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Cleaning up environmental claims

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United Kingdom

The competition watchdog, the Competition and Markets Authority ("CMA") is investigating the use of "eco-friendly" claims and their impact on consumer purchasing decisions.

Climate change and the world's impact on the environment is a growing concern for many. As global awareness of environmental issues increases, so does the public's desire for "green" products.

Consumers are becoming much more environmentally conscious when buying goods and services. In turn companies are increasingly looking to reduce their carbon footprint and provide goods and services that are friendlier to the environment from manufacturing processes, to packaging and claims. Everyone wants to be contributing to a greener planet. However, in their attempts to do so, there is a risk that companies might be using exaggerated and misleading claims in their marketing communications.

We recently reported on the Advertising Standard's Authority's (ASA) ruling against Quorn for misleading claims that it's Quorn Thai Wonder Grains product could help reduce Quorn's carbon footprint. Despite Quorn having a clear carbon footprint protocol and certification in place, the ASA upheld complaints on the basis that Quorn had omitted key information from the basis of these specific environmental claims.

As well as this ruling, the ASA has upheld a number of complaints regarding environmental claims, such as "carbon neutral", "zero carbon emissions", "offsetting/reducing carbon emissions" and "eco-friendly" and now the CMA has also raised its own concerns about the accuracy and trustworthiness of environmental claims.

This week, the CMA announced that it will be investigating the use of "eco-friendly" claims to see if they could be misleading consumers. This is a part of the CMA's annual plan to support a low carbon economy.

What are the primary concerns?

There is an increased concern that to feed the public's demand for "green products" and to win this target audience, companies may be drawn into making exaggerated, complex, misleading, vague or false claims about the sustainability or environmental impact of their products and services.

Why does it matter?

Consumers should be able to trust the environmental claims that they see in relation to products and services and not be misled into paying higher prices as a result of false or misleading environmental claims.

What does the investigation involve?

The CMA will be:

  • covering a wide range of sectors, but focusing on key areas of interest to consumers like fashion and textiles, travel and transport and fast moving consumer goods (beauty, cleaning products and food and beverage);
  • looking at descriptions, labels and claims for products and services to see the types of claims being made; whether they are capable of substantiation; if advertisers are failing to provide relevant information and/or misleading the public;
  • considering the impact of claims on consumer purchasing decisions;
  • looking to see if consumer protection law has been broken;
  • seeking input from the public on what they expect from "eco-friendly" products, how often they come across green claims and how it impacts their purchasing decisions; and
  • consulting with charities, organisations and businesses to understand the issues.

What follow up steps will the CMA be taking?

The CMA will be issuing guidance for businesses in summer 2021. The guidance will urge businesses to be transparent in their claims and may include additional points of action depending on the CMA's findings during its investigation. The CMA will also advise the government based on its findings.

What should you be thinking about and doing?

If you would like to contribute to the discussion you have until 14 December 2020 to provide your input to the CMA. There are separate surveys for consumers, businesses and other interested parties.

In the meantime, while the investigation is underway and until the CMA issues its next summer, it would be prudent for advertisers to carefully consider the environmental claims that they make in relation to their products and services and ensure that their claims are:

  • accurate and true;
  • not exaggerated;
  • clear and easily understandable to consumers (no jargon);
  • include all relevant information forming the basis of the claim;
  • supported by evidence;
  • not misleading through logos, packaging or other implied claims.
If you require any further information in relation to this area please don’t hesitate to get in touch with our Advertising & Consumer protection practice.

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