Redefining Green Claims to Better Protect Consumers

As governments and society try to move towards a more environmentally friendly and sustainable future, many claims about products or company’s sustainability have emerged. The multiplicity of claims & labels and the lack of framework to verify them have led to a growing mistrust of consumers toward labeled goods. Many environmental claims today are widely considered not reliable and consumer trust has fallen to an all-time low.

But not only consumers are lost with these many labels, so are the companies ! It has become very challenging to make sense of the environmental & sustainability claims companies could use : what would make sense for their products and market, how they can verify it and not fall into greenwashing. Even well-minded companies can sometimes make marketing mistakes when it comes to green labels as rules are unclear. 

This has prompted the European Commission to introduce a new set of legislation on green claims in an attempt to address greenwashing and better protect consumers and the planet. 

Starting with basics : what are green labels ? 

Green labeling refers to the practice of placing an environmental label on a product or packaging to indicate that it has been produced using environmentally friendly methods or materials, or that it meets certain environmental standards. The purpose of green labeling is to provide consumers with information about the environmental impact of the products they buy and to encourage them to make informed purchasing decisions in terms of environmental sustainability.

All environmental labels and declarations are regulated by the environmental management tools covered by the ISO 14000 series.

There are various types of green labels that may be used for different purposes, for examples:

• To indicate it has been produced from renewable energy sources, 
• To certify that a product is free from harmful chemicals or that it has been manufactured using sustainable materials
• To provide information about the carbon footprint of a product or its overall environmental impact.

Green labeling is often used in conjunction with certification schemes, such as the Forest Stewardship Council (FSC) or the Marine Stewardship Council (MSC), which set standards for sustainable forestry and fishing practices, respectively. These labels and certifications help consumers make more informed choices about the environmental impact of the products they buy and can also incentivize companies to adopt more sustainable practices.

What is the issue ? 

According to a European Commission study, 53% of green claims provide vague, misleading, or unfounded information. Furthermore, they found that half of the green labels offer weak or non-existent verification and 40% of claims have no supporting evidence at all. While a lack of supporting evidence is poor for consumers, even legitimate certifications can be difficult for consumers to understand as there are no standard definitions, meaning that, depending on the Member State or product type, these certifications could mean vastly different things in practice. 

The European Commission found that across the EU there are roughly 230 different sustainability labels and nearly 100 green energy labels with considerable differences in their levels of transparency.

These misleading claims and lack of transparency have led consumers to either ignore these claims, leading them to be ineffective, or to be misinformed and therefore potentially rewarding the wrong brands.

The EU looks to empower consumers for a green future

The European Commission pledged in the European Green Deal to make sure that consumers have the power to make better decisions and actively participate in the ecological transition. More precisely, the European Green Deal outlines a commitment to combat false environmental claims by ensuring that consumers receive trustworthy, comparable, and verifiable information. The Commission believes that this will help them make more sustainable decisions and lessen the risk of “greenwashing.” Furthermore, the New Consumer Agenda and the New Circular Economy Action Plan both established greenwashing as a top priority. The necessity of giving consumers the freedom to make decisions based on transparent and trustworthy information on the sustainability, toughness, and carbon footprint of the products is further reiterated in the newly adopted Green Deal Industrial Plan.

The new regulation is designed to offer an uniform framework for evaluating how products affect the environment and supporting claims like “100% recycled” or “all-natural.” The initiative is a part of the EU’s rapid implementation of legislation, which also includes rules on packaging waste and the ability to repair phones and laptops to promote more sustainable consumption across the union.