Consumers are placing more value on sustainability which is great news for the planet. It’s also a great opportunity for your brand. Research shows that 32% of consumers are now highly engaged in adopting a more sustainable lifestyle. Brands that communicate their green credentials successfully, will take the majority share of this growing demographic.
One of the biggest issues with sustainable messaging is greenwash. A study conducted by the UK Competition and Markets Authority (CMA) found that 40% of green claims could be misleading. That’s a big problem. The CMA’s Green Claims Code aims to tackle this, making it easier for brands to stay within the law and make sustainable claims in a transparent way.
What is Greenwash?
Greenwash is anything put forward by a brand that claims to do more for the environment than it really does. Greenwash can be explicit, like when a product claims to do something for the environment that it doesn’t. It can also be more complicated. Such as when a product claims to be carbon neutral but the brand hasn't considered the full life cycle of the product.
Why is Greenwash a problem?
Greenwash makes it harder for brands that have made genuine commitments to sustainability to get noticed.
It misleads consumers who buy products or services that don’t deliver on what was promised.
It can damage customer trust in a brand and customer loyalty.
As of January 2022, it can be cause for court proceedings to be brought against your company.
What is the Green Claims Code?
The Green Claims Code is the CMA’s answer to greenwash.
The code is not a law itself. It is accessible guidance in the form of 6 principles. These principles help navigate the actual laws around the trading standards on sustainability and it's the best guide brands have for staying the right side of the law.
💡 The official laws are the Consumer Protection from Unfair Trading Regulations (2008) and Business Protection from Misleading Marketing Regulations (2008).
What does the Green Claims Code say?
The code has 6 principles:
Be truthful and accurate
Be clear and unambiguous
Not omit or hide important information
Only make fair and meaningful comparisons
Consider the full life cycle of the product
Be substantiated
For more detail on what these principles mean you can follow this link.
What does this mean for my brand?
The Green Claims Code came into effect in January 2022. There will be a settling-in period where brands have the chance to adapt to the code. The CMA will then review the advertising claims in industries most rife with greenwash. At this point, if a claim made by your brand violates the code, you could face an investigation.
The CMA, Trading Standards, or the Advertising Standards Authority can bring court proceedings to your brand over claims that violate the code. In some cases, brands may need to compensate consumers for breaching consumer protection law if found to be in breach.
The opportunity for brands
Instead of seeing the code as something that is trying to catch brands out, it should be seen as an invaluable tool in reaching a growing demographic of environmentally conscious consumers. There is an opportunity for brands to connect with consumers successfully on this topic and do so in a way that both alleviates the concerns of the consumer and protects your company from the consequences of greenwash.
For more detail on the principles of the Green Claims Code you can follow this link.