A recent internet sweep by consumer watchdog ACCC has found that more than half of all businesses reviewed are making concerning claims on their packaging and websites about their environmental or sustainability practices.
The Australian Competition and Consumer Commission (ACCC) says it is going to begin an investigation after 57 per cent of the 247 businesses reviewed between 4 and 14 October last year were found to have provided misleading information regarding their environmental credentials.
The cosmetic, clothing/footwear and food/drink sectors were found to have the highest proportion of concerning claims. The cosmetics sector particularly stood out, with over 73 per cent of all companies raising concern.
As outlined in the ACCC’s Greenwashing by Businesses in Australia report released this week, the most common issue the sweep identified was that these businesses were using vague or unclear environmental claims, with many businesses using terms like ‘green’, ‘kind to the planet’, ‘eco-friendly’, ‘responsible’ or ‘sustainable’ to describe their products on packaging and other platforms.
ACCC says such vague terms are confusing to consumers as they provide no information quantifying these terms, and little to no evidence for the claims. In some cases, the companies may be making accurate claims, but without proper evidence provided, it is difficult to verify.
PKN spoke to Australian Packaging Covenant Organisation (APCO) CEO Chris Foley shortly after ACCC released its report. APCO is the custodian of the Australasian Recycling Label (ARL) and works with brand owners to help them provide robust substantiation of on-pack claims related to recyclability of packaging.
Foley said, “APCO welcomes the ACCC investigation into businesses making false and misleading environmental claims. When it comes to packaging recyclability and recovery, accurate labelling is critical to ensure that packaging gets disposed of in the right way – meaning valuable materials can be processed and used again, and preventing contamination in the waste stream.
“It is vital that any environmental claims are substantiated and verified to ensure consumers are able to trust what they see and read on their packaging. The Australasian Recycling Label, now present on more than 250,000 SKUs throughout Australia, provides that verification.”
Foley said APCO continues to work with businesses across the supply chain to help them make sustainable packaging choices and to communicate this clearly and effectively to consumers. He confirmed that over the last six months APCO has completed a strategic review on the ARL Program and is implementing a range of enhanced compliance and governance measures ensuring a transparent and robust process to support the ARL.
The ACCC report also highlighted a problem with green pledges. Companies were found to be setting environmental goals without clear plans for how these will be achieved. For example, some companies were found to be making claims about Net Zero targets, but with no clear explanation of what practical changes were being implemented to achieve these goals. In other cases, goals were very general and not able to be measured.
Many businesses also claimed affiliation with a variety of certification schemes, in ways which could be confusing to consumers, the report said. For example, some businesses were unclear as to what constituted ‘being certified’, sometimes giving the appearance that the entire company was certified, when in fact it may only be one small component of a product.
Widespread use of logos and symbols is also causing confusion. ACCC says some businesses apply logo-like graphics of leaves, greenery or the planet to their packaging and websites which appeared to be trust marks but were not associated with any certification scheme.
These claims were made in both product-specific claims and company-wide claims, and showed up on packaging, websites, advertisements or corporate social responsibility and reporting documents.
ACCC deputy chair Catriona Lowe commented, “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. 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.”
Lowe added: “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.”
