Greenwashing crackdown: EU plans to outlaw misleading environmental claims on consumer packaged goods

22 Sep 2023 --- The EU is combating greenwashing and setting higher standards for companies that make vague, partial or false claims about their environmental impact. The new directive, “Empowering Consumers for the Green Transition,” will strengthen consumer protection by banning misleading advertising. It is predicted to have an impact on the F&B industry, which is filled with products and innovations claiming to be “carbon neutral” or something similarly “green” or “eco-friendly.”

The law, approved by the EU Council and EC, still needs formal approval by the European Parliament and each of the EU27 country national parliaments. If all parties greenlight the initiative, it will come into force in 2026.

According to Ursula Pachl, deputy director general at the European Consumer Organisation (BEUC), the future ban on carbon neutral claims is “great news” for consumers. 

“There is no such thing as ‘carbon neutral’ or ‘CO2 neutral’ cheese, plastic bottles, flights or bank accounts. Carbon neutral claims are greenwashing, plain and simple. It’s a smoke screen giving the impression that companies are taking serious action on their climate impact,” she highlights.

“The truth is that these claims are scientifically incorrect and should never be used. We are delighted to see that the EU has seized this legislative opportunity to ban carbon neutral claims.”

Furthermore, the new legislation will impose stricter rules for further environmental performance claims, which will only be allowed if they include a realistic implementation plan, feasible targets and if independent third-party experts regularly review them.

“The new EU rules will enable consumers to navigate through a sea of green claims” according to Pachl.Nonetheless, as we explored in this week’s special report, the F&B industry is aware of regulatory shifts relating to sustainability and greenwashing. 

“Jungle of green claims”
Terms like “carbon neutral,” “energy efficient,” “green” or “biodegradable” will need to be proved and backed by evidence. 

“Generic environmental claims are popping up everywhere, from food to textiles. Consumers end up lost in a jungle of green claims with no clue about which ones are trustworthy,” Pachl says.

A recent EC study assessed 150 environmental claims and found that a “considerable share” (53.3%) of them provide vague, misleading or unfounded information on products’ environmental characteristics across the EU.

“Thankfully, the new rules are putting some order in the green claims’ chaos. Companies will have to explain why a product is environmentally friendly. This is crucial if we are to guide consumers to make more sustainable consumption choices,” she explains.

Similarly, the new scheme will ban sustainable labels not based on certification schemes or established by public authorities. The new ban might help end the myriad of so-called eco-labels being rolled out across various F&B products, which can confuse consumers.

The EU initiative comes after Foundation Earth achieved a milestone for eco-labeling harmonization in May by bringing public and private initiative together in France.

Moreover, the Changing Markets Foundation noted that a ban will put a lot more pressure on suppliers to justify their claims and possibly send them into “greenhushing” mode to avoid the risk of misleading claims.Terms like “carbon neutral,” “energy efficient,” “green” or “biodegradable” will need to be proved and backed by evidence.

Choosing durable products
The new legislation will provide further information obligations on repairability and software updates and a new harmonized guarantee label informing about the durability of products. It will also prohibit business practices that shorten product lifespans.

“The new EU rules will enable consumers to navigate through a sea of green claims and choose durable products that live up to expectations,” Pachl says.

According to the EC, 80% of EU consumers claim to have difficulty in finding information on how easy it is to repair a product.

“Consumers have a crucial role to play in the green transition, so it’s good news they will have more information to make sustainable choices when buying food, new clothes or home appliances,” adds Pachl.

“The rules could make more durable products more competitive and incentivize consumers to invest in quality rather than quantity.”

Innova Market Insights identified “Green but clean” as a top packaging trend this year. The market intelligence leader flagged that environmental claims like “carbon impact,” “reduced packaging” and “plastic-free” on F&B packaging have almost doubled (92%) since 2018.

But the proliferation of sustainability messaging has created fears of unsubstantiated claims.

By Marc Cervera