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A pressing issue facing businesses and consumers at the moment is greenwashing and the urgent need for transparency in business practices. To address this issue, the European Union has introduced the Green Claims Directive. This proposal aims to establish stringent requirements for green claims and environmental labeling, with the goal of empowering consumers with accurate information and leading to a more transparent marketplace.
In this blog, the ENSO team delves into the key aspects of the Green Claims Directive, its purpose, and the obligations it places on businesses.
In short, what is the Green Claims Directive all about?
The Green Claims Directive is a recently proposed measure by the European Union designed to combat greenwashing and misleading environmental claims. This measure would help consumers make informed decisions when purchasing different items, without the risk of being misled.
Why is the Green Claims Directive being implemented?
A comprehensive study conducted by the European Commission revealed that a staggering 53.5% of environmental claims made by businesses are vague, misleading, or lacking substantiation.
In response, the Green Claims Directive establishes clear requirements for green claims and environmental labeling. These requirements aim to provide consumers with transparent and accurate information, empowering them to make well-informed purchasing decisions.
Consumers are increasingly eager to contribute to a greener, more circular economy. However, existing information and labeling schemes often lack clarity and robust evidence. Because of this, consumers are often wary or hesitant to believe green claims or labels. The Green Claims directive will combat this.
What are the requirements for communicating environmental claims?
When companies communicate environmental claims, they must adhere to the following guidelines:
- Limit environmental claims to those assessed in accordance with the Green Claims Directive, ensuring their significance to the specific product or business.
- Avoid making claims about environmental actions that are legally mandated.
- Include instructions for consumers on how to use the product in an environmentally responsible manner.
- Provide specific information that supports the claim, such as details on relevant products or activities, impacts or performance covered, underlying studies and calculations, methods employed to achieve claimed improvements, and any certifications verifying the claim.
Requirements for Environmental Labelling
Environmental labels are subject to the same standards of transparency and accuracy as environmental claims.
Validation schemes will be established in line with the Green Claims Directive, with national authorities tasked with their creation and implementation.
The proposal emphasises that environmental labeling schemes should only be verified if they demonstrate greater environmental ambition, encompass a broader range of impacts, apply to specific product categories or sectors, and actively support the green transition of small and medium-sized enterprises (SMEs), surpassing existing Union, national, or regional schemes.
Some Final Thoughts
In today’s business landscape, it is important that we all closely monitor the progress of this legislation, particularly the guidelines for communicating environmental claims. Ensuring that your business has the systems in place to transparently communicate with your stakeholders is more important than ever.
To combat greenwashing and adhere to the Green Claims Directive, companies need to make public declarations about their commitment to sustainability that are backed-up by evidence. This will show consumers and stakeholders that they take the issue seriously. Employing certifications when discussing sustainability initiatives can further enhance a company’s credibility.
Like what you’ve read and want to learn more? Keep following the blog for even more insights, and check out our blog on the Corporate Sustainability Reporting Directive and how it affect SMEs.