The Green Claims Code: Part one - what is a green claim?
We’re in a global sustainability crisis; the way people we live is damaging our environment and changing our climate.
People want to help, and businesses are rushing to meet that desire. Unfortunately this means there’s a lot of greenwashing out there, as companies compete to present themselves in the most favourable light.
Take a stroll down any high street or supermarket and you’ll see thousands of products packaged with green labels, pictures of the earth, and endangered animals. On these boxes you'll read countless promises to do better by the environment. With so many products now marketed as "environmentally friendly" in one way or another, how are we supposed to judge which ones actually are?
In the UK, regulators have stepped in in the form of Competition and Markets Authority (CMA) and their Green Claims Code; guidelines for how claims of environmental benefits should be presented and evidenced, so businesses know how to communicate what they’re doing, and customers have less greenwash to wade through.
We pride ourselves on our environmental credentials at Naked Sprout, so we’ve recently reviewed our website, our packaging, and all of our communications to make sure everything is in line with the Green Claims Code. It’s been a really affirming process, and in this post and our next we'll be sharing what we’ve learned!
What is the code, where is it coming from, and why do companies (and consumers) need to know about it? Let's get into it.
Who are the CMA and what is the Green Claims Code?
The Competition Markets Authority (CMA) is a UK governmental body that regulates the market to ensure it’s competitive and isn’t unfairly dominated by monopolies. It is also responsible for making sure British people can make informed decisions for how they spend their money, without having the wool pulled over their eyes. If they find a business is behaving unethically or undermining fair competition they have the power to bring a court case on behalf of the public.
In guidance published in September 2021, they have defined what a green claim is, and how green claims should be presented to avoid greenwashing. So it’s more important than ever for businesses to make sure they are speaking honestly about how green they are, or aren’t. What are the kind of statements to look out for?
What counts as a green claim?
The definition of a “green claim” (also referred to as an “environmental claim”) is simple. When a business suggests that their products or services are better for the environment, they are making a green claim.
As you might guess, this covers a lot of products currently on the market. Anything that's being sold as a more environmentally-friendly, sustainable, or natural product counts. All those green labels and promises need to be backed up.
In theory, this shouldn't be too much to ask. Green claims are often different from standard marketing claims, because they generally refer to objective facts that can be studied and measured. If a DIY brand says that their paint makes a living room feel more homely, this is going to come down to personal taste. But if the same company says that their paint is “safer for aquatic life,” this is a statement about objective facts. They should be able to clearly define what they mean, and prove it.
And that's exactly what they will have to do. In order to be compliant with the Green Claims Code, every time a company makes a claim about the environmental credentials of their products or services they need to follow these points:
- 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
In our next post we'll get into more detail with some examples about the six core principles that the CMA wants companies to follow. But for now, let's talk a bit about what will happen if they don't.
How is the Green Claims Code enforced?
In 2021 the CMA published their guidance on green claims, encouraging UK businesses to start following their specific format to make sure the claims they were making about their products were compliant, and weren't likely to mislead customers.
We have already seen the impact of this guidance in fast fashion, an industry that is notorious for its environmental impact. In March 2024 large UK clothing retailers George at Asda, Asos, and Boohoo all agreed that they would not only prevent misleading or unclear claims being included on any of their products going forward, but that they would file regular reports to the CMA about their progress. Terms like "eco," "sustainable," and images like green leaves could only be used if they were accompanied with specifics, and evidence.
The agreement between the CMA and big clothing retailers marked an important milestone for the authority of the code, and from Autumn 2024 it will be given even more weight. The Digital Markets, Competition, and Consumer Bill, expected to come into force this Autumn, will give the CMA powers to impose a fine on companies in breach of the Green Claims Code, without having to take them to court. If companies are found to be in breach of the code, the fine can be up to 10% of global revenue.
All this means that for companies talking the talk on the environment, it's time to start walking the walk.
Up next...
That's our short summary of the Green Claims Code, what it includes, and why it matters for all UK businesses. At Naked Sprout we were delighted to see the Code given extra support in parliament, and we have reviewed all of our own claims to make sure we're not misleading, being vague, or omitting any information customers would want to know.
Next time we're going to get into the nuts and bolts of how to stick with the Code and sort the legitimate green claims from greenwash. If you want a sneak peak at what this looks like you can review all of the documentation we provide to support our sustainability credentials right here.
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