As businesses and consumers alike have become more climate and environment conscious, demand for environmentally responsible and ethical products has soared. The response from many businesses has been to look for ways to brand and market their products on an environmentally sustainable promise.

Examples of common advertising claims you have probably seen in recent times include:

• Advertising carbon neutrality
• Highlighting the biodegradability of packaging
• Claiming that products are made with recycled materials
• Certification claims such as welfare or organic certification claims

The pursuit of positioning businesses and brands as environmentally conscious and sustainable has also led to an increase in Greenwashing. This is not just a New Zealand trend. Globally, competition and consumer regulators have become increasingly focused on Greenwashing and related false, misleading, or unsubstantiated claims.

So, what exactly in Greenwashing?

Quite simply, Greenwashing is the use of misleading environmental claims that businesses make about themselves and/or their products. This includes false, exaggerated and unsubstantiated claims.

In our backyard

The New Zealand Commerce Commission (NZCC) has already warned businesses to make sure that any environmental claims they make are accurate and truthful. They have also previously issued warnings and fines to businesses that have run afoul of their guidance and potentially misled consumers.

As Greenwashing becomes more common it is likely that the NZCC will follow suit with its Australian counterparts and focus more of its resources on this growing issue.

Across the ditch

The Australian Competition and Consumer Commission (ACCC) has stated one of their priorities for 2023 is to monitor and target Greenwashing.

The ACCC, too, has warned businesses they need to be ready to substantiate any environmental marketing claims and that any unsubstantiated claims will result in enforcement action.

Other than obviously misleading consumers, the ACCC is also concerned that businesses who do incorporate genuine environmental messaging in their marketing are facing unfair competition from those that are Greenwashing.

How to avoid Greenwashing?

New Zealand businesses who wish to market themselves as environmentally friendly and sustainable need to take care in making sure that any of their claims are truthful, substantiated, and not exaggerated.

If your business is found to be engaging in Greenwashing by the NZCC the impacts can be detrimental. It may result in penalties such as fines, as well as negative publicity which impacts your brand and reputation, so it pays to get the right advice.

Our Consumer Markets team has expertise in advertising, marketing and consumer law and works closely with our clients’ marketing and product development teams. We can advise and assist with review of product packaging, branding and marketing collateral to avoid Greenwashing.