In recent times, the practice of greenwashing—making misleading and unsubstantiated claims about the environmental performance of products and services—has come under increasing scrutiny from regulators worldwide. Similar to the efforts by the Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC), the UK's Competition and Markets Authority (CMA) has been actively addressing this issue. A notable development in this area involves the CMA securing voluntary undertakings from major fashion retailers ASOS, Boohoo, and George at ASDA to ensure that they will make "only accurate and clear green claims."
Commitments Made by Retailers
The undertakings from these retailers include several key commitments aimed at enhancing the transparency and accuracy of their environmental claims:
- Accuracy and Clarity of Green Claims:
- All environmental claims must be precise and not misleading.
- Information should be communicated clearly, in plain language, and be prominently displayed.
- Specificity in Statements about Fabrics:
- Use specific terms like “organic” or “recycled” (where substantiated) instead of ambiguous terms like “sustainable,” “eco,” or “responsible.”
- Clear Criteria for Green Ranges:
- Retailers must explicitly set out the criteria for “green ranges” such as George at ASDA’s “George for Good.”
- Detail any minimum requirements, such as the percentage of recycled fibers included in the range.
- Plain Language and Visibility:
- Key information regarding environmental performance should be in plain language, easy to read, and visible to shoppers.
- Avoidance of Misleading Imagery:
- Retailers should refrain from using ‘natural’ imagery (e.g., green leaves) that might falsely suggest a product is more environmentally friendly than it actually is.
- Accuracy in Internet Search Filters:
- Search filters on retail websites should accurately reflect the environmental attributes of products. For instance, searches for “recycled” items should only show clothing predominantly made from recycled materials.
- Verifiable Environmental Targets:
- Retailers must have clear and verifiable strategies to achieve any stated environmental targets.
- Information on these strategies should be readily available to customers.
- Clarity on Accreditation Schemes and Standards:
- Companies should clearly indicate whether an accreditation applies to specific products or to their broader business practices.
Implications for Retailers in Australia
The undertakings provided by ASOS, Boohoo, and George at ASDA offer practical insights that can guide retailers in Australia. These insights are particularly relevant as the ACCC has also been active in this space, with its most recent legal action being commenced against GLAD bag manufacturer, Clorox. The ACCC accused Clorox of misrepresenting its GLAD Kitchen Tidy and Garbage Bags as being made from recycled ‘ocean plastic,’ supported by wave imagery and blue-colored bags. Clorox later revised the packaging to state “MADE USING 50% OCEAN BOUND PLASTIC.”
The ACCC’s legal action seeks various remedies, including:
- Declarations
- Penalties
- Injunctions
- Orders to implement a compliance program
- Corrective notices
- Costs and other orders
Conclusion
The recent actions by the CMA and the commitments from ASOS, Boohoo, and George at ASDA give Australian retailers some helpful guidance on how Australian regulators are likely to view environmental claims. Retailers must ensure their environmental claims are truthful, clear, and substantiated to avoid legal repercussions and maintain consumer trust. As regulators like the ACCC in Australia closely monitor these developments, retailers would do well to align their practices with these standards to mitigate risks and support genuine sustainability efforts.
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