A “greenwashing” campaign in Europe has not gone well
- The European Commission, the EU’s executive arm, recently published its so-called “Green Claims Directive”.
- The long-awaited proposal seeks to establish an EU-wide methodology that will help clean up the market for environmental claims.
- Campaigners have largely welcomed the desire to curb the burgeoning corporate greenwashing trend.
- But they say that a months-long lobbying effort has “significantly diluted”[ads1]; the directive to such an extent that the measures are now too vague to solve the problem adequately.
Greenwashing refers to the marketing practice in which companies seek to capitalize on the growing movement for environmentally friendly products by selling goods labeled as green that in fact are not.
Andrew Aitchison | In pictures | Getty Images
The EU outlined new measures designed to stop companies making unsubstantiated environmental claims about their products, and warned firms they could soon face penalties of at least 4% of their annual revenue for “greenwashing”.
The European Commission, the EU’s executive arm, published its so-called “Green Claims Directive” on Wednesday. The long-awaited proposal seeks to establish an EU-wide methodology that will help clean up the market for environmental claims.
The directive must be approved by the European Parliament and the Council before it can enter into force.
The EU says it hopes to provide more clarity to consumers, so that when a product or service is sold as green, they can trust that it is actually environmentally friendly.
Today, most green claims are too good to be true, and the proposition is… far from the real (green) deal.
Margaux Le Gallou
program manager for environmental information and assessment in the Environmental Coalition on Standards
However, the proposals have received a mixed response from consumer and environmental organisations.
Campaigners have largely welcomed the desire to curb the growing corporate greenwashing trend, but say months of lobbying have “significantly watered down” the directive to such an extent that the measures are now too vague to adequately address the problem.
They have called on the European Parliament and the Council to improve the proposals so that they are “of value” to consumers and businesses.
Greenwashing refers to the marketing practice in which companies seek to capitalize on the growing movement for environmentally friendly products by selling goods labeled as green that in fact are not.
It is a significant problem within the EU. For example, a commission study published in 2020 found that more than half (53%) of green claims about products and services were considered to be vague, misleading or unsubstantiated, while 40% were unsubstantiated.
Some phrases that consumers may have become accustomed to when purchasing goods include “eco-friendly”, “ethical” or “sustainable”.
The commission says there are around 230 different eco-labels used across the 27-nation bloc, citing evidence that this is leading to confusion and mistrust among consumers.
The EU’s “Green Claims Directive” seeks to tackle this trend.
It says the proposal will ensure that claims are communicated clearly for the benefit of consumers – and businesses – and notes that firms that make a real effort to improve the environmental sustainability of their products should be more easily recognized and therefore able to increase sales.
The measures target explicit claims, the commission says, such as “CO2-compensated delivery”, “packaging made from 30% recycled plastic” or “sea-friendly sunscreen”.
However, it does not cover terms such as “carbon neutrality,” advocacy groups said, noting that this is a preferred marketing strategy for companies looking to give their products a “green makeover.”
“This proposal is a huge missed opportunity to send a powerful message to companies that the EU takes corporate climate responsibility seriously,” said Lindsay Otis, a policy expert on global carbon markets at Carbon Market Watch.
“The Commission appears to understand the problems created by greenwashing, but refuses to adequately address them,” Otis said. “It is now up to the European Parliament and the Council to pass a ban on carbon neutrality claims, because anything less than that will not only fail to protect consumers, but will also fail to push companies towards truly sustainable practices.”
“With this proposal, we give consumers the reassurance that when something is sold as green, it is actually green,” said Frans Timmermans, executive director of the European Green Deal.
Anadolu Agency | Anadolu Agency | Getty Images
The EU says that before companies communicate any of the covered types of green claims, companies must first have them independently verified and proven with scientific evidence. EU member states will have control over establishing a verification process that is monitored by independent bodies.
Companies based outside the EU that make green claims aimed at the bloc’s consumers will also be required to comply with the directive.
“Green claims are everywhere: ocean-friendly t-shirts, carbon-neutral bananas, bee-friendly juice, 100% CO2-compensated deliveries and so on,” said Frans Timmermans, executive director of the European Green Deal.
“Unfortunately, these claims are all too often made without any evidence or justification whatsoever,” he added. “With this proposal, we give consumers the peace of mind that when something is sold as green, it is actually green.”
The proposal excludes claims covered by existing EU rules, the commission says, such as the EU eco-label or logo for organic food.
Margaux Le Gallou, program manager for environmental information and assessment at the non-profit Environmental Coalition on Standards, said “tackling misleading green claims is critical to ensuring consumers are provided with reliable information and empowered to make sustainable choices.”
“Unfortunately, without harmonized methods at EU level, the new directive will provide little clarity for consumers and business, and will only complicate the job of market surveillance authorities. Today, most green claims are too good to be true, and the proposal is .. . far from the real (green) deal,” Le Gallou added.
Others were more optimistic about the potential impact of the measures proposed by the Commission.
The proposals “will help provide clearer language, shared governance criteria and minimum requirements for communicating corporate climate efforts in authentic, credible ways,” said Isabel Hagbrink, director of global communications at South Pole, a climate strategy and solutions company.
“This, we hope, will in turn help inspire greater and more genuine corporate climate ambition,” Hagbrink told CNBC via email. “Given that we are well into our decade of action and climate scientists have once again sounded the alarm, we simply cannot afford to have anyone – especially big business leaders – ‘green hush’ on their climate work,” she added.