Australia’s consumer protection body is clamping down on ‘greenwashing’ after discovering more than 50 per cent of businesses made misleading claims about their environmental credentials.
Australia’s consumer protection body is clamping down on ‘greenwashing’ after discovering more than 50 per cent of businesses made misleading claims about their environmental credentials.
Last year, the Australian Competition and Consumer Commission conducted an internet sweep of 247 businesses and found that 57 per cent had made concerning claims about their environmental sustainability practices.
Of the industries surveyed, the majority of the misleading or unclear claims came from the cosmetic, clothing and footwear, food and drink sectors.
ACCC deputy chair Catriona Lowe said the outcome indicated a significant proportion of businesses were making vague or unclear environmental claims.
She said consumers were increasingly making purchasing decisions on environmental grounds.
“Unfortunately, it appears that rather than making legitimate changes to their practices and procedures, some businesses are relying on false or misleading claims,” Ms Lowe said.
“This conduct harms not only consumers, but also those businesses taking genuine steps to implement more sustainable practices.
"Businesses using broad claims like ‘environmentally friendly’, ‘green’, or ‘sustainable’ are obliged to back up these claims through reliable scientific reports, transparent supply chain information, reputable third-party certification or other forms of evidence."
Ms Lowe said the businesses in question would be asked to substantiate their claims.
“Already, we have several active investigations underway across the packaging, consumer goods, food manufacturing and medical devices sectors for alleged misleading environmental claims and these may grow, as we continue to conduct more targeted assessments into businesses and claims identified through the sweep,” she said.
“We will take enforcement action where it is appropriate to do so as it is critical that consumer trust in green claims is not undermined."
On February 28, the Australian Securities and Investments Commission announced it was launching its first court action against alleged greenwashing conduct.
The regulatory body was commencing civil penalty proceedings in the Federal Court against Mercer Superannuation for allegedly making misleading statements about the sustainability of its superannuation investment options.
ACCC also plans to run educational activities and update an economy wide guidance material.
"The sweep has helped inform our forthcoming guidance about what steps businesses need to take to improve the integrity of their environmental claims," Ms Lowe said.
"We will engage directly with businesses and industry associations to improve compliance with the Australian Consumer Law."
