Get Versed in Recent Changes in Green Claims Code

Guidelines to ensure your business's green claims are credible 

To verify the accuracy of a business's environmental statements, a new set of guidelines has been established to assuage increased pressure for businesses to prove their sustainability claims. With spreading awareness of terms like greenwashing and green hushing in the business world, more companies are being held accountable for incorrect sustainability reporting. 

A growing issue of inaccuracies in sustainability reporting has led to a rise in greenwashing, as per a 2021 report from the Competition and Markets Authority (CMA). It revealed that 40% of firms globally had made misleading environmental claims. To combat this, the CMA has introduced a new set of guidelines aimed at improving transparency in sustainability reporting and reducing confusion around related language and requirements.

What is covered by the Green Claims Guidelines?

The Green Claims Code from the CMA provides concise guidelines for sustainable claims, aimed at maintaining transparency and avoiding accusations of greenwashing. The six key points are as follows:  

• claims must be truthful and accurate
• claims must be clear and unambiguous
• claims must not omit or hide important relevant information
• comparisons must be fair and meaningful
• claims must consider the full life cycle of the product or service
• claims must be substantiated 

What implications does this have for my company? 

Adherence to the Green Claims Code helps businesses provide accurate environmental reporting and avoid false sustainability claims, which can attract criticism. The CMA has outlined a clear set of guidelines for businesses to follow, which also serves as a reference tool for external entities to identify greenwashed claims. 

Supporting sustainability claims with solid evidence can help validate them. To do this, the evidence must be current-day, relevant, and trustworthy, and it should directly tie to the product or service the claim pertains to. Widely known claims about a material's positive environmental impact that are not the direct responsibility of the business should not be included. 

Making ungrounded general claims without supporting evidence, such as eco-friendly, green, or sustainable, can result in greenwashing. For instance, a brand's claiming that their product is eco-friendly due to using a recyclable material, if they contribute to pollution through its long-distance shipping, would not accurately reflect the brand's eco-friendliness. 

Lastly, any false claims made in the name of sustainability are prohibited by the CMA's Green Claims Code. Fabricating positive environmental impacts, such as attributing outcomes that have no connection to a business's practices, is not acceptable. Any standard or legally required aspects of a product or service cannot be advertised as environmental advantages as they are required by law instead of being an outcome of deliberate choices made by the business. 

For more information on environmental, financial and social aspects affecting businesses and available support across Greater Manchester, you can choose to attend our upcoming events, check out our resources or ask for personal support from our specialist advisors. 

This material is based on original article published by Green Economy.