- Caroline Lang /
- Insight /
- 11-01-22 /
- SHARE
6 things you should know about the new Green Claims Code
This month, the Competition and Markets Authority’s ‘Green Claims Code’ came into effect, holding businesses accountable for their environmental claims.
An environmental claim is a statement that suggests that a product, service, process, brand or business is better for or has a reduced negative impact on the environment. The claim can be implicit or explicit and can appear in any type of marketing material or advertisement, as well as branding (including business names, straplines, and logos!) and packaging. A green leaf on a yoghurt tub, a bank’s carbon neutral ambitions, a shampoo bottle with the word ‘recyclable’ on it or an airline flying on ‘sustainable aviation fuel’ are all environmental claims.
However, businesses omitting information or making green claims without proper evidence are now increasingly at risk of falling into the greenwashing trap. A recent CMA survey found that 40% of green claims made online could be misleading to consumers while the Advertising Standards Authority has already banned several ads – from Ryanair to Alpro to Hyundai – due to inaccurate sustainability claims.
With drastically growing numbers of consumers looking to engage with brands and products that have a positive impact on the environment, the demand for transparency is here to stay. In fact, our recent consumer trends report lists ‘Glass Box Brands’ and ‘Unconsumed’ as two of the biggest behavioural changes facing the world of business in 2022, with consumers keeping tabs on their favourite brands to reflect their environmental values inside and out.
In order to help businesses avoid misleading consumers and comply with the law, the CMA has created a set of 6 practical principles, applicable to both B2C and B2B brands. We’ve taken a look at what that might mean for you:
#1 Green claims must be truthful and accurate
The first principle simply means that a claim must not imply something which is factually incorrect or exaggerates the positive impact of a product or service. For example, a product is only really ‘recyclable’ if it doesn’t contain parts that prevent recycling. Equally, something can only be ‘organic’ if the entirety of the product matches that description. Businesses should also take note that a claim relating to standard industry practices or legal requirements, such as the mandatory exclusion of microbeads, for example, can mislead consumers into thinking the product is better than others, or than the norm, when in fact it’s just adhering to basic rules.
A good way to avoid inaccurate claims is by giving consumers all relevant information they might need to make an informed choice. The more you can elaborate, the better. If your brand’s pair of socks is made from 50% organic materials, it should be stated as such, while also listing any other materials used in manufacturing.
Fashion brand H&M has come under fire more than once for misleading claims about its environmental impact. According to Changing Markets Foundation, H&M’s Conscious Collection was found to contain a higher proportion of synthetic fibres than its fast-fashion line.
#2 Green claims must be clear and unambiguous
In other words, your claim should be fool proof. You can avoid confusing consumers by using careful wording that is transparent and straightforward. Businesses should steer clear from scientific or technical language unless it is easily understood by the average consumer. Be sure to include clear definitions where such key words are necessary. Vague terminology like “environmentally friendly”, “sustainable” or “green” can be equally misleading without further explanation, so it’s best to focus on more specific wording to explain your environmental impact.
#3 Green claims must not omit or hide important or relevant information
It’s not about what you say, it’s about what you don’t say. Consumers need information to make an informed choice, so it is vital for businesses to include details about all aspects of their product or service. A disposable cup labelled ‘compostable’ which requires an industrial composter to biodegrade could violate the Green Claims Code. To avoid being misleading, the cup should include further information regarding how and where it can be composted.
The key to ticking this box is to avoid cherry-picking information. Say your business is investing 10% more in electric vehicles but you haven’t disclosed that you are also investing 40% more in diesel cars – then you are omitting key information that could mislead consumers. If the negative impact doesn’t make the positive impact look any better, it’s best to avoid making your green claim in the first place.
Alpro’s ‘good for the planet’ strapline was challenged by the ASA for being misleading and unsubstantiated. The watchdog claimed it was too vague for consumers to understand.
#4 Comparisons must be fair and meaningful
Comparative claims should only compare like with like. They should be designed to enable consumers to make an informed choice about competing products or businesses and should not imply to be more environmentally friendly than the wider market if that is not the case. That’s why it’s important to only make a comparative claim if it is up to date and can be backed up by objective information.
If you are comparing your service’s CO2 emissions with a competing businesses’, for example, you’ll want to make sure you’ve calculated these measurements in the same way, presenting the results clearly for consumers to understand. That way you’re making clear what has been compared and how the comparison has been made. Win, win.
#5 Green claims must consider the full life cycle of the product or service
To make an environmental claim, it’s crucial to take into consideration the entire life cycle of your offer. Consumers are increasingly looking to understand more about materials, ingredients and disposal methods, so providing a holistic impression of the environmentally friendly processes you have put in place is a great way of ticking this box. You can still make a green claim related to a specific part of your advertised product’s life cycle or part of your business activities – just make sure you’re being clear about which aspect you are referring to.
Ryanair’s 2020 ad, claiming to have the ‘lowest carbon emissions of any major airline’, was removed by the ASA for using old data from 2011 and not including other well-known airlines in the comparison chart.
#6 Green claims must be substantiated
This is where your evidence comes into play. An environmental claim can often be linked to science and consumers are dependent on your advertising to provide them with this information. You should be able to back up your claims with relevant, up to do date and, most importantly, credible evidence. Businesses that don’t provide evidence to support their claims can be investigated by the CMA or other enforcers and brought to court. Your net zero or carbon neutrality targets should only be included if you can be clear about how you are actively reducing or offsetting your carbon emissions in a scientifically accurate way. If you’re making any green claim, just remember to do your due diligence!
At saintnicks, we’ve been working hard behind the scenes to ensure we’re all clued up when it comes to this new legislation. Drop us a line if you’d like to chat with us about the impact the Green Claims Code may have on your business in 2022.
For more information on the CMA’s Green Claims Code, click here.