Marketing your “green” credentials? Make sure they’re legally green

But retailers be warned – “green claims” by businesses (usually in the form of marketing or promotional language that claims that a product, service or business practice minimises harm to, or even has a positive effect on, the environment) have recently caught the attention of UK regulators who are demanding greater transparency and proper substantiation of green claims.

UK consumer protection law already prohibits unfair commercial practices by retailers. This includes a ban on false or misleading statements or omissions, which might induce a consumer to make a transactional decision they would not have otherwise made. Such practices are illegal and could potentially amount to a criminal offence. Given the increasing weight and influence of green claims in particular, the Competition and Markets Authority (“CMA”) has recently published a Green Claims Code to help ensure retailers and other business understand and comply with their existing obligations under consumer protection law in the context of making green claims.

The CMA’s view is that the effect of existing law is that businesses must ensure that their green claims:

• are truthful and accurate;
• are clear and unambiguous;
• do not omit or hide important information;
• compare goods or services in a fair and meaningful way;
• consider the full life cycle of the product or service; and
• are substantiated.

One key point set out in the Green Claims Code is that consumer protection law does not prevent retailers from making environmental and sustainability claims about their products and services, providing they do not mislead consumers.

With the CMA signalling an intention to more closely scrutinise environmental claims going forward (including a full compliance review of green claims in early 2022), retailers should take care to ensure that their green claims are truthful and can be properly substantiated before seeking to capitalise on the current sustainability agenda. At the same time, retailers whose products are genuinely ‘green’ should see this as an opportunity. The Green Claims Code not only helps businesses stay on the right side of the law but it also protects them from unfair competition and helps create a level playing field. In the end, this should benefit environmentally conscious consumers, as well as responsible retailers.

Authored by Helen McGowan, Micaela Bostrom, Georgia Hughes.