UK Regulators to Clamp Down on Greenwashing
With the UN Climate Change Conference of the Parties (COP26) taking place in Glasgow in just over a months time (31 October – 12 November 2021) and PM Boris Johnson stating that: “It’s time for humanity to grow up,” in relation to tackling Climate Change, sustainability and environmental issues are high on the agenda.
Pre-pandemic Climate Change was hitting the headlines on a daily basis and as a result businesses have had to re-examine their own practices and make changes where possible. Fashion in particular was under fire for being a major polluter, responsible for 10% of annual global carbon emissions. Large brands sat up and took note and many include a ‘corporate responsibility’ page to reveal their practises and plans on their websites.
In a bid to reassure consumers that their brand or company is ethical or sustainable there has also been a rise in ‘Greenwashing’ – a practice where brands or businesses appear to be interested in protecting the environment through marketing or misleading information.
Now UK authorities have warned businesses they have until 2022 to make sure their green claims comply with the law – or risk fines and other penalties. The move is part of a clamping down on greenwashing by the authorities, with fashion and textiles a priority sector.
The Competition and Markets Authority (CMA) published its finalised Green Claims Code, which is focused on 6 principles based on existing consumer law. These are:
1. Being truthful and accurate
2. Being clear and unambiguous
3. Not omitting or hiding important information
4. Only making fair and meaningful comparisons
5. Only considering the full lifecycle of a product
6. Being substantiated
Last year, the CMA found that 40 per cent of green claims made online could be misleading following an investigation of websites, with fashion one of the sectors investigated.
Fashion-Enter CEO Jenny Holloway commented: “About time! The garment manufacturers that are working ethically, correctly and with true sustainability at its fundamental ethos have lost out for years to non-compliant factories. This then drives prices down putting more pressure on margins. However, how will this be enforced? Will fines be implemented and how will ethical suppliers be supported?”
The CMA’s intention is to help businesses understand how to communicate their green credentials while reducing the risk of misleading shoppers. It is clear that firms making green claims “must not omit or hide important information” and “must consider the full life cycle of the product”.
The Code is part of a wider awareness campaign which the CMA has launched ahead of COP26.
Andrea Coscelli, Chief Executive of the CMA, said:
“More people than ever are considering the environmental impact of a product before parting with their hard-earned money. We’re concerned that too many businesses are falsely taking credit for being green, while genuinely eco-friendly firms don’t get the recognition they deserve.
“The Green Claims Code has been written for all businesses – from fashion giants and supermarket chains to local shops.
“Any business that fails to comply with the law risks damaging its reputation with customers and could face action from the CMA.”
The Green Claims Code has been published following extensive consultation with businesses of all sizes and consumer groups. Businesses should check their green claims against the Code and seek legal advice if they are unsure whether their claims comply with the law.
More information can be found on the misleading environmental claims case page.