The ACCC has published draft guidance to improve the integrity of environmental and sustainability claims made by businesses and protect consumers from ‘greenwashing’.

The draft guidance aims to address the ACCC’s recent greenwashing internet sweep, which found over half (57%) of businesses reviewed were making potentially misleading environmental claims.

“As consumers become more environmentally conscious, businesses need to be honest and transparent when making environmental or sustainability claims, so consumers are not being misled,” ACCC chair, Gina Cass-Gottlieb said.

“False or misleading claims can undermine consumer trust in all green claims, particularly when consumers are often paying higher prices based on these claims. Similarly, businesses that are taking genuine steps to adopt sustainable practices are put at a competitive disadvantage by businesses that engage in ‘greenwashing’ without incurring the same costs.”

The draft guidance sets out what the ACCC considers to be good practice when businesses make environmental claims about their products and services as well as making them aware of their obligations under the Australian Consumer Law (ACL).

It identifies eight practical principles which the ACCC encourages businesses to apply when making environmental claims. By following these principles, businesses are less likely to mislead consumers and contravene the ACL.

“Businesses must provide clear, accurate and trustworthy information to consumers about any environmental or sustainability claims and be able to provide evidence to back them up,” Cass-Gottlieb said.

“If you make a claim about the environmental or sustainability benefits of your product or service – make sure it’s right, and if you are unsure or can’t substantiate these claims, then don’t make the claim.”

The ACCC is seeking feedback from businesses, consumers and other stakeholders on the draft guidance. Consultation is now open and closes on 15 September 2023.