UK competition watchdog poised to use new robust enforcement powers to tackle greenwashing in F&B
The UK’s Competition and Markets Authority (CMA) is about to get new enforcement powers to crack down on misleading greenwashing claims on F&B products. The government watchdog can issue hefty fines to companies it sees as breaching regulations without going to court, under the new rules.
Firms making greenwashing claims and breaking consumer protection laws will be fined up to 10% of their global annual turnover under the updated laws, which are part of the Digital Markets, Competition and Consumers Act.
The CMA will oversee whether companies falsify or overstate a product, service, or brand’s green credentials.
As the F&B industry braces for the April 6 enforcement date, Changing Markets Foundation (CMF) talks to Food Ingredients First about “rampant” greenwashing claims in the F&B industry and how the new enforcement powers have been a long time coming.
“The UK’s CMA has been granted enhanced powers under the Digital Markets, Competition and Consumers Act 2024, enabling it to directly impose penalties on companies that breach consumer protection laws. This includes those making claims that fail to meet the six principles of the Green Claims Code, a straightforward checklist for companies making environmental claims,” Maddy Haughton-Boakes, senior campaigner, tells us.
“This means that food and beverage companies found to be ‘greenwashing’ could face substantial penalties, reaching up to 10% of the company’s global annual turnover.”
“We hope this serves as a strong deterrent to food industry players that continue to make misleading environmental claims to evade accountability.”
Getting away with greenwashing
Previously, the CMA had to seek court orders to enforce consumer protection laws, but with these new powers, it can act more swiftly and effectively against non-compliant businesses.
The CMA has issued guidance to help businesses ensure their environmental claims are truthful, clear, and substantiated, thereby avoiding potential penalties.
“The CMA’s guidance is clear: Companies cannot claim that a product is sustainable without taking into account the full life cycle of the product, nor can they make environmental claims that omit information about a product. Our greenwash monitoring shows failure to meet these simple rules is rife in the F&B sector.”
“With the CMA’s new powers coming into effect, we expect to see a significant drop in misleading environmental claims made by large food manufacturers and retailers,” Haughton-Boakes continues.
This crackdown and tougher penalties are long overdue. Despite the CMA publishing its Green Claims Code in 2021, food companies have been “getting away with rampant greenwashing for years,” she flags.
“In a rapidly heating world, where our global food system is responsible for one-third of climate emissions, companies must be held accountable for their contributions to the climate crisis. We hope that the CMA’s new powers will drive greenwashing companies to stop their misleading claims and shift toward making genuine, evidence-based commitments.”
Maddy Haughton-Boakes, senior campaigner at Changing Markets Foundation.
Confusing consumers
Greenwashing and misleading claims in F&B create confusion and skepticism in consumers, who are growing wary of unsubstantiated green claims on food.
“Rampant greenwashing in the food industry has left consumers navigating a maze of misleading and inconsistent environmental claims in supermarket aisles. UK shoppers have grown deeply skeptical of environmental labels on food products, even as many are willing to pay more for sustainable options,” says Haughton-Boakes.
“Research we conducted back in 2023 found that 42% of UK consumers were more likely to buy a product with a ‘carbon neutral’ label, and 29% were willing to pay slightly or much more for those products.”
“With companies found to be slapping questionable ‘carbon neutral’ claims onto items including beef and dairy products, it’s clear that consumers’ good intentions are ripe for exploitation. Tackling greenwashing is therefore not only crucial for addressing the climate crisis; it is key to rebuilding trust with consumers who want to make climate-informed food choices.”
Recent research from EIT Food shows that some consumers remain wary of sustainability claims on upcycled food products amid greenwashing practices and are unsure whether reducing waste in food production actually leads to a meaningful impact.
In January, the NSF (formerly National Sanitation Foundation) flagged that only 29% of UK adults believe that current food labels sufficiently address sustainability issues, flagging a “stark disparity” between consumer expectations and current labeling practices.
Meanwhile, in Europe, politicians are also getting stricter on greenwashing but are not pushing for the same powers as the UK’s CMA.
Last month, the European Parliament approved the new Directive on Empowering Consumers for the Green Transition. This directive aims to regulate and restrict ambiguous and deceptive claims made by companies about the environmental sustainability of their products. Once implemented, the directive is poised to affect stakeholders in the food and nutrition industry.
However, Dimitri Vergne, sustainability team leader at the European Consumer Organization (BEUC), told Food Ingredients First last year that they do not want “each and every company to be fined.” Instead, BEUC urges businesses to consider sustainability messaging and green claims carefully, with only those who “really are making an effort” making green claims.
“Vague environmental claims will be forbidden, meaning that companies will no longer be able to declare that they are ‘green’ or ‘environmentally friendly’ if they cannot demonstrate that they are. It will also be forbidden to display unreliable voluntary sustainability logos. In addition, unfair commercial practices linked to early obsolescence will be prohibited, such as false claims about the sustainability of an asset,” reads a European Commission statement.
