EU vows to crack down on greenwashing with new rules for labels

Naturally sourced. Earth friendly. 100% organic. Cruelty free. Bio.

These are some examples of the 230 environmental labels that can today be found stamped on products and services sold across the European Union.

But can all these labels be trusted?

Not quite.

According to estimates released by the European Commission, around 53% of environmental claims made by companies contain “vague, misleading or unfounded” information, while 40% are “completely unsubstantiated.”

Greenwashing – a deceptive marketing strategy used to disguise goods under a fake veneer of climate neutrality – is rampant across the bloc, as a plethora of labels, brands and designations confound consumers and blur the line between sustainable and polluting.

Civil society and activists have for years urged stronger action to clamp down on this phenomenon, which is thought to have increased in popularity and sophistication as the severity of the climate crisis exacerbates.

With this in mind, the European Commission unveiled on Wednesday a new set of rules that will compel companies to back up their green claims with credible scientific evidence.

Firms that wish to stamp an environmental label will need to undergo an independent verification process before placing their goods on supermarket shelves. 

This information will have to be easily accessible for consumers so they can understand what lies behind the production chain. For example, though a QR code or website link.

“We want, first of all, consumers to get trustworthy information, which is consistent and verifiable,” Virginijus Sinkevičius, the European Commissioner for environment, said on Wednesday while presenting the plans.

“We want environmental labels that are more transparent and, of course, easier to understand.”

‘Separate truth from fiction’

The new law, dubbed Green Claims Directive, will neither create a unified EU-wide label nor ban existing ones. Instead, it will harmonise the requirements that apply to the hundreds of environmental labels currently on the market.

Adding an environmental label will continue to be a business decision at the discretion of companies. But if they choose to do so explicitly, they will need to follow the directive’s guidelines.

Those that ignore the rules and persist in their greenwashing practices will be at risk of penalties, such as monetary fines, confiscation of revenues and the temporary exclusion from public procurement.

“Companies, they routinely use environmental claims to market their goods, and, of course, when consumers see those claims, it’s extremely difficult to separate truth from fiction,” Sinkevičius said.

The EU’s official Ecolabel will be spared from the rules because it already complies with the third-party verification criteria.

The legislation proposed on Wednesday will now enter negotiations between member states and the European Parliament before entering into force.

Speaking to the press, Sinkevičius suggested that “most” of the green labels currently unsubstantiated will disappear after the directive is transposed but he avoided giving an exact number.

 The European Environmental Bureau (EEB) welcomed the directive as a “promising tool to wipe out the misleading claims that muddy the waters of sustainability” but regretted the lack of a clear-cut ban on green claims attached to products with hazardous chemicals.