Digging Deeper: Which Green Claims Are Now High-Risk Under the DMCC Act?
In my previous post, I introduced the significant changes brought by the Digital Markets, Competition and Consumers (DMCC) Act, particularly the new powers granted to the Competition and Markets Authority (CMA) to crack down on greenwashing, which came into force last week. I discussed why this matters – the erosion of citizen trust and the unfair disadvantage faced by genuinely sustainable businesses when vague or misleading environmental claims run rampant.
Now, it’s time to delve into the specifics. What kinds of claims and marketing practices are likely to attract the CMA’s attention under this enhanced regulatory framework? While the DMCC Act provides the overarching legal power to tackle 'unfair commercial practices' (which includes misleading environmental claims), the CMA’s existing Green Claims Code (published in 2021) gives us the clearest indication of the principles they apply and the practices they deem problematic. The new Act essentially gives the CMA sharper teeth to enforce these principles.
So, let's break down the types of environmental claims that businesses, especially in the drinks sector, must now scrutinise carefully:
1. Vague, Ambiguous, or Broad Claims
This is perhaps the most common pitfall. Using terms like "eco-friendly," "green," "sustainable," "environmentally friendly," or even "natural" without clear, specific meaning or supporting evidence is now extremely high-risk.
What it means: These terms mean different things to different people. A claim must be precise about what environmental benefit it refers to (e.g., "Made with 30% less water" is better than just "Water conscious").
Drinks Industry Example: Simply labelling a bottle as "eco-friendly" is insufficient. Why is it eco-friendly? Is it the recycled content of the glass? The low-impact transport? The organic ingredients? Be specific. Similarly, "sustainable farming practices" needs qualification – what practices, and according to which standard?
2. Omitting or Hiding Key Information
Cherry-picking positive attributes while ignoring significant negative impacts is considered misleading by omission. Citizens need the full picture to make an informed decision.
What it means: You can't highlight one small green credential (like a recyclable cap) if the overall product or process has a significant negative environmental impact that isn't mentioned (e.g., high carbon footprint in production or transport).
Drinks Industry Example: Promoting the use of lightweight recycled glass (a positive) while failing to mention that the exotic ingredients inside are air-freighted from halfway across the world (a significant negative impact) could be seen as misleading. Full lifecycle thinking is crucial.
3. Claims Lacking Substantiation (No Proof!)
Any environmental claim made must be backed up by robust, credible, and verifiable evidence. If you can't prove it, don't claim it.
What it means: The burden of proof lies with the business making the claim. This might involve lifecycle assessments, supply chain certifications, or independent testing data.
Drinks Industry Example: Claiming your distillery runs on "100% renewable energy" requires clear evidence, such as energy supplier contracts or Renewable Energy Guarantees of Origin (REGOs). Claiming a certain percentage reduction in carbon emissions needs transparent data and methodology.
4. Unfair or Meaningless Comparisons
Comparing your product's environmental performance with competitors must be done fairly and transparently, comparing like-for-like aspects based on clear, verifiable information.
What it means: You can't compare your product's best feature against a competitor's worst, or make a comparison based on outdated information or different methodologies. The basis of the comparison must be clear.
Drinks Industry Example: Claiming your packaging has "50% lower emissions than Brand X" requires you to be sure the comparison is fair – are you comparing the same size format? Based on the same lifecycle stages? Using up-to-date, comparable data?
5. Ignoring the Full Lifecycle
Environmental impacts occur at all stages of a product's life – sourcing raw materials, production, transport, citizen use, and disposal. Focusing narrowly on one stage while ignoring others can be misleading.
What it means: A claim about recyclability, for instance, needs to consider if the product is actually recyclable in practice through mainstream UK collection systems, not just in theory or in niche facilities. It also involves considering all components of the packaging.
Drinks Industry Example: Labelling a complex multi-material carton (e.g., liquid cartons) as simply "recyclable" without qualification about local collection availability or the need to separate components could be problematic. Similarly, focusing only on the carbon footprint of distribution ignores the potentially larger impacts of agriculture or distillation.
6. Misleading Visual Symbols or Logos
Using imagery, colours (like excessive green), or symbols that suggest environmental friendliness without justification is also considered misleading.
What it means: Inventing your own "eco" logo that isn't linked to any accredited standard, or using images of pristine nature that falsely imply a product benefit, can be deceptive.
Drinks Industry Example: Using a green leaf symbol prominently on packaging might imply organic or specific environmental credentials that the product doesn't actually possess according to recognised standards.
Why Getting It Right Matters More Than Ever
Under the DMCC Act, the CMA doesn't necessarily need to go through lengthy court proceedings to issue penalties for breaches of consumer law in this area. They can investigate and directly impose significant fines – up to 10% of global turnover. Beyond the financial risk, the reputational damage from being publicly called out for greenwashing can be immense, destroying trust that is hard-won and easily lost.
Conversely, businesses that are transparent, accurate, and evidence-based in their sustainability communications can build stronger relationships with citizens and stand out for the right reasons in a market demanding genuine environmental responsibility.
Next Steps
Understanding what not to do is the first step. The next challenge is knowing how to ensure your claims are compliant and effectively communicate your genuine sustainability efforts. In the next article in this series, we will focus on practical steps businesses can take to audit their claims, gather evidence, and market their environmental credentials responsibly under the new rules.
Stay tuned, and in the meantime, take a critical look at your current environmental messaging through the lens of these prohibited practices.
