UK and EU greenwashing regulations: what do you need to know?
So, we’re in a climate crisis. And most businesses are becoming more aware of their contribution and trying to understand how they can operate more sustainably. Many newer brands have always put sustainability at the heart of their business. But with this comes a temptation to overstate our impact. Hey, businesses are run by humans, and we want to shout about the great things we’re doing!
But sometimes this over-optimism (or cynicism in some cases) can lead to greenwashing, so greenwashing regulations have sprung up to prevent businesses from overstating their impact – intentionally or unintentionally. In this blog post, I unpack what greenwashing is and explore regulations in the UK and EU so you can ensure you stay on the right side of the law.
What is greenwashing and why is it a problem?
Greenwashing is when a company makes untrue or misleading statements about the environmental performance or impact of its business, product or service. And of course, this is a bad thing, because it lets companies get away with making minimal or non-existent changes for the good of people and the planet. And it slows down real progress on the issues causing climate change.
We’re most familiar with examples of big fossil-fuel-hungry corporations exaggerating their positive (or downplaying their negative) on the environment.
What are some examples of greenwashing?
Let’s take Ryanair for example. In 2020 one of their ads boldly claimed it was Europe’s lowest-emissions airline. This appeared to be based on the fact it was investing in newer aircraft with lower emissions and helping its customers offset carbon (a questionable practice at best). Complainants pointed out the obvious - by their very nature, airlines are far from low emission. The Advertising Standards Authority saw through its green haze and swiftly banned the ads.
That’s a blatant example. But it’s not always so obvious. Common greenwashing tricks include:
Fake, self-declared or unregulated certifications. In 2020, the European Commission found that 53 % of examined environmental claims in the EU were vague, misleading or simply untrue.
Fluffy words. We may have got used to terms like ‘green’, ‘eco-friendly’ and ‘sustainable’ and think we know what they mean. But the truth is there is no legal definition for these terms and often they’re used without any evidence to back them up.
Green visuals. Green packaging featuring images of nature might look gorgeous. However, it can also mislead consumers into thinking a product has a positive impact on the environment.
Shifting the responsibility to the consumer. Did you know BP invented the carbon footprint as a way of deflecting responsibility for the climate crisis away from oil giants and on to individuals? You can also see this in products that proudly claim to be 100% recyclable rather than addressing bigger systemic issues.
Greenlighting. Distracting our attention away from major environmental damage by showcasing minor eco-friendly efforts such as introducing paper straws.
Overstating impact. It’s surprisingly common for companies to make misleading claims about its impact on the environment.
Curious to learn more about how to spot greenwashing in the wild? I loved The Greenwashing Green by John Pabon, which explores the many facets of greenwashing. It includes some very surprising examples of greenwashing. Fake third-party or self-declared certifications.
Is greenwashing always intentional?
Which brings me to my next point. Greenwashing isn’t always intentional. It’s not always the remit of big, polluting businesses that want to pull the wool over their customers’ eyes. Even brands promoting more sustainable lifestyle alternatives can fall foul of greenwashing regulations by overstating claims.
I’m going to make a guess you’re one of the ‘good guys’ and not out to dupe anyone. You’re a conscious marketer, trying to do the right thing. But even with good intentions, unintentional greenwashing can happen. But no business is perfect. So knowing the various greenwashing laws, regs and guidelines in your region can help you avoid this trap.
What UK greenwashing regulations do you need to know about?
If your business operates in the UK, you’ll need to keep three major regulations on your radar: the FCA’s anti-greenwashing rule, the ASA’s Environmental Claim’s CAP and BCAP Codes, which cover all types of broadcast, print and online advertising and the CMA’s Green Claims Code.
The FCA’s Anti-Greenwashing Rule (May 2024):
This rule applies to FCA-authorised financial companies in the UK, including banks, investment firms, and insurance companies. To comply, you’ll need to make sure any references to the sustainability of your product or service is fair, clear and not misleading. This includes:
Making sure your claims are clear and can be easily understood. For example, it should be clear which product or service any carbon emission claims relate to, rather than implying the claim refers to all products. Similarly, don’t use a green colour palette and images of nature to simply suggest your product or service has a more positive impact on the environment than it does.
Not omitting important information. For example, if you claim your product is carbon neutral, you must consider its entire life cycle, including product and disposal, and not just the carbon it produces whiles being used.
Ensuring any comparisons are fair and meaningful. Are you comparing scope 1 emissions to scope 1, 2 and 3 emissions of another product?
You can read the rule in full here.
