ACCC tracks environmental claims in textile and food sectors

Sheep Central, March 3, 2023

MORE than half the businesses surveyed for potential greenwashing were assessed as making concerning claims, the Australian Competition and Consumer Commission said yesterday.

And the sectors with the greatest proportion of concerning environmental claims were those in the cosmetic and personal care sector; followed by textiles, garments and shows, and; food and beverages.

The ACCC will not disclose the names of the 247 businesses reviewed during its sweep until its final report is made.

The ACCC will be investigating a number of businesses for potential ‘greenwashing’, following an internet sweep which found more than half of the businesses reviewed made concerning claims about their environmental or sustainability practices.

The ACCC said some businesses are using vague or unclear environmental claims, using third-party certifications and symbols in a confusing way, setting environmental goals without clear plans for how these will be achieved, and not providing sucient evidence for their claims.

ACCC deputy chair Catriona Lowe said the sweep indicated a significant proportion of businesses are making vague or unclear environmental claims.

“This warrants further scrutiny.”

“Consumers are now, more than ever, 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,” she 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.

“Where we have concerns, we will be asking businesses to substantiate their claims,” Ms Lowe said.

“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.

“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.”

The ACCC will also conduct a range of education activities with businesses, including updating economy-wide guidance material, in addition to targeted guidance for specific sectors.

“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 want to see businesses taking steps to ensure that environmental claims are accurate as well as meaningful for consumers.

“Our sweep has shown that claims are most useful where they are relevant, clear, reliable and transparent.”

She said the ACCC will engage directly with businesses and industry associations to improve compliance with the Australian Consumer Law.

“Importantly, we encourage businesses to come forward if they become aware they have made false or misleading marketing claims.

“Businesses who cooperate and advise of any issues with their operations, will be considered more favourably than those who wait for the ACCC to unearth these problems,” Lowe said.

The ACCC encourages consumers and businesses to contact the ACCC to report any potentially misleading environmental or sustainability claims. Report through the ACCC website or by contacting the ACCC Infocentre on 1300 302 502.

As part of the 2022-23 Compliance and Enforcement Priorities, the ACCC is prioritising consumer and fair-trading issues in relation to environmental and sustainability claims.

Under the Competition and Consumer Act (CCA), the ACCC can use powers under s155 of the Act to obtain information, documents and evidence in relation to matters which may constitute a contravention of the CCA. The ACCC can also issue substantiation notices requiring a person or business to give information and/or produce documents that could be capable of substantiating or supporting a claim or representation made by the person or business.


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