How to avoid greenwashing? With a new EU directive!

Recently, we have seen increasing pressure on products to be as environmentally friendly and sustainably produced as possible, as consumer demand for such products has been growing. Some entrepreneurs have been taking advantage of this, as in their marketing strategy they try to convey the (false) impression that their products are green, i.e., environmentally sound (hence the term “greenwashing”). Examples include the use of “eco” or “organic” labels, various green symbols and logos, or claims that the product contains a certain proportion of recycled materials or ingredients of natural origin. In some cases, such claims may be well-founded, but according to a 2020 study by the European Commission, more than half of them are misleading or unsubstantiated.

The European Commission has therefore presented a proposal for a Directive on Green Claims, which should strengthen consumer protection against greenwashing. Consumers should have more certainty that products labelled as ecological do not have a negative impact on the environment. In particular, entrepreneurs will be obliged to substantiate their green claims with reliable scientific evidence. In addition, they will have to specify whether the claim refers to the whole product, its part, or even just to the activity of the entrepreneur or a specific aspect of it.

Directly on the product, the entrepreneur will then have to provide information, among other things, on how the green claims have been substantiated, including background studies or calculations made in the environmental impact assessment. The summary of that information should be clear and understandable for consumers. To comply with this information obligation, it will be sufficient if, e.g., a link to a website or a QR code containing the information is placed on the product.

The directive also affects entities issuing environmental certificates, as it lays down requirements that will have to be complied with by public institutions and the private entities issuing such certificates. This includes the symbols of these certificates on products, which should not be misleading to consumers.

EU member states will then have to ensure that an independent body verifies that entrepreneurs comply with the obligations set out by the directive. It will also be up to member states to stipulate adequate penalties in their national law. Penalties may comprise fines, the confiscation of revenues gained from selling the products concerned, or the exclusion from public procurement and from access to subsidies for up to 12 months.  

Thanks to the directive, consumers will be better able to make informed purchasing decisions. The legislative process of the proposal for the directive is currently at its very beginning. Once the directive enters into force, member states will have 18 months to transpose it into national law.