The ASA’s Environmental Claims Codes
The Environmental Claims Code applies to all types of advertising in the UK and emphasises transparency and fairness. The guidance includes:
Ensuring any claims are clear and substantiated. Don’t use terms not everyone will understand. You must back up any claims such as ‘carbon-neutral’ or ‘recyclable’ with clear evidence, such as certifications or third-party audits.
Justifying ‘fluffy’ terms. You CAN claim your product or service is ‘greener’ or ‘friendlier’ than the competition, but you’ll need to justify this.
Considering the lifecycle. Don’t cherry-pick the most sustainable parts of your product to distract from its overall impact.
Basing any environmental claims on scientific fact. If the scientific community is divided then best not to claim it.
Not falsifying improvements. If your product has never had a negative impact on the environment, you shouldn’t imply that it’s now more eco-friendly. Similarly, if your product doesn’t include a certain ingredient or process that it shouldn’t (perhaps because it’s a banned ingredient like microbeads) then don’t advertise it. This can dupe customers into thinking it’s more eco-friendly.
Several high-profile ads have been banned, including Virgin, Luton Airport and BMW.
The CMA’s Green Claims Code (2021)
Another greenwashing regulation you need to be aware of is the Competition and Markets Authority’s (CMA) Green Claims Code. The code applies to any product or service sold to a UK customer, even if the business is overseas. The content is very similar to the ASA’s code, but broader in scope because it applies to marketing as a whole rather than just advertising. It stipulates that:
Claims must be truthful and accurate.
Claims must be clear and unambiguous.
Claims must not omit or hide important relevant information.
Comparisons must be fair and meaningful.
Claims must consider the full lifecycle of the product or service.
Claims must be substantiated.
Companies breaking the code will be fined.
They also have a handy quiz to test your knowledge of the code.
What EU greenwashing regulations do you need to know about?
What if you’re selling in the EU? The Greenwashing Directive 2024 and the Directive on Empowering Consumers for the Green Transition (approved in January 2024 and expected to come into force soon) aim to clamp down on misleading claims. The directive bans practices including:
Early obsolescence, where an advertiser makes out a product is durable but it’s in fact designed to be prematurely obsolete.
Generic terms such as ‘eco-friendly’, ‘ecological’, and ‘biodegradable’.
Unaccredited sustainability labels.
Unsubstantiated claims about the future sustainable performance of a product.
Deceiving consumers into believing a product is more sustainable than others on the market by advertising irrelevant features. For example, if alternatives are plastic-free, you shouldn’t use this as a claim.
Claiming to be carbon neutral if you use carbon credits or offsetting (Sustainable X has a great blog about this problematic term).
The use of environmental claims that simply reflect compliance with a legal requirement already in place;
Environmental claims made in respect of an entire product or business that only apply to a specific aspect of the product, or specific activities carried out by the trader.
Failing to back up claims with reliable data can lead to legal penalties.
How can you avoid accidentally greenwashing?
The key to avoiding breaking greenwashing regulations by mistake is to be as transparent as possible and back up any claims with evidence.
Avoid terms like ‘carbon neutral’ or claiming your product produces less carbon than your competitors if you can’t back it up. This may mean you need to add more detailed info to your packaging, or direct customers to a dedicated website where they can find out more via a QR code.
Similarly, I would avoid fluffy terms like ‘eco-friendly’ or ‘green’. Not only do they mean different things to different people, they’re so generic they won’t make your brand stand out.
Third-party labels such as Fairtrade, the Leaping Bunny and Rainforest Alliance are really helpful, but make sure you do your homework before going through the certification process.
Third-party audits can help you identify areas you’re doing well and what can be improved. Be prepared to provide documentation and be subject to checks by regulators to verify the truthfulness of the claims.
Be transparent about your wins and where you can do better. Progress is better than perfection and can strengthen consumers’ trust in your brand. Many companies are sharing this on a dedicated ‘sustainability’ page on their website.
Finally, a word on greenhushing
While more regulation around greenwashing is a good thing, unsurprisingly these rules have led to a new phenomenon: greenhushing. Afraid of getting it wrong, many companies are keeping schtum on some of their brilliant sustainability initiatives.
Not only does this suppress great storytelling opportunities and a chance to connect with values-driven customers, it also holds back progress. If businesses perceive their competition to not be acting on climate change, they may feel like they don’t need to either.
So, my advice? Make sure you know your greenwashing regulations, be transparent, and show your audience how you’re making a difference- and own any shortcomings. It shows you’re doing your best.
Want to work with a copywriter who can help you steer clear of greenwashing? Get in touch with me for a chat about how I can help.
