.


In discussing the impact that consumers can have on the economy, a question that usually comes to mind is what change we as consumers can induce in an economy. If even the combined market power of businesses can be drowned out by the corporate machine, what then of consumers’, whose power extends only to the individual’s purchasing power? This is the conundrum of the powerless consumer.

The construct of consumer powerlessness is defined as an expectancy of an individual that her or his behaviour cannot achieve desired outcomes … [and] the customer’s belief that he or she is unable to influence the outcomes of a relationship with a firm.

(Bunker & Ball, 2009, p. 269)

The greatest argument for the role of consumers in green capitalism is that they can use their demand to send a signal. In choosing to pay for eco-friendly products and services and supporting the businesses that provide them, consumers have the power to signal their concerns over the environment by reflecting them in their choices. This might force larger corporations to revamp themselves in order to remain relevant in a changing social climate. It is a similar concept to citizens exercising their vote to voice displeasure.

However, the effectiveness of consumers exercising their purchasing power by changing demand is thrown into ambiguity when we consider the illusion of choice.

The illusion of choice is a psychological mental model that states humans are happy if they believe that [they] have control over their own actions and can exercise free will.

(Kennon, 2010)

Large corporations such as The Coca-Cola Company often acquire smaller ones in order to diversify their revenue streams. However, acquisitions do not simply serve this one purpose. In diversifying themselves, such corporations are also reducing the likelihood that a change in consumer demand necessarily means an equivalent loss of revenue.

For example, a consumer wishes to opt for healthier drinks and chooses to buy say, the smoothies sold by the company Innocent instead of a can of Sprite. This change in demand does not change the flow of revenue since The Coca-Cola Company is the parent company of both of them. The supposedly signal that is sent, is negated. The reality is that consumer choice is being manipulated to give the false impression that consumers ultimately have the power to influence corporate interests.

There is a case to be made that consumers can choose to support independent start-ups in order to overcome the illusion. But large corporations also have economies of scale on their side, meaning that support for independent stores would be limited since their alternative products are likely more expensive. Independent stores are also more inaccessible since they usually do not have many locations. Even the wet markets of Singapore, which are numerous and sell produce at more affordable prices as compared to supermarkets, are busiest in the early part of the day, not a practical timing for the average working consumer.

To truly make a change, it is not merely individual demand that needs to change, but collective demand. A change in collective demand would be able to send the signal that is negated at the individual level. However, changing demand to the extent that is necessary to send such a signal is not easy.

Not everyone can afford bamboo straws.


In conclusion, green capitalism is not to be taken at face value. It needs to be evaluated on the bases of its limitations and long-term impacts to more accurately flesh out the varying shades of effectiveness as a sustainable solution. While it has the potential to engage with multiple economic agents, each comes with its own challenges. The limitations of using market mechanisms, greenwashing, and the illusion of choice all paint an image of the green wave grimmer than most people are inclined to believe. Despite all this, it is still being hailed as the solution of all solutions. Admittedly, the theory behind the conceptualisation of green capitalism does provide hope for a more sustainable economy, but then again that is only theory. Green does have its appeal, but colour me sceptical.

Feature image from Micheile Henderson from Unsplash. Header image adapted from Markus Spiske from Unsplash.

About the Author:

Sven is a second year sociology major in FASS. He enjoys sports; he likes playing badminton, swimming, and running away from responsibilities. He also dreams of having a dog.


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