What is ‘greenwashing’ and why is the Consumer Protection Authority cracking down on it?

As more companies attempt to cash in on the growing demand for sustainable products, a new form of deception has emerged — greenwashing. The Central Consumer Protection Authority (CCPA) in India is taking a firm stand against this practice with its newly issued guidelines, titled "Guidelines for Prevention and Regulation of Greenwashing or Misleading Environmental Claims, 2024." But what exactly is greenwashing, and why is this issue suddenly in the spotlight? Let’s break it down.

Understanding greenwashing

Greenwashing is a marketing tactic where companies make false or exaggerated claims about the environmental benefits of their products or services. They often use vague or misleading terms like "natural," "eco-friendly," "organic," or "green" without providing any credible evidence to back these claims. The term is a play on the word "whitewashing," reflecting the idea of glossing over the truth to appear more environmentally responsible than they actually are.

For example, a brand might label a product as "sustainable" without disclosing the specifics of what makes it sustainable. Without proper context, these claims can mislead consumers into believing they're making an environmentally responsible choice, when in reality, the product may not meet basic sustainability standards.

Why is greenwashing a problem?

Greenwashing does more than just mislead consumers; it undermines genuine environmental efforts. When companies falsely claim that their products are eco-friendly, they exploit consumers' growing desire to make positive environmental choices. This deception not only damages consumer trust but also diverts attention from companies and products that are genuinely sustainable.
As consumers become more eco-conscious, the number of green products on the market has increased, making it harder to distinguish between real and fake claims. This confusion is detrimental to the overall movement toward a greener planet, as it can slow down progress and reduce the impact of legitimate sustainability initiatives.

A step towards accountability

In response to this growing issue, the Central Consumer Protection Authority (CCPA) in India has released detailed guidelines aimed at preventing greenwashing and misleading environmental claims. These guidelines are designed to promote transparency and ensure that environmental claims are both truthful and meaningful.

Some key highlights of the guidelines include:

• Clear Definitions: The guidelines provide precise definitions of terms like greenwashing and environmental claims, ensuring that businesses and consumers have a shared understanding. For instance, companies can now no longer make claims such as “minimal” impact on the environment, since they must now define what minimal actually entails.
• Transparency Requirements: Companies must back their environmental claims with credible evidence, including data and methodology used to support their assertions.
• Prohibition of Misleading Terms: The guidelines prohibit the use of vague terms such as "eco-friendly," "green," and "sustainable" without proper substantiation. For example, if a hand wash is biodegradable, its marketer must make it clear that the advertisements mention the hand wash and not the bottle.
• Third-Party Certifications: The guidelines encourage the use of third-party certifications as credible proof of a product’s environmental benefits.
• Adequate Disclosures: Companies must provide clear and accessible information about their claims, specifying which aspect of their product is sustainable (e.g., materials, manufacturing process, or packaging).

Why the crackdown now?

The CCPA's crackdown on greenwashing comes at a time when consumer awareness about environmental issues is at an all-time high. More people are seeking out sustainable products, and businesses are eager to tap into this growing market. However, without proper regulations, the line between genuinely green products and deceptive marketing tactics has blurred.

The guidelines were developed after extensive consultations with various stakeholders, including experts from academia, consumer organisations, industry representatives, and legal practitioners. The goal is not to stifle companies’ efforts toward sustainability but to ensure that their claims are honest and backed by evidence.
For businesses, these guidelines mean that they must be more careful and transparent in their marketing strategies. Companies that make unsubstantiated claims about their products' environmental benefits risk facing legal action and damage to their reputation. On the other hand, companies that invest in genuine sustainability initiatives will stand to gain from increased consumer trust and loyalty.

For consumers, this crackdown on greenwashing is a positive step toward ensuring that they are not misled by false claims. It empowers them to make more informed decisions about the products they purchase, supporting those that truly contribute to a greener and more sustainable future.