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Navigating the greenwashing frontier: ACCC guidelines for environmental claims
With growing awareness about the importance of environmental protection, consumers are increasingly seeking out eco-friendly and sustainable products and services. However, this has seen the rise of a phenomenon known as "greenwashing" where businesses exaggerate or mislead consumers about their environmental efforts.
To protect consumers from deceptive practices and ensure businesses adhere to responsible environmental claims, the Australian Competition and Consumer Commission (ACCC) has recently published draft guidance. Read our recap below for more on the ACCC's efforts to improve businesses' environmental claims and promote transparency, trust and responsible consumption.
Understanding greenwashing and its impact
Greenwashing is a deceptive marketing strategy used by businesses to give the impression that their products or services are environmentally friendly when in reality, they might not be. This misleading practice can lead consumers to make purchasing decisions based on false information, resulting in a negative impact on the environment. It also negatively impacts businesses that are genuinely investing in sustainable practices, as they face unfair competition from those making false environmental claims.
ACCC's greenwashing internet sweep
To address the growing concern of greenwashing, the ACCC conducted a greenwashing internet sweep in late 2022, analysing environmental claims made by businesses. The results were concerning, with 57 percent of the reviewed businesses found to be making potentially misleading environmental claims. This highlighted the urgency of implementing measures to protect consumers and create a level playing field for businesses committed to sustainability.
ACCC's draft guidance: Eight principles for trustworthy environmental and sustainability claims
In light of the findings of the greenwashing internet sweep, the ACCC released a draft guidance document. The main objective of this guidance is to promote integrity in environmental and sustainability claims made by businesses and prevent the spread of misleading information. The draft guidance outlines eight practical principles for businesses to follow when making environmental claims:
Impact on consumers and businesses
The ACCC's draft guidance aims to empower consumers by providing them with accurate and trustworthy information to make eco-conscious choices. Consumers can now scrutinise businesses' environmental claims more effectively and choose to support those with genuinely sustainable practices. Moreover, businesses adhering to the guidance will enhance their reputation and gain a competitive advantage over those engaging in greenwashing.
The ACCC's draft guidance on environmental claims represents a significant step towards combating greenwashing and promoting responsible consumption in Australia. By adhering to the eight principles outlined in the guidance, businesses can build consumer trust, foster sustainability and create a greener future. As the consultation for the draft guidance continues, it is essential for businesses, consumers, and stakeholders to provide feedback and actively contribute to the integrity of environmental claims in the market.
Take action now!
If you want to learn more about greenwashing, its impact on consumers and best practices to identify genuine environmental claims, visit the ACCC website. There, you'll find insightful examples of greenwashing and valuable resources to help you make informed decisions as a responsible consumer or business owner.
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Greenwashing: ACCC publishes draft guidance to protect consumers
Eight practical principles businesses should apply when making environmental claims. The draft guidance sets out what the ACCC considers to be good practice when businesses make environmental claims about their products and services as well as making them aware of their obligations under the Australian Consumer Law.