13th January 2022

Red flags on greenwashing

As the fight against climate change ramps up, trading standards will need to be increasingly on its guard against misleading ‘greenwashing’ claims by business, says Laura Kane

By Laura Kane
Policy Executive, CTSI
There is the risk that trading standards could get overlooked in the process of budget allocation if decision-makers don’t see its  importance in reaching Net Zero in a fair and equitable manner

Government’s Net Zero carbon strategy sets out policies and proposals for decarbonising all sectors of the UK economy to meet its target by 2050. This has implications for consumers and business, and therefore local authority trading standards services, as the UK navigates a sea of changes in consumer choice. The Government has committed to “work with the grain of consumer choice”, which is positive; however, effective regulation of Net Zero initiatives and products will be required to ensure they are fit for purpose and true in what they say they will do. Consumers and business also need to feel supported and empowered in choosing products and services within the green economy.

Green claims can be complex and confusing to decipher to say the least. I myself have consulted the Consumer Council website many times to work out which energy supplier was the cheapest. I’ve also felt the knee-jerk reaction to try and pick greener products, relying only on what I read on the label or website. More recently I have found the CMA’s Green Claims Code for Shoppers really useful. My mindset has changed and I am starting to shop local as much as I can. I am questioning my avocado consumption and thinking: are all those airmiles really worth it?

This would tend to reflect the current trend within the consumer landscape, in which consumers are becoming more motivated to purchase green products and services. A Deloitte study this year found that 34% of 2,000 adults surveyed look for brands with strong sustainable credentials.

Exploiting good intentions

As well as the difficulty navigating legitimate adverts, trading standards professionals over the years, myself included, have seen a wealth of green-related criminality which preys upon consumers’ desires to protect the environment and their health, or to save money on energy. From illegitimate charities, scams and copycat websites to solar panel firms taking ownership of roofs and fake organic pistachios bringing €6m (£5.1m) in profit for organised crime, the complexity and confusion and detriment that can be caused by green claims means that effective regulation is needed to level the playing field in the green economy and help consumers and businesses feel confident in their green choices.

An International Consumer Protection and Enforcement Network (ICPEN) review this year, which the CMA jointly led, found that 40% of claims made online could be misleading. This included vague claims and unclear language including terms such as ‘eco’ or ‘sustainable’, or reference to ‘natural products’ without adequate explanation. Own-brand eco logos and labels were not associated with an accredited organisation. Information was also hidden or omitted in efforts to make products appear more eco-friendly – no doubt causing Regulations 5 and 6 of the Consumer Protection from Unfair Trading Regulations to pop into the head of the trading standards professional reading this.

This raises the question of what can be done about green claims against a backdrop of inadequate resources. We know that investigation of misleading green claims can be complex, time-consuming and prohibitively expensive to investigate, even by the most well-resourced trading standards service.

To reduce the need for such enforcement and to support the UK economy, businesses will need help to comply when making green claims and there have been moves within the consumer landscape to provide some clarity. BSI’s PAS 2060 verifies claims around carbon neutrality. The CMA’s Green Claims Code for business sets out guiding principles, legal explanations and day-to-day examples which businesses can consult when making green claims to consumers or to other businesses. Sectoral regulators can also produce rules for the utility companies they regulate. The Advertising Standards Authority (ASA) can take action for misleading green claims which appear in advertising and has already had a number of high profile rulings. A local business will still expect support from its local trading standards service and CTSI is aware from dialogue with our business stakeholders, that businesses are actually missing
the presence of trading standards within their communities.

It is clear that trading standards has a role at a local and national level in supporting the Net Zero agenda, which no doubt now features as a key driver within local authority work plans and targets. There is the risk that trading standards could get overlooked in the process of budget allocation if decision-makers don’t see its  importance in reaching Net Zero in a fair and equitable manner.

CTSI is already engaging and will continue to engage with Government to ensure trading standards has a seat at the table in the agenda as the UK Builds Back Better. Demonstrating the relevance of trading standards within this agenda (despite there not being enough resources yet to fully carry out all that is currently and will be required) is a vital part in campaigning for extra resource. CTSI recently published a ‘Squash the Greenwash’ infographic as a sharable resource to help local authorities demonstrate this relevance.

CTSI is looking into the chasm of what is not getting done currently due to the lack of trading standards capacity across the UK and what the risks to consumers and businesses are as a result. We will also be looking at what is coming down the line for trading standards in the green space as we continue to push for additional resources. We are also keen to put a spotlight on the value for money trading standards already provides as we know that where possible, trading standards services are already operating within this space.

If you or your authority is investigating green claims, or doing any green projects, please get in touch; as with COVID-19-related work, we know that authorities will be making innovative use of the resources available and we would very much like to hear about it.

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