Using green claims – with minimal regulatory risk

NRA

In response to growing concerns regarding the use by industry of ‘green claims’ and more specifically ‘greenwashing’, the ACCC published in December 2023 a guide for business on Making Environmental Claims. The guide is comprehensive (almost 40 pages), and whilst it contains specific advice, it serves as a guide to all industry sectors.

As a service to members and the wider retail sector, the National Retail Association has developed and released a Best Practice Guide for Environmental and Sustainability Claims which augments and builds on the ACCC guide but with more specific advice relevant to retailers.

The guide was prepared under the direction and with the assistance of National Retail’s ESG (Environment Social Governance) Committee. The Committee, which meets 3 times a year, identified that the area of green claims is a regulatory minefield, and further advice, particularly for smaller retailers, would help businesses to navigate a path to making legitimate claims about their products or their company’s environmental credentials.

National Retail’s guide describes:

  • governance processes and key principles to be used when making green claims
  • the care needed when green claims are used with other marketing claims
  • specific do’s and don’ts of making green claims, and
  • numerous retail sector examples illustrating how to make claims which are truthful, and therefore regulatory compliant.

National Retail sought and received advice from the ACCC (Australian Competition and Consumer Commission) on the Guide. And while the ACCC cannot provide formal endorsements of industry guides, they were able provided positive feedback which was incorporated into the Guide.

Furthermore, in a presentation made to the ESG Committee at its recent meeting (23 July 2024), the ACCC stressed that it sees value in green claims as a means of market differentiation, as a driver of competition, and as an incentive to innovation to lowering the environmental footprint of individual businesses. Claims, however, must be truthful and evidence-based to ensure consumers are not misled, and companies do not compete unfairly in the market.

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