Have you heard about greenwashing? Naming a product or organisation sustainable, while this isn't true. This is misleading consumers and other stakeholders. In order to prevent greenwashing, and regulate green claims made by companies, the European Union proposed the Green Claims Directive (GCD). The GCD is an initiative on substantiating green claims, by obliging companies to stack their sustainability claims up with evidence. Facts and figures, or data-driven sustainability as we call it at Hedgehog Company.
Let's provide some context
As a consumer, deciding on what product to buy in the supermarket isn’t easy. You have your favourite brands, obviously, but what about sustainability.? Do you take this aspect into account here as welll? When provided with the choice between two products, and one claims to be sustainable, nowadays more and more consumers opt for the sustainable product. But can you really trust these so-called green claims?
This increasing awareness is also evident for business, where producing sustainable products is increasingly becoming economically interesting. Hence, a lot of companies start to actively communicate about their sustainability efforts. However, soon companies cannot just say anything. An initiative is underway on substantiating green claims.
What is the Green Claim Directive?
The Green Claims Directive (GCD) is a regulation proposed by the EU and it's aim is to establish clear and consistent rules for environmental claims made by companies. The directive covers a range of topics such as carbon footprint, recyclability, and biodegradability. It is expected that companies will have to start be compliant from the end of 2024 on.
The GCD requires companies to provide:
- Scientific evidence to support their claims
- Ensure that the claims are accurate, verifiable, and not misleading
- Green labels should be based on established certification schemes
The Green Claims Directive would also establish a standardized system of labelling that would allow consumers to easily understand the environmental impact of a product or service. The labelling system would be based on a set of criteria developed by the EU, and companies would need to meet these criteria to be eligible for the label.
In addition to regulating environmental claims made by companies, the Green Claims Directive would also establish penalties for companies that violate the regulations. Companies found to be making false or misleading claims could face fines or legal action.
What are green claims?
Just as some brands claim their product is ‘sugar-free’ or ‘made of certified (FSC) wood’, they can also make claims on sustainability. Claims on the environmental performance of products are called green claims.
It's important to be cautious with green claims communicated by brands. This is because they can be misleading or exaggerate the environmental benefits of their products. To ensure that a product is truly environmentally friendly, look for third-party certifications and do research on the brand's sustainability practices. Vague or dubious statements, for example, could indicate greenwashing.
A few examples:
- "Eco-friendly" or "sustainable" products: Many brands claim that their products are eco-friendly or sustainable, but these claims are not always substantiated. Such claims are really generic and make the product seem to be more environmentally friendly than they actually are.
Real example: H&M adopting ‘green’ clothing line Conscious Clothing, turning out to be not so conscious.
- "Green" packaging: Some brands claim that their packaging is made from recycled or sustainable material. However, the overall environmental impact of packaging goes beyond just the materials used, and brands may not consider other factors like energy usage in manufacturing or transportation.
- "Carbon-neutral" or "carbon-offset" products: Some brands claim that their products are carbon-neutral or carbon-offset, meaning that they have offset the greenhouse gas emissions generated by their production or transportation. However, the effectiveness of some carbon offset programs is disputed, and it allows companies to keep doing business as usual.
Real example: Shell rebranding as contributor to green transition, but in fact most of the investments go to fossil fuels.
- "Natural" or "organic" ingredients: Brands may use terms like "natural" or "organic" to imply that their products are safer or better for the environment. However, these terms are not regulated and can be used in misleading ways. Additionally, natural or organic ingredients are not necessarily always better for the environment, as they may require more land, water, or energy.
Greenwashing and the Green Claims Directive
Greenwashing is a term used to describe the practice of companies making false or misleading claims about the environmental benefits of their products. Looking at the previous examples, companies often make exaggerated or vague (or sometimes even false) claims about their product’s sustainability. They do this in order to make their products seem more sustainable than they actually are.
Greenwashing is problematic since it can mislead consumers into thinking they are making environmentally responsible choices, when in fact they are not. It can also undermine the efforts of companies that are genuinely committed to sustainability by making it harder for consumers to distinguish which products and practices are truly environmentally friendly.
Sustainability regulation trends
Fortunately, we see some positive trends that tackle greenwashing. Here’s an overview:
- Increasing awareness among consumers. Consumers start to become more aware of vague claims.
- Increasing regulations on sustainability. Regulations like the Green Claims Directive (GCD) and Digital Product Passport (DPP) make sure data on sustainability becomes more robust and transparent.
- Increasing demand for transparency in supply chains. In order to make the right choices, both consumers and producers demand transparency on the materials and products they buy.
How to prepare for the Green Claims Directive
In order to avoid penalties for making false or misleading claims, here are some steps that you can take to prepare for the GCD and make trrue sustainable claims:
- Review and revise current claims. Review your current environmental claims and assess whether they comply with the Green Claims Directive.
- Use established standards. Use established environmental standards, such as ISO, when making environmental claims. These standards provide clear guidelines for measuring and reporting on environmental impacts, and are more likely to be accepted by regulators.
Life cycle assessments (LCA) and carbon footprints are established methods that measure the environmental footprints of products. These methods are based on standards like ISO 14040, 14044 and 14067. Need help? We are here to guide you. - Provide clear evidence. Substantiate every claim, by including data on energy usage, greenhouse gas emissions, and waste reduction, as well as third-party certifications or audits.
Evidence comes in many forms. Methods like LCA and carbon footprints come in standardized reports. Furthermore, an Environmental Product Declaration (EPD) can be developed, following ISO 14025. This is an official document that disclosed your product’s environmental footprint.
