The CMA will investigate descriptions and labels used to promote products and services claiming to be ‘eco-friendly’, and whether they could mislead consumers.
This new programme of work is a response to the growing number of products and services being marketed as environmentally friendly, as awareness of environmental issues increases. In 2019, UK consumers spent £41 billion a year on ethical goods and services – almost 4 times as much as people spent two decades ago.
Based on its own research and evidence from other enforcers, the Competition and Markets Authority (CMA) is concerned that this surge in demand for green products and services could incentivise some businesses to make misleading, vague or false claims about the sustainability or environmental impact of the things they sell.
Examples of misleading behaviour could include:
- exaggerating the positive environmental impact of a product or service
- using complex or jargon-heavy language
- implying that items are eco-friendly through packaging and logos when this is not true
As part of its work, the CMA will also consider whether failing to provide all relevant information about the sustainability of a product or service – for example, whether it’s highly polluting or non-recyclable – could mislead consumers and therefore break consumer law.
The CMA is looking across a wide range of sectors, although it is likely to focus on those industries where consumers appear most concerned about misleading claims, including textiles and fashion, travel and transport, and fast-moving consumer goods (food and beverages, beauty products and cleaning products).
The CMA wants to better understand the impact of green marketing on consumers, in line with the commitment made in its annual plan. The CMA is therefore calling on the public to have their say on what they expect from eco-friendly products, how often they come across green claims, and how these claims affect their purchasing decisions. The CMA is also consulting with charities, businesses and other organisations to get a clearer picture of the issues in this area.
Following these discussions, the CMA intends to publish guidance for businesses next Summer to help them support the transition to a low carbon economy without misleading consumers. At this early stage, the CMA has not reached a view as to whether or not consumer protection law has been broken. However, if it finds evidence that businesses are misleading consumers, then it will take appropriate action.
Andrea Coscelli, Chief Executive of the CMA, said:
“Increasing numbers of people are quite rightly concerned about the environment and want to play their part by being greener. Our role is to make sure that consumers can trust the claims they see on products for sale and don’t fork out extra for items falsely presented as eco-friendly.
“We know that many businesses will be looking for ways to reduce their carbon footprint and we strongly support this, but the claims they make must not mislead consumers in the process. It’s important that people can easily choose between those who are doing the right thing for the environment and those who are not, so that businesses genuinely investing in going green can be properly rewarded by their customers.”
Although UK marketing practices will be the focus of the CMA’s examination, the CMA is also taking a leading role in looking at green claims in a global context. Work will be carried out alongside the Dutch Authority for Consumers and Markets, as part of a project with ICPEN (the International Consumer Protection and Enforcement Network). From 9 to 20 November, the CMA will co-ordinate a ‘sweep’ of randomly selected websites with ICPEN members, with the aim of identifying the types of misleading green claims being made around the world.
All updates on the CMA’s work in this area can be found on the misleading environmental claims case page.