You pay more for ‘green’ products, but half of them aren’t, survey finds

greenwashing by companies is rampant

Do you reuse your towel while staying at a hotel or resort as per the polite request to ‘conserve energy and valuable resources’? The ‘save the towel’ movement was initiated in 1986, with the best of intentions, but the term ‘greenwashing’ came into being shortly after.

Environmentalist Jay Westerveld, who coined the term, said the campaign had little impact beyond saving hotels money in laundry costs.

Greenwashing is now a global ‘scam’ of sorts and the Australian Competition and Consumer Commission (ACCC) is fighting back.

An ACCC internet sweep of 247 businesses found more than half (57 per cent) made false or misleading claims about their environmental or sustainability practices.

Eight sectors were surveyed. The cosmetic, clothing and footwear, and food and drink industries had the highest proportion of concerning claims, while vehicles and the electronics and home appliance sectors fared relatively well.

Responsible choices

Most consumers want to make environmentally responsible choices, and are prepared to pay a premium for that ‘feel-good’ factor, but it’s obviously not that easy.

Alan Kirkland, CEO at consumer advocate CHOICE, is scathing in his assessment of greenwashing offenders, labelling them “the worst of the worst”.

“They are taking advantage of people’s desire to do the right thing, in the most cynical way,” he says. “We know from research that many consumers want to make more sustainable choices but aren’t sure which products they can trust. This report shows why so many consumers are confused.

“There is a litany of environmental labels, many of them without any processes or evidence to back them up.

“What makes it worse is that businesses often charge a premium for environmental products.

“People should always get what they pay for, but that’s even more important when people are paying more for a product that promises something special.”

High evidence of greenwashing

ACCC deputy chair Catriona Lowe says the high incidence of greenwashing undermines the efforts of businesses that are genuinely engaged in making a positive contribution to the environment.

She warns that those making vague or unclear environmental claims will – and are – being investigated.

“Businesses using broad claims like ‘environmentally friendly’, ‘green’ or ‘sustainable’ are obliged to back up these claims through reliable scientific reports, transparent supply chain information, reputable third-party certification or other forms of evidence,” she says.

“Where we have concerns, we will be asking businesses to substantiate their claims.”

Ms Lowe says the ACCC already has several investigations under way across the packaging, consumer goods, food manufacturing and medical devices sectors for alleged misleading environmental claims.

Guilty parties could face fines of up to $10 million under the Australian Consumer Law but the ACCC appears intent on educating first, penalising later.

Accurate claims

“We want to see businesses taking steps to ensure that environmental claims are accurate as well as meaningful for consumers,” says Ms Lowe. “We will engage directly with businesses and industry associations to improve compliance with the Australian Consumer Law.”

The ACCC wants businesses to ‘fess up’ if they become aware they’ve made false or misleading marketing claims. They will then be “considered more favourably than those who wait for the ACCC to unearth these problems”.

Corporate regulator the Australian Securities and Investments Commission (ASIC) launched court proceedings earlier this year against Mercer Superannuation (Australia) Ltd for statements that seven of its ‘Sustainable Plus’ investment options were misleading. ASIC says some investments had companies such as fossil fuel producers Whitehaven Coal and Glencore a

In August, it commenced civil penalty proceedings in the Federal Court against LGSS Pty Limited (Active Super) alleging misleading conduct and misrepresentations to the market relating to claims it was an ethical and responsible superannuation fund.

The ACCC encourages consumers and businesses to report any potentially misleading environmental or sustainability claims through the ACCC website or by contacting the ACCC Infocentre on 1300 302 502.

Does greenwashing make your blood boil? How do you judge whether it’s worth paying extra for products that claim to be ‘green’? Why not share your thoughts in the comments section below?

Also read: How to buy an environmentally friendly refrigerator

Written by Janelle Ward

Energetic and skilled editor and writer with expert knowledge of retirement, retirement income, superannuation and retirement planning.

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