What is the Green Claims Code?
The Competition and Markets Authority (CMA) has recently published the ‘Green Claims Code’ to outline guidance for businesses making environmental claims. The six principles apply to all businesses and covers environmental claims from advertisements, marketing material, branding, packaging and any other information provided to customers. Under the new guidance, green claims must:
- Be truthful and accurate
- Be clear and unambiguous
- Not omit or hide important information
- Only make fair and meaningful comparisons
- Consider the full lifecycle of the product
- Be substantiated
Green claims are used by businesses to market their products and services and can include statements, symbols, logos, graphics, colours and brand names to highlight their eco-friendliness. These claims will suggest that a product, service or brand is beneficial for the environment or less damaging to the environment than other competing goods or services. With growing pressure from government for businesses to reduce their environmental impact and consumers increasingly willing to pay more for environmentally friendly products and services, the rapid rise in green claims has created a noisy and confusing marketplace.
Environmental claims become misleading when businesses omit information or suggest a brand or product are less harmful or more beneficial to the environment than they really are. By applying misleading environmental claims to the promotion of their products, companies are able to appeal to environmentally conscious consumers, gain a competitive advantage and take customers away from products and services offering a genuine environmental benefit.
Although some businesses are already being clear and upfront about the environmental benefits of their product or service, this is not always the case. As public demand for sustainable products and services rises so does the temptation for companies to apply misleading environmental claims.
A recent review of websites promoting products and services across a range of sectors by the International Consumer Protection Enforcement Network (ICPEN) found 4 in 10 appeared to be using misleading green claims.
Consumers are becoming more aware of greenwashing practices, and a rising lack of trust in green claims has highlighted the need for greater transparency in ethical consumption. Businesses must now ensure their environmental claims are clear, accurate and reliable. Green claims must be backed up with robust, credible and up to date evidence and consider the total impact of a product or service to ensure they do not mislead customers.
What does this mean for iiE members?
The green claims code also applies to certification symbols. Using a symbol without providing information for customers to validate this can be considered misleading. Achieving accreditation through an independent scheme with strict objective standards and providing information alongside the symbol ensures consumers can verify a business meets the necessary standards.
When displaying an iiE accreditation logo, members should ensure customers can understand what the business has done to achieve the level accredited. This could be realised by linking the iiE accreditation logos to the environmental policy on the businesses website or publishing a sustainability report to show what has been achieved and what the organisation is working towards.
When a business displays their Bronze iiE accreditation logo, this means they have implemented an environmental management system and have shown commitment to reduce environmental impact through developing a system to monitor gas, electricity and water, as well as one other resource; calculated their carbon footprint; introduced a recycling system; taken part in a social/environmental project and established an action plan to look at reducing the consumption of each measured resource.
At Silver level these steps have been maintained with progress towards targets demonstrated and expanded to include a travel plan, the monitoring of two additional resources and at least two social/environmental projects.
For Green level, businesses have demonstrated progress towards the targets with an annual minimum 2% reduction in resource use, measured or taken part in at least three additional resources and social/environmental projects and started to include sustainability in the wider strategy of the organisation.
A full breakdown of what each accreditation level includes can be found here on the iiE website.
Full guidance on the CMA green claims code can be found here, with an explanation, examples and case studies for each principle.