ACCC cracking down on greenwashing

Businesses have been warned they need to be able to substantiate any environmental claims they make in their marketing.

Australian Competition & Consumer Commission deputy chair Delia Rickard said there have been increasing reports of businesses falsely promoting green credentials to capitalise on changing consumer preferences.

“Broad terms like ‘environmentally friendly’, ‘green’ or ‘sustainable’ have limited value and may mislead consumers, as they rarely provide enough information about what that exactly means in terms of the product or service consumers are considering purchasing," she said.

“It is important that businesses can back up the claims they are making, whether through reliable scientific reports, transparent supply chain information, reputable third-party certification or other forms of evidence. 

"Where we have concerns, we will be asking businesses to substantiate their claims. The ACCC won’t hesitate to take enforcement action where we see that consumers are being misled or deceived by green claims."

ACCC wants to protect green businesses from unfair competition

Ms Rickard said the ACCC’s campaign against greenwashing was aimed, in part, at protecting innovative businesses.

“Many businesses go to extraordinary lengths to make their processes, products and services more sustainable,” she said.

“This innovation and investment should be protected from unscrupulous behaviour of other businesses making green claims without incurring the same costs. 

“This can have a chilling effect on investment in this space, as businesses are not able to realise the full benefits of making environmental improvements.”

Ms Rickard urged businesses to think from their customers' perspective when doing marketing.

“Consumers generally need to take at face value that claims made are truthful and accurate,” she said.

“While businesses may look to use short and snappy slogans and claims, rather than lengthy explanations of measures underway, it is important to convey accurate information to consumers."