Most consumers are keen to live more sustainably and consume green products. Unfortunately, greenwashing leads many astray and erodes consumer trust. Now the Competition & Markets Authority (CMA) have published a Green Claims Code that businesses must comply with in order to prevent greenwashing. Companies that do not comply could be subject to legal action.
The Code is part of the awareness campaign for the COP26, currently taking place in Glasgow. The Code is set up to help businesses navigate green claims responsibly and to prevent consumers from being mislead. A recent CMA study found that over 40% of currently green claims by companies were misleading. Andrea Coscelli, Chief Executive of the CMA: “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. 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.”
Here are the six principles of the Green Claims Code
- Businesses have to be honest about their products, services, brands and activities and portray their sustainability accurately.
- All credentials and messaging have to be clear and unambiguous and easy for the consumer to understand.
- No ingredients or relevant information can be hidden from the consumer. This will allow customers to make informed decisions.
- All comparison products must be intended for the same purpose or meet the same needs.
- Environmental impact of products must be shown throughout the whole lifecycle.
- All claims must be substantiated with scientific, credible evidence.
The CMA will be carrying out a review of company’s green claims from 2022. They will prioritize sectors that consumers feel most concerned about.
Greg Hands, Minister of State for Energy and Clean Growth: “Millions of households are rightly choosing to switch to green products as they look to reduce their carbon footprint. But it’s only right that this commitment is backed up by transparent claims from businesses. The competition regulator’s new code will help to ensure this with advice on how best to communicate and understand environmental claims.”
The CMA is not only setup to protect consumer rights, they also want to help businesses to accurately show their sustainability. Businesses can contact the CMA to ensure that they are compliant and not misleading consumers.