Greenwashing and Greta
Don’t make an environmental claim about your product or company unless it can pass the Greta Test. Photo by Kushal Das via Wikipedia.
Companies have been keeping an eye on two greenwashing proposals coming out of Brussels this year. One has passed and one has not. Here is what is happening with the Green Claims Directive (GCD) and the Empowering Consumers for the Green Transition (ECGT) rules.
There seems to be a pattern of reducing sustainability rules in the EU recently. Corporate sustainability reporting is being cut back via the coming CSRD update, and now rules against deceptive environmental marketing are “on pause”, to use the polite terminology.
When it comes to greenwashing, there are two different proposals in which companies should be aware. The Empowering Consumers for the Green Transition (ECGT) set rules on environmental claims while the Green Claims Directive (GCD) was to explain how claims could be verified. The plan was for the GCD to require science-based verification, labelling schemes and third-party verification.
The GCD isn’t dead, but it isn’t breathing
The European People’s Party felt the GCD was too burdensome, particularly towards microenterprises. The main problem was the requirement for third-party verification of environmental claims, which could be expensive and time-consuming. Negotiations were paused and Italy has withdrawn support for the proposal.
The Commission has clarified the GCD has not been formally withdrawn, but its status is uncertain. This occurred close to the end of Poland’s presidency of the EU, so they passed the problem on to Denmark to worry about.
There is nothing specific about the GCD in Denmark’s programme for their presidency, although they pledge to cut back on the complexity of regulations. It is fair to wait and see if the GCD will be revived, but at this point it is flatlining and companies should treat it as such.
The ECGT is alive and well
However, the GCD was only one part of the anti-greenwashing agenda. The ECGT has been passed and companies must be compliant by September 2026. This updates the Unfair Commercial Practices Directive and the Consumer Rights Directive.
(Note the ECGT pertains to more consumer protections than greenwashing, such as software updates, planned obsolescence and the right to repair. I will only discuss greenwashing here.)
The ECGT updates the other directives to prohibit some specific acts, including:
1. Displaying a sustainability label that is not based on a certification scheme or established by public authorities.
2. Making generic, unproven environmental claims.
These are vague claims that suggest good environmental performance without providing any reliable proof, such as:
- environmentally friendly
- eco-friendly
- green
- nature’s friend
- ecological
- environmentally correct
- climate friendly
- gentle on the environment
- carbon friendly
- energy efficient
- biodegradable
- biobased
- conscious
- sustainable
- responsible
These are not black-listed terms; they are merely used as examples when a claim might need to be verified. For example, it is perfectly appropriate to use the term ‘energy efficient’ if a product meets the requirements set out in the energy labelling directive.
3. Making an environmental claim about the entire product or business when it concerns only a certain aspect of the product or business.
The rules give some examples:
- Claiming a product is ‘made with recycled material’, giving the impression that the entire product is made of recycled material, when in fact only the packaging is made of recycled material.
- When a company suggests it is only using renewable energy when in fact it uses multiple sources, including fossil fuels.
4. Claiming that offsetting greenhouse gas emissions makes a product neutral, reduced or positive to the environment.
These claims are allowed only when they are based on lifecycle impact assessments of the product, and not based on offsetting emissions outside the product’s value chain. The update gives a few terms to be wary of in this context:
- climate neutral
- CO2 neutral certified
- carbon positive
- climate net zero
- climate compensated
- reduced climate impact
- limited CO2 footprint
5. Presenting requirements imposed by law as a distinctive feature of the product or service.
The example they give is:
- Advertising a product as not having a specific chemical, when that chemical is already forbidden by law.
What would Greta say?
What’s next? The ECGT already includes independent third-party verification, such as for forward-looking environmental statements, but with the GCD in a coma it isn’t clear how this will work in practice. If nothing else, companies should fall back on the existing rules against deceptive marketing and use their best judgement. If you aren’t sure about a claim, ask yourself what Greta Thunberg would say.
This is a rule of thumb I suggest for clients sometimes. Once I was in a meeting with executives from a major Nordic company who had contracted me to write an article for them. They wanted a rather eyebrow-raising environmental claim in their story. I suggested they ask themselves the following question.
What would Greta Thunberg say if she read this? Would you be happy with an environmental activist such as her discussing your claim in front of the media?
The executives looked at each other and changed their minds.
Sometimes the simplest solutions are the best. If your environmental claim won’t pass the Greta test, then maybe you shouldn’t claim it.
Want to talk green?
I can help you to stay compliant with changing sustainability reporting requirements, communicate what’s important, and find added value in the process.
info at davidjcord.com
