Crackdown on greenwashing comes into effect
Sweeping consumer
protection laws have come into effect in the European Union, designed to clamp
down on greenwashing.
Under the Empowering
Consumers for the Green Transition Directive, also known as EmpCo, all
sustainability claims must be supported by third-party evidence, such as a
certification or government-backed label. These rules took effect on September
27.
Broadly speaking,
‘greenwashing’ is the practice of using deceptive marketing or misleading
claims to persuade the public that a company, product, or investment is more
environmentally friendly or sustainable than it actually is.
These laws affect
unsubstantiated claims commonly used in retail products, including jewellery,
such as ‘sustainable’, ‘green’, and ‘planet-friendly’. Certain claims, such as
‘carbon offsetting’ or ‘carbon neutrality’, are blacklisted.
Businesses operating
within the European Union have had several years to prepare for these
regulations, which were submitted in March 2024. That said, ‘greenwashing’ has
been a European Union focus for several years, highlighted by a 2020 study that
found more than 53 per cent of environmental claims about products sold in the
EU were unfounded.
“Until now,
investigations have been conducted at the discretion of individual EU member
states. While enforcement of the new rules will be controlled at a national
level, EmpCo provides a unified framework on what can and cannot be claimed,” a
Vogue report explains.
“Any brand selling
into the EU, whether European or not, must comply.”
“Unlike many incoming
regulations, which often have phased rollouts for different-sized businesses,
EmpCo will apply to all brands and products on the market from the end of
September. That means the same rules apply if you’re a billion-dollar retailer
with well-resourced legal and sustainability teams, or a small independent
fashion brand.”
These regulations also
address ‘partial claims’, and companies cannot market a product as
‘environmentally friendly’ if the benefit only applies to one part of the
product. A report earlier this year found that greenwashing may be a
billion-dollar issue in Australia.
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