In a recent promotion in Sri Lanka, an FMCG company offered a free gift labeled as an "Environmentally Friendly Product" with every purchase. However, the product was sealed in a package that didn't allow potential buyers to physically examine it. It was only after making the purchase that the writer discovered the product was made from a composite material of 50% straw and 50% polypropylene. This composition posed challenges for recycling, meaning the product would likely end up in a landfill or as plastic debris on beaches. This raises concerns about the validity of labeling it as an "environmentally-friendly product." Unfortunately, the consequences faced by the company for this misleading claim are expected to be none.
This is a classic example of "Greenwashing," where unsubstantiated or misleading claims are made about the environmental benefits of a product, service, or company policy. Greenwashing often involves spending more on advertising "green" claims than on actual environmentally sound practices. One famous instance is ExxonMobil Chemical falsely labeling their 'Hefty' trash bags as biodegradable by adding starch, leading to a lawsuit and subsequent removal of the term from their packaging and advertising. Another example is BP's $200 million campaign to rebrand themselves as environmentally friendly with the slogan "Beyond Petroleum".
To establish credibility, green claims should adhere to specific, measurable, and product-relevant criteria, verified by a third-party certification body. These principles align with the Federal Trade Commission's 2012 Green Guides, which offer guidance on green marketing. The guides now emphasize the importance of certifications and seals of approval, promoting the need for specific claims and disclosure of the certification body's relationship with the company. Third-party verification helps prevent exaggeration, misleading information, and other pitfalls associated with greenwashing when companies self-certify their products. Certification bodies bring in-depth expertise on the standards they certify, surpassing the surface-level knowledge that product manufacturers may possess.
The US Federal Trade commission gives the following guidance to companies to avoid green washing
With regard to certifications, the FTC’s (https://www.ftc.gov/tips-advice/business-center/guidance/environmental-claims-summary-green-guides) Endorsement Guide state:
- Marketers should not make broad, unqualified general environmental benefit claims like "green" or "eco-friendly." Broad claims are difficult to substantiate, if not impossible.
- Marketers should qualify general claims with specific environmental benefits. Qualifications for any claims should be clear, prominent, and specific.
- When a marketer qualifies a general claim with a specific benefit, consumers understand the benefit to be significant. As a result, marketers shouldn't highlight small or unimportant benefits.
- If a qualified general claim conveys that a product has an overall environmental benefit because of a special attribute, marketers should analyse the trade-offs resulting from the attribute to prove the claim.
- Claiming "Green, made with recycled content" may be deceptive if the environmental costs of using recycled content outweigh the environmental benefits of using it.
In today’s context, there are some significant benefits of independent certification
- Marketers should disclose any material connections to the certifying organisation. A material connection is one that could affect the credibility of the endorsement.
- Marketers shouldn’t use environmental certifications or seals that don’t clearly convey the basis for the certification, because the seals or certifications are likely to convey general environmental benefits.
- To prevent deception, marketers using seals or certifications that don’t convey the basis for the certification should identify, clearly and prominently, specific environmental benefits.
- Marketers can qualify certifications based on attributes that are too numerous to disclose by saying, “Virtually all products impact the environment. For details on which attributes we evaluated, go to [a website that discusses this product].” The marketer should make sure that the website provides the referenced information, and that the information is truthful and accurate.
- A marketer with a third-party certification must still substantiate all expressed and implied claims.
Author: Sanith de Silva Wijeyeratne
Sanith is the Director & CEO of The Climate & Conservation Consortium (CCC) With extensive experience and expertise in Corporate Sustainability, he has been instrumental in shaping CCC into one of the leading advocates for sustainability in the region.
The Climate and Conservation Consortium (CCC) plays a crucial role in addressing the challenges associated with estimating Scope 3 emissions in the apparel sector. As a consortium dedicated to climate and conservation initiatives, the CCC offers expertise, resources, and collaboration opportunities to tackle environmental issues, including greenhouse gas emissions.
- They function as an indicator of the company’s commitment.
- They provide an opportunity to identify process inefficiencies and implement best practices.
- They are an external verification of the internal workings of a company that will highlight potential problem areas that may not be evident to the internal workforce.
- They become a control mechanism for the company’s management.
- They are a reassurance to the consumer that the product has enhanced environmental credentials.