UK greenwashing litigation in fashion and retail

Clothing brands have in recent years launched “sustainable” clothing lines, made from “recycled materials” or aimed at “reducing waste”, in order to seize consumers’ appetite for more sustainability. However according to a greenwashing of 2021 guidance document by Generation Climate Europe, the majority of green claims (59%) did not comply with the guidance on green claims issued by the UK’s Competition Markets Authority (CMA).

Greenwashing litigation in the fashion sector

The growing interest in sustainable fashion has led to a hot summer for the fashion industry, with some of the biggest fashion retailer brands facing green bleaching procedures and investigations.

In July 2022, the CMA announced the launch of surveys in ASOS, Boohoo and Asda on corporate sustainability claims. The investigations aim, among other things:

  • statements and language used by companies that may be too broad and vague, suggesting that their products are more sustainable than they actually are;
  • the criteria used by companies to decide which products to include in their “sustainable” collections, which may be less stringent than customers might reasonably expect (for example, it is alleged that certain products claimed to be made from materials recycled can contain as little as 20% recycled fabric); and
  • statements made by companies on fabric accreditation systems and standardswhich we believe could also be misleading.

The CMA’s investigations follow the release of its Green claim code in September 2021, which aims to educate businesses on how to communicate their green initiatives without misleading consumers. Investigations also demonstrate the CMA’s willingness to investigate behavior that violates its Code.

The CMA only conducts investigations if it believes there is misconduct across the industry, leaving cases of individual breaches mainly to the Advertising Standards Authority (ASA). The recent actions of the CMA are therefore a signal for the whole fashion industry that greenwashing will not be accepted. Other sectors, including travel, hospitality and consumer goods, can be expected to come under scrutiny from the CMA.

Retail Greenwashing Litigation

Recent ASA actions also point to similar trends in the retail and consumer goods sectors.

This summer, the ASA found that a Tesco advertisement, which claimed its plant-based products had a lower environmental impact than traditional meat, was misleading because it had not backed up its claims with a full life-cycle analysis. The ASA Recognized that it was generally accepted that by switching to a more plant-based diet, consumers could reduce their overall impact on the environment. However, some plant-based products may contain a combination of ingredients and have complex production processes that could theoretically result in a similar or greater negative environmental impact than base plant ingredients or a meat-based alternative. The ruling is an important reminder that for comparative environmental claims to be clear, assessment of full life cycle impacts is required.

This summer, the ASA also prohibited a Unilever advertisement for Persil washing liquid for making misleading sustainability claims. The advertisement claimed that the product was “more planet-friendly” because it removed stains at lower temperatures and washed faster, and its bottle was made from “50% recycled plastic”. The ASA considered that the “kinder” comparative claim was likely to be ambiguous to viewers. Additionally, the advertisement was found to have misled consumers due to a lack of evidence demonstrating that the full life cycle of the product had a lower environmental impact compared to a previous formulation. Although this is a case more focused on plastics than climate, the reasoning on Unilever’s environmental claims could be transferable to net zero climate commitments.

CMA investigations and ASA rulings indicate a growing regulatory appreciation of the impacts of consumer purchasing power on climate and the environment more generally. They also point to a regulatory drive to examine sustainability marketing to consumers across a wide range of consumer goods. Finally, these cases arguably bring broader environmental issues, including plastic pollution, into the context of greenwashing litigation. In this context, companies that promote the sustainability credentials of their products are increasingly seeking legal advice and guidance to mitigate the liability risk that could arise from such campaigns.

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