ACCC Releases Draft Guidance For Business – Environmental Claims
Today’s consumers are more environmentally conscious when it comes to their purchases. One crucial factor they consider is the environmental and sustainability claims made by businesses.
However, for these claims to truly resonate with consumers, they must be honest, accurate, easy to understand, and properly qualified. False or misleading claims not only misguide consumers but also put genuine businesses at a disadvantage.
That’s why the ACCC (Australian Competition and Consumer Commission) has recently released a draft guidance document to help businesses navigate the world of environmental claims and avoid Greenwashing.
This guidance aims to encourage businesses to provide transparent information about their products and services, particularly about any environmental claims made. By doing so, this empowers consumers to make informed choices.
It’s important to note that whilst these are guidance notes complying with the ACCC’s guidelines is essential, as businesses have obligations under the Australian Consumer Law (ACL) to avoid making false or misleading representations.
If you didn’t already know the ACCC’s focus is on investigating conduct that harms the competitive process, misleads consumers, or causes widespread consumer or small business detriment.
So, how can your business ensure compliance and navigate this terrain successfully? Let’s take a look at the eight key principles summarised below, derived from the ACCC Guidance Paper. If you’d like to dive deeper, you can find the full guidance document at the provided link.
Principle 1: Accuracy and Truthfulness
Ensure that all claims are accurate and truthful. Even if a claim is factually correct, it should not create a misleading overall impression. Represent the genuine environmental impact without exaggerating benefits or scientific acceptance.
Principle 2: Supporting Evidence
Have clear and credible evidence to support your claims. Independent and scientific evidence is highly regarded. Make sure consumers can access the research, evidence, or data to understand and trust your claims. For claims about the future, ensure you have reasonable grounds to support them, as baseless claims are misleading.
Principle 3: Full Disclosure
Provide consumers with all relevant information needed to make informed decisions. Avoid hiding important information or placing it where it may go unnoticed. Transparency regarding environmental impact is crucial.
Principle 4: Clear Conditions and Qualifications
Clearly explain any conditions or qualifications related to your claims. Avoid misleading consumers with vague environmental benefits. If there are specific circumstances or steps required for a claim to be accurate, highlight them prominently. Be transparent about limitations.
Principle 5: Specificity and Honesty
Avoid broad and unqualified claims that can mislead consumers. Instead, be specific and substantiate your claims with evidence. If there are limitations, use clear disclaimers to qualify your claims.
Principle 6: Clear and Understandable Language
Use language that the average consumer easily understands. Avoid technical terms or jargon that may confuse your audience. Keep it simple and straightforward.
Principle 7: Accurate Visual Representation
Visual elements, such as packaging colours or recycling logos, can significantly impact consumer perception of your product’s environmental impact. Ensure your visuals align with the environmental benefits you claim. Consider the overall impression created by visual elements, colours, and logos.
Principle 8: Transparent Sustainability Transition
When sharing your future environmental objectives, be cautious and realistic. Avoid making empty promises without clear plans. If your business is transitioning to a more sustainable model, be open and direct with consumers. Communicate that sustainability efforts take time and progress may not always be linear. For example, if immediate reduction of greenhouse gas emissions is not feasible but you are offsetting the impact, be transparent about it.
If you need assistance with your business’s sustainability endeavours, the Carbonhalo team can provide guidance and help quantify your emissions, offering a range of measurement services, and marketing support.