The United Kingdom’s Competition and Markets Authority (“CMA”) is preparing to crack down on greenwashing. In a statement on Monday, the competition watchdog revealed that it will investigate “descriptions and labels” used by companies in a “wide range of sectors” to promote products and services claiming to be “eco-friendly,” and whether those labels “could mislead consumers,” and run afoul of the law in the process. Of primary interest to the CMA? Companies in the business of “textiles and fashion, travel and transport, and fast-moving consumer goods (food and beverages, beauty products and cleaning products).”
According to a newly-issued statement, as first reported by Bloomberg, the CMA says that on the heels of a preliminary probe, it is concerned that the growing surge in demand among consumers for green products and services “could incentivize some businesses to make misleading, vague or false claims about the sustainability or environmental impact of the things they sell.” With that in mind, the competition body claims that such legally out-of-bounds behavior could consist of “exaggerating the positive environmental impact of a product or service, using complex or jargon-heavy language, [and/or] implying that items are eco-friendly through packaging and logos when this is not true,” all of which fall under the general umbrella of greenwashing.
As part of the investigation, the CMA revealed that it will “also consider whether failing to provide all relevant information about the sustainability of a product or service – for example, whether it’s highly polluting or non-recyclable – could mislead consumers and therefore break consumer law.”
In connection with the investigation, the CMA is calling on consumers to share “what they expect from eco-friendly products, how often they come across green claims, and how these claims affect their purchasing decisions.” The regulator says that it is also working with charities, businesses and other organizations to get a clearer picture of the issues in this area, and aims to publish guidance for businesses in 2021 in order “to help them support the transition to a low carbon economy without misleading consumers.”
The new initiative comes as greenwashing – or the corporate practice of making sustainability claims to cover a questionable environmental record and/or of making sustainability claims of questionable merit – has continued to plague industries ranging from cars to clothes. As we have discussed in the past, the boom in eco-centric endeavors by consumer goods brands has led to a proliferation of misleading marketing in the sustainability space in large part because much of the terminology being used is often extremely vague … and thus, difficult to police from a legal perspective.
Most of the buzzwords that dominate this type of advertising – from “sustainability,” “green,” and “eco-friendly,” “ethical,” “responsibly-made,” and in many cases, even “upcycled” – lack concrete, uniform definitions with foundations in law that brands and consumers can observe.
There are some exceptions, in the U.S., at least, including for terms like “biodegradable,” which the Federal Trade Commission (“FTC”) defines as a product “completely breaks down and returns to nature” within one year. It is also worth noting that the FTC’s lengthy Green Guides do mandate that marketers must “not make unqualified general environmental benefit claims because ‘’it is highly unlikely that marketers can substantiate all reasonable interpretations of these claims.’” Moreover, the FTC asserts that while “marketers may be able to qualify general environmental benefit claims to focus consumers on the specific environmental benefits that they can substantiate,” they should use “clear and prominent qualifying language to convey that a general environmental claim refers only to a specific and limited environmental benefit(s).”
The result is that the vast majority of the buzzy marketing terminology that brands use to target consumers, particularly socially-conscious millennial and Gen Z-ers, is just that: buzzy marketing terminology – as opposed to objectively discernible or quantifiable terms. The distinction is significant, as loosely defined concepts, such as “green,” remain open to interpretation by brands and consumers, alike, in terms of what they actually entail, and they are not subject to the same substantiation requirements as objective assertions about a product or service. This is a large part of why fast fashion companies (and even high fashion companies, too) are not regularly hauled into court for false advertising when they advertise their “sustainable” garments and report “strong progress towards sustainability,” all while simultaneously making headlines as a result of supply chain abuses and the large-scale destruction of unsold – but potentially otherwise recyclable – products.
The CMA seems eager to potentially put a dent in such rampant instances of misleading advertising. Beginning on November 9 and carrying on until November 20, the CMA says it will “co-ordinate a ‘sweep’ of randomly selected websites with [International Consumer Protection and Enforcement Network] members, with the aim of identifying the types of misleading green claims being made around the world.”
“Increasing numbers of people are quite rightly concerned about the environment and want to play their part by being greener,” Andrea Coscelli, Chief Executive of the CMA, said on Monday. “Our role is to make sure that consumers can trust the claims they see on products for sale and don’t fork out extra for items falsely presented as eco-friendly.”
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