CMA highlights what constitutes greenwash

Greenwashing under scrutiny: CMA assesses ‘eco-friendly’ claims

Businesses – including retailers and consumer brands – using terms like “eco-friendly” to describe their products and services will now face increased scrutiny, after the Competition and Markets Authority (CMA) announced a new programme investigating such claims.

The initiative is in response to the growing number of products and services being marketed as ‘eco-friendly’, and against the backdrop of mounting public and commercial awareness of environmental issues and the climate crisis.

According to the CMA, UK consumers spent £41 billion a year on ethical goods and services in 2019 – almost four times as much as was spent 20 years ago. The CMA is concerned the surge in demand for green products and services could prompt some organisations to make “misleading, vague or false claims” about sustainability in an effort to attract shoppers.

Multiple sectors will fall under the CMA spotlight, but it is likely the focus will shine particularly on industries where consumers appear most concerned about misleading claims, such as textiles and fashion, and fast-moving consumer goods.

The CMA said examples of misleading behaviour might include exaggerating the positive environmental impact of a product or service, using complex or jargon-heavy language, and implying items are eco-friendly through packaging and logos when this is not true.

Another aspect that will be considered is whether failing to provide all relevant information about the sustainability of a product or service – for example, whether it is highly polluting or non-recyclable – could be deemed misleading and illegal.

As part of the process, the CMA is calling on the public to have their say on what they expect from eco-friendly products, how often they come across green claims, and what impact these comments have on purchasing decisions.

At this stage of the analysis, the CMA has no view as to whether or not consumer protection law has been broken, but action will be taken if evidence emerges that customers have been misled. Guidance is expected to be published next summer.

Andrea Coscelli, CEO of the CMA, said: “Increasing numbers of people are quite rightly concerned about the environment and want to play their part by being greener.

“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.”

He added: “We know that many businesses will be looking for ways to reduce their carbon footprint and we strongly support this, but the claims they make must not mislead consumers in the process. It’s important that people can easily choose between those who are doing the right thing for the environment and those who are not, so that businesses genuinely investing in going green can be properly rewarded by their customers.”

From 9 to 20 November 2020, the CMA will co-ordinate a ‘sweep’ of randomly selected websites alongside members of the International Consumer Protection and Enforcement Network, with the aim of identifying the types of misleading green claims made around the world.

All updates on the CMA’s work in this area can be found on the misleading environmental claims case page.

[Image credit: Green Retail World]

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