How to know your environmental claims are up to standard
Much attention is being given to the environmental claims that businesses make when marketing their products and services. As demand for eco-friendly products skyrocket, in the UK alone, one third of consumers want to shop responsibly by choosing more environmentally friendly products and services.1 By exploiting consumer’s genuine ethical concerns, greenwashing impacts a consumer’s ability to make a sound environmentally friendly decision – generating confusion, scepticism and increased perceived risks around ‘green products.’ As stakeholders are increasingly exposed to the material risk of greenwashing, how are the businesses that are responsible held to account?
There are many statements made about the environmental and sustainable credentials – nicknamed green claims – of products in advertising, packaging, and other marketing materials. Getting these wrong is bad for business, bad for consumers and bad for the planet. That’s where we, whether consuming as an individual or on behalf of an organisation, need assistance to better understand and trust green claims. In September 2021, the Committee of Advertising Practice launched the Green Claims Code. The principles are designed to highlight the standards that businesses need to adhere to when making claims about their environmental impacts.
The rules are simple, claims must:
- Be truthful and accurate
- Be clear and unambiguous
- Not omit or hide important and relevant information
- Be fair and meaningful when comparing to competitor
- Consider full life cycle of product or service
- Be substantiated.
So, what do these six principles set out for businesses and who is affected?
The code helps businesses understand and comply with best practice around marketing and advertising. By supporting the Advertising Standards Agency (ASA), the code enforces new guidance on misleading and socially irresponsible environmental claims. By delivering clear and explicit instructions, the entire lifecycle of a product, service, process, or brand is covered by the code. A tough route for a business to navigate when faced with the current macroenvironment of supply chain issues, inflation and rising cost of living impacting a volatile labour market.
Beyond the legal penalties for failing to comply, neglecting these six principles risks separating a company from their customer base. And as informed public opinion and expectations rapidly evolve, a company’s reputation is increasingly exposed to this danger. Over a 12-month period, the ASA found 16 advertising campaigns had either exaggerated their company’s green credentials or made unsubstantiated environmental claims. 2 Major companies caught up in this scandal included Innocent Drinks, Oatly and Alpro.3 Other household names such as Amazon, Ikea and Unilever were among companies to be exposed to fall short of promises that reach net-zero by the middle of the century.3 Showcasing the increased stakes of marketing credibly, with action by regulators such as CMA set to grow.
As trust in green claims is fragile, the Green Claims Code is a welcomed intervention that will play a vital role in levelling the playing field. Bridging the gap between marketing and sustainability requires a big shift in mindset. Businesses that have been doing the work to mitigate their social and environmental impact – with data to support – will see the code as a golden opportunity to gain commercial advantage and improved performance.
At Simply Sustainable, we support the current trends of increased transparency in disclosures and can guide you to comply with existing obligations on environmental claims.
2 Independent. Number of adverts banned for ‘greenwashing’ triples in a year.
3 The Guardian. Biggest net zero claims.
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