The European Commission Is Moving Forward To Limit Greenwashing

The European Commission has presented a proposal for a directive to regulate greenwashing. Its objective is to enhance the quality of information provided by companies to consumers on product labels and advertisements and thus avoid misleading or unjustified communications concerning their impacts on climate change and the environment.
The Commission, by adopting common criteria to fight against greenwashing, wants consumers to benefit from greater clarity and greater assurance that a product sold as ecological really is. This proposal therefore aims to give consumers concrete means of acting directly in favor of the ecological transition.

According to the Commission, rigorous measures are necessary. Greenwashing remains a widespread phenomenon on the European market. A 2020 Commission study shows that 53% of environmental communications from companies in the European Union (EU) are vague, misleading or unfounded and that 40% of them are unsubstantiated. Among these measures presented on March 22, 2023 and which concern all sectors, there is the complex question of the assessment of the environmental footprint. Companies often use a single indicator (the carbon footprint, for example) to justify the positive impact of a product, without however considering other issues, such as biodiversity or water consumption, which can be negatively impacted by the product itself. The European executive proposes in particular to prohibit aggregate ratings on the environmental impact of a product, because according to him “ there is a risk that the nature of an aggregate indicator could be used to dilute the negative impacts of certain parameters ” .

To require companies to provide reliable, comparable and verifiable information, the European Commission is also proposing other significant measures, including the exclusive authorization of statements based on “ scientific and recognized ” bases. If this directive were approved, it would be necessary to be able to prove, through scientific methodologies, the environmental characteristics of the products. Vague statements, such as “sustainable” or “ecological”, can in principle no longer be used. Except if the companies can prove that they take into account all the significant environmental impacts.

In addition, the commission plans to rely on a selection of trustmarks. Examination of the 230 “ecological” or “green” labels existing in the EU shows that half are granted with “weak or non-existent” checks. To avoid their proliferation, the creation of new private labels would only be authorized if they demonstrate “ a higher level of environmental ambition than existing systems ”. The European Commission also plans to have the declarations of companies on the impact of their products (“ carbon neutral ” or “ zero impact ”) verified by independent bodies. Before companies communicate them to consumers, companies’ green messages will need to be independently verified.

One of the important points of the directive is that it will allow consumers to turn against companies that practice greenwashing. The regulatory authorities will have to make it possible to obtain financial compensation and will also be able to sanction companies in the event of non-compliance.

These proposals will now be submitted for validation by the European Parliament and the Council. If approved, companies actually committed to the energy transition could benefit from these new rules. According to the objectives of the European Commission, this regulation will thus contribute to establishing fair conditions of competition concerning the quality of information on the environmental performance of products.

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