Report Urges Regulators to Ban Deceptive ‘Green’ Claims That Do Not ‘Mean Anything’

An empty recycling can made of plastic. Brendan Smialowski/AFP via Getty Images

Australian regulators should ban misleading “green” claims like “clean,” “bio,” and “for the planet,” a new report says.

The Consumer Policy Research Centre (CPRC) “Seeing Green” report found that 40 industries, led by the energy sector, make misleading environmental claims in social media ads. Household products, fashion, health and personal care, and travel contribute to the trend.

It was unclear if claims were about the product, packaging, or merely just the shipping box, causing customer confusion.

“Overall, it was clear that most green ads are vague, unhelpful, and unclear,” CPRC deputy chief executive Chandni Gupta told ABC News.

“It’s really hard to put two products side by side that have used the same green claims and be confident that they’re offering the same thing.”

She explained the ten most common green claims, including clean, green, sustainable, bio, recyclable, pure, and eco, “don’t necessarily mean anything.”

“It could mean that the product packaging is recyclable, not the product itself. It could even mean that just the shipping box it arrives in is recyclable,” she said.

She added the correct information could be found on company sites, “but that’s too much of a burden on the consumer.”

“Australians deserve protections that stop poor-quality green claims from being advertised. The onus needs to be put back on businesses to provide information that’s clear, consistent and comparable,” she noted.

The report took a deep dive into over 20,000 impressions of more than 8,000 Facebook ads with green claims. It explored the sectors making the most claims and the frequency of generic environmental terms, colours, and emojis used in green advertising.

Existing laws show that vague environmental claims can be deemed legal, even if they confuse consumers and lead to adverse environmental consequences.

Therefore, the Australian Competition and Consumer Commission (ACCC) is drafting guidelines for environmental and sustainability marketing claims in Australia, which are expected to be finalised before the end of the year.

Meanwhile, the European Union announced a ban on “generic environmental claims” in ads unless they were accompanied by recognised proof.

The Severity of Greenwashing Practices

ACCC Deputy Chair Catriona Lowe said a recent internet sweep revealed 57 percent of businesses in Australia make misleading environmental or sustainability claims.

“This is a concerning figure,” she said.

“In particular, for businesses reviewed in the cosmetics industry, 73 percent made concerning claims,” she added.

She said 66 percent of clothing and footwear businesses made concerning claims followed by 66 percent of food and drink businesses, which typically mislead consumers about recycling.

“In competitive markets like the food and drink sector, the ACCC has seen environmental claims, particularly those relating to recyclability, being used by businesses to influence a consumers’ decision-making process on what brand or product to choose,” she said.

Therefore, she said regulations were about making businesses do the right thing.

“What we are looking for is accuracy in the impression that an environmental claim creates for consumers,” she said.

“Ultimately, it comes down to businesses wanting confidence in making environmental claims and consumers wanting to be able to trust these environmental claims.”

Exploring the Causes Behind the Rise of Greenwashing

University of Melbourne Professor Christine Parker, one of the authors of the CPRC report, highlighted a significant incentive issue for businesses to make claims.

“Recent Consumer Policy Research Centre research shows 45 percent of Australians always or often consider sustainability as part of their purchasing decision-making. At least 50 percent of Australians say they are worried about green claim truthfulness across every sector,” she said.

She mentioned that due to consumer worries, businesses are highly motivated to make their operations more environmentally friendly.

However, she said this also gives them a solid reason to exaggerate their environmental claims.

She pointed out that exaggerated claims about biodegradable, compostable, or recyclable products can be problematic because while they may be technically accurate, they are often challenging for consumers to implement.

“Some products labelled biodegradable may need to be taken to a specific facility, but a consumer might assume they will biodegrade in their home compost bin,” she said.

Additionally, she noted ads promoting “sustainable” travel often highlight destinations connected to nature but fail to clarify which aspect of the trip is sustainable.

Therefore, she was on board with Australian regulators having the power to blacklist green terms that cannot be proven and are meaningless or misleading.

Concerns Mount Over Prolonged Regulations

Ms. Parker also expressed concerns that developing and implementing new Australian Consumer Law information standards to fix the problem would take several years.

“Australians cannot wait years for enforcement action against potentially misleading green claims. The economy and the digital world is moving too fast and the need for sustainability is too urgent,” she said.

“Governments must enact laws now to ensure green terms are clearly defined and based on the truth.”

Otherwise, she said widespread use of these claims could delay meaningful action on tackling issues like climate change, as it diluted the sense of urgency around the issue.

She clarified that greenwashing not only increased costs for consumers, as products claiming to be greener are often more expensive, but it also had broader environmental costs.

“False and exaggerated green claims—or “greenwashing”—make it seem more is being done to tackle climate change and other environmental crises than is really happening,” she said.

Ultimately, she said Australian consumers deserve green choices that truly tackled environmental issues.