Regulators have warned that businesses must be prepared to face enforcement action over greenwashing.
That’s the message after the Competition and Markets Authority (CMA) published draft guidance around ‘green’ claims.
In 2020 the CMA began investigating the impact green marketing has on consumers, with a ‘careful review’ of how claims are being made and ‘how people respond to them’. It found that 40% of the environmental claims made by companies – including food and drink brands – could be misleading. Such greenwashing tactics could break consumer law, according to the International Consumer Protection Enforcement Network.
The CMA’s draft guidance now sets out advice on how brands can communicate their green credentials without misleading the public.
It offers two examples specific to the natural and organic sector. When marketing a loaf of organic sourdough, ‘sector-specific rules mean food products must be made from at least 95% organic ingredients to be labelled as organic – a claim would be misleading if that threshold is not met’. For toiletries, the CMA says that if a company sells a range of beauty and personal care products ‘with a green banner across the corner of the image’ which states ‘save our seas – these are microbead-free’, then the claim is likely to be misleading. “It suggests a benefit in comparison to other products, when in fact microbeads are banned in the UK and should not be in any products.”
The guidance sets out six principles which any environmental claim should follow:
- They must be truthful and accurate: businesses must live up to the claims they make about their products, services, brands and activities
- They must be clear and unambiguous: the meaning that a consumer is likely to take from a product’s messaging and the credentials of that product should match
- They must not omit or hide important information: claims must not prevent someone from making an informed choice because of the information they leave out
- They must only make fair and meaningful comparisons: any products compared should meet the same needs or be intended for the same purpose
- They must consider the full life cycle of the product: when making claims, businesses must consider the total impact of a product or service. Claims can be misleading where they don’t reflect the overall impact or where they focus on one aspect of it but not another
- They must be substantiated: businesses should be able to back up their claims with robust, credible and up to date evidence.
Andrea Coscelli, chief executive of the CMA, comments that ‘as more people than ever are trying to make choices which are better for the environment’ there is a concern that ‘people are paying extra for so-called ‘eco-friendly’ products and those businesses that are genuinely investing in going green aren’t getting the recognition they deserve’.
“People must be able to trust the claims they see and businesses must be able to back them up,” says Coscelli.
The CMA now seeks views on its guidance and is ‘particularly keen to hear from anyone who buys or sells products which claim to be eco-friendly, including whether any information is needed to help companies comply with the law’.
A consultation will run until 16 July, with final guidance expected to be published by the end of September.
