“Greenwashing” occurs when a business makes misleading environmental and sustainability marketing claims, such as claiming to be “environmentally friendly” or “sustainable”, that are not backed up with appropriate evidence.
Greenwashing is one of the key enforcement priorities of the Australian Competition & Consumer Commission (ACCC) throughout 2022-23.
Following a recent internet sweep, the ACCC found that more than half of the businesses reviewed made concerning claims about their environmental or sustainability practices. This article explores the key considerations.
The greenwashing internet sweep
The ACCC conducted an internet sweep to identify misleading environmental and sustainability marketing claims in October/November 2022.
247 company websites were reviewed across a range of sectors:
The findings
Of the 247 businesses reviewed during the sweep, 57 percent were identified as having made concerning claims about their environmental credentials. This included:
- Using vague or unclear environmental claims.
- Not providing sufficient evidence for their claims.
- Setting environmental goals without clear plans for how these will be achieved.
- Using third-party certifications and symbols in a confusing way.
The cosmetic, clothing and footwear, and food and drink sectors were found to have the highest proportion of concerning claims among the industries targeted in the operation. Other sectors examined also had a significant proportion of concerning claims.
What is the ACCC doing to combat greenwashing?
The ACCC has several active investigations underway for alleged misleading environmental claims. These investigations span the packaging, consumer goods, food manufacturing and medical devices sectors.
This number is likely to grow as the ACCC commences new investigations following the internet sweep, which could lead to enforcement action.
“We will take enforcement action where it is appropriate to do so as it is critical that consumer trust in green claims is not undermined,” ACCC Deputy Chair Catriona Lowe said.
“Importantly, we encourage businesses to come forward if they become aware they have made false or misleading marketing claims. Businesses who cooperate and advise of any issues with their operations, will be considered more favourably than those who wait for the ACCC to unearth these problems,” Lowe said.
Key takeaways
The ACCC has made combatting greenwashing a priority in 2022-23, and their recent internet sweep found that over half of the businesses reviewed made concerning claims about their environmental credentials. The ACCC is actively investigating alleged misleading environmental claims, which could lead to enforcement action. If businesses come forward to the ACCC about false or misleading marketing claims, they may be considered more favourably.
