ARE THE NEW CONSUMERS GOING TO ALLOW EVERYTHING TO BE PAINTED IN GREEN?
EU prepares new rules to combat “greenwashing”
Recently, the European Parliament and the Council agreed in principle to adopt new measures to combat misleading practices such as “greenwashing” and to guarantee consumers reliable and high-quality information about the products they consume, in the current context of the transition towards sustainability in business.
For example, generic terms such as “eco-friendly”, “natural”, “ecological”, “biodegradable” or “environmentally neutral” will no longer be allowed in the characterisation of products, unless the veracity of the information can be demonstrated.
Other examples of practices that will be removed under new rules being prepared in the EU include uncertified claims of environmental and social responsibility, incentives for consumers to replace consumables before their expiry date, claims that the product can be repaired when this is not the case, and references to products with a neutral, reduced, or positive environmental impact linked to carbon offsetting.
By introducing more detailed reporting requirements on companies’ impact on these issues, based on common criteria in line with EU climate targets, Parliament hopes to put an end to this problem. These obligations also guarantee human rights, environmental and social standards.
These measures are part of a broader regulatory framework, integrated into the EU’s sustainability strategy, which will determine the new way in which companies will engage with the market.
Although it will not initially cover all companies, this transition, known as ESG (“Environmental, Social and Corporate Governance”), is inevitable for all small and medium-sized enterprises that want to maintain their competitive edge in the context of the global marketplace.
In essence, these ESG practices are a company’s commitment to the future, whether it is the well-being of its employees, communities, or the protection of the planet. These practices were created in 2004 by the United Nations (UN) Global Compact, in partnership with the World Bank, and are linked to the 17 Sustainable Development Goals (SDGs), also created by the UN.
At the recent COP28 climate summit in Dubai, United Arab Emirates, UN Secretary-General António Guterres warned that 2023 would be the hottest year on record, stating that “we are experiencing climate collapse in real time and the impacts are devastating,” citing the increase in fires, floods, and heatwaves that the planet has suffered in recent years.
At COP28, Guterres also said that world leaders “must come up with clear proposals for the next round of climate action plans”.
Previously, Guterres had already taken action in response to the rise of “greenwashing”. The UN Secretary-General established a “High-Level Panel of Experts” to develop clearer rules for net zero emission pledges by companies, financial institutions, cities, and regions, and to accelerate their implementation.
In the report “Integrity Matters: Net Zero Commitments by Businesses, Financial Institutions, Cities and Regions”, the expert group outlines ten recommendations for credible and accountable net zero emission commitments and details the considerations needed at each stage to achieve the net zero emission goal and address the climate crisis.
To further accelerate this climate transition, Guterres convened a Climate Ambition Summit at UN Headquarters in New York in September this year, focusing on ambition, credibility, and implementation, leaving “no room for backtrackers, environmentalists, blame-hiders or rehashersers of previous years’ announcements”.
But what is the role of new consumers in this ecological transition?
Although there is still a long way to go, reports show that consumers are more concerned about environmental issues than they were 10 years ago.
According to DECO PROTESTE, the Portuguese consumer protection association, around 57% of EU consumers are receptive to environmental claims when making choices and purchases.
As a result, more and more consumers are looking at each product’s options and looking for the “Ecolabel”. This is the European eco-label, certified by the European Union and verified by competent organisations, which guarantees that a product or service has a good environmental performance.
In this way, consumers know that it is a reliable brand and that the entire production and consumption chain is more transparent.
Consumers are therefore demanding transparency from companies and are increasingly asking them to comply with the European Ecolabel, which requires manufacturers to meet a number of environmental requirements.
In addition, around 43% of Portuguese consumers agree that the shopping experience is more positive when they are presented with sustainable alternatives. This is according to the “Observador Cetelem Consumo Sustentável” study conducted by Banco Cetelem.
However, more than half of those surveyed (54%) would like to see more product recommendations, especially those aged between 25 and 44 (58%), which shows a lack of transparency.
The study “Sustainable Packaging. Has the COVID-19 pandemic changed everything?”, conducted by DS Smith and Ipsos Mori Research, reveals that around 85% of European consumers value sustainable product packaging. The study, which involved more than 9,000 respondents from 12 European countries including Portugal, Spain, and Italy, shows that environmental awareness and the rise of environmentally and socially responsible behaviour are becoming increasingly fashionable.
According to the study, 85% of respondents prefer to buy products that use as little packaging as possible and around 29% admit that they have stopped buying certain brands because they are not sustainable.
Consumers are therefore demanding that organisations and companies adopt circular packaging solutions that respond to the real challenges facing the environment today.
In short, most EU consumers are receptive to environmental claims and are playing an increasingly active role in the fight against greenwashing. Transparency and environmental responsibility are factors that consumers see as crucial to exposing this practice. Choosing genuinely “green” products and services is crucial, which is why more and more concrete measures are urgently needed to regulate and combat this so-called “green marketing”.
Supporting documents:
- Broken Record
- Business of Sustainability Index
- Integrity Matters: Net Zero Commitments By Businesses, Financial Institutions, Cities and Region
- UNFCCC Secretariat Recognition and Accountability Framework Draft Implementation Plan with respect to Net-Zero Pledges of non-State actors and Integrity Matters
- Corporate Climate Responsibility Monitor 2023
- UNFCCC Secretariat Recognition and Accountability Framework for non-Party stakeholder climate action.
- Sustainable Packaging. Has the COVID-19 pandemic changed everything?
Links:
- Zero tolerance for greenwashing”, Guterres says at report launch | United Nations
- IAPMEI – Transição ESG | UE prepara novas regras de combate ao ‘greenwashing’ na divulgação de produtos
- New sustainability reporting rules should hold companies accountable, says Parliament| European Parlament (europa.eu).
