Greenwashing: A persistent challenge to achieving sustainability

Greenwashing continues to present a challenge for businesses looking to achieve genuine sustainability. As lawyers who regularly help clients navigate this particular challenge, we thought it would be useful to produce a very brief guide for companies to help them recognise and address unsubstantiated environmental claims.

A landmark case is unfolding in Danish courts. Danish Crown are accused of misleading consumers having claimed “Danish pigs are more climate-friendly than you think” and promised “climate-controlled pork”. In the aftermath of the accusation, Danish grocery chains denied selling meat with the label, forcing the firm to stop producing with the claims.

From a corporate perspective, both lawsuits and allegations from various agencies and associations can quickly decimate a reputation and force companies to discontinue certain lines. The fine for misleading consumers will of course be an unwelcome financial hit, but it is the impact on sales and revenue that will really impact a company.

There is an increase in the number of cases concerning greenwashing and misleading marketing. This means it is here to stay and something that as a company, you must address.

BEST PRACTICE FOR COMPANIES

Understand yourself

Work out if you’re green or not. Choose the products or services you wish to promote as eco-friendly carefully and consider your local reputation.

Prioritise intentional green design

Sustainable products should undergo thorough life-cycle analysis, addressing environmental impact from source to disposal. This makes them easier to promote responsibly.

Thorough checks are essential

Experts can be your toughest critics. They are well-versed in your company’s environmental challenges and can often have audited data on your company's overall environmental impact. Seek their input before starting green marketing efforts.

Third-party endorsements

Endorsements from respected organisations on your labels, logos and marketing material are a strong signal of your product's integrity. Avoid shortcuts and half-hearted efforts.

Be aware of the terms you use

'Organic' has a strict legal definition and other terms - like 'Fairtrade' - are copyrighted. If you use such terms, ensure you can provide clear justifications for their meaning.

Check for greenwashing

Screen all communication channels for potential greenwashing including your advertising, PR, packaging and even your CEO’s speeches.

What NOT to do

  • Never mislead / deceive consumers
  • Never make unsubstantiated claims
  • Never be vague
  • Never portray your product as having qualities it doesn't actually possess
  • Never present your product as having attributes it genuinely lacks

EU TAKES STEPS TO PROHIBIT GREENWASHING AND ENHANCE PRODUCT INFORMATION

The EU Parliament and Council have reached a provisional agreement on new rules to ban misleading advertisements and provide consumers with better product information.

Incoming banned commercial practises: Generic environmental claims, without proof of recognised excellent environmental performance relevant to the claim.

The parliament also intends to prohibit environmental claims that are solely based on CO2 compensation schemes and to streamline product information by allowing sustainability labels that are based on official certification schemes or have been approved by public authorities.

If you are concerned you may be open to claims of greenwashing and would like us to take a look or if you’d like our team to provide an online training session on how to avoid greenwashing claims, please contact us today.

REFERENCE SOURCES

If you would like to find out more about greenwashing, these links may help:

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