ACCC's Draft Guidelines to Thwart Greenwashing

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by KnowESG
KnowESG_ACCC's draft guidance to rein in greenwashing
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The ACCC has taken a significant step to enhance the credibility of environmental and sustainability claims made by businesses while safeguarding consumers against deceptive practices known as 'greenwashing'.

In response to the ACCC's recent investigation, which revealed that 57 per cent of surveyed businesses were potentially misleading consumers with their environmental claims, the organisation has published draft guidance aimed at rectifying such behaviour.

According to ACCC Chair Gina Cass-Gottlieb, businesses must be transparent and truthful in their environmental or sustainability claims, especially as consumers become more environmentally conscious.

False or misleading claims erode consumer trust, particularly when individuals are willing to pay higher prices based on these assertions. Furthermore, genuine businesses that adopt sustainable practices are put at a disadvantage when competing against those that engage in greenwashing without incurring the same costs.

To assist businesses in making accurate environmental claims and fulfill their obligations under the Australian Consumer Law, the ACCC has outlined eight practical principles in its draft guidance. Adhering to these principles reduces the likelihood of misleading consumers and violating consumer protection regulations.

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Clear, accurate, and trustworthy information, substantiated by evidence, should be provided to consumers regarding any environmental or sustainability claims. Ms. Cass-Gottlieb says that businesses should refrain from making claims if they are uncertain or unable to substantiate them.

The ACCC is inviting feedback from various stakeholders, including businesses, consumers, and other interested parties, on the draft guidance.

They are particularly interested in understanding if the proposed guidelines improve businesses' confidence in making legitimate environmental and sustainability claims and if any concerning green claims have been observed.

Feedback from consumers regarding how businesses can provide useful and accurate information regarding green claims is also highly encouraged. This collaborative approach aims to create a framework that enhances transparency, trust, and accuracy in environmental claims.

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Source: ACCC


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