A milestone in the fight of greenwashing: European Parliament adopts new directive aimed at protecting consumers from misleading marketing

The background to the anti-greenwashing directive

The European Parliament’s resounding vote on 17 January 2024 in favour of a directive to combat greenwashing marks a significant milestone in the ongoing effort to protect consumers and uphold environmental integrity in marketing practices within the European Union. This directive, driven by mounting concerns over the proliferation of misleading environmental claims, represents a concerted effort to establish robust regulations that ensure transparency and accountability in the promotion of products and services.

Why is there a need for an anti-greenwashing directive?

At the heart of this directive is the recognition of the imperative to safeguard consumers from deceptive marketing tactics, particularly those that make unsubstantiated or exaggerated claims about the environmental attributes of goods and services. By prohibiting false environmental claims, the directive aims to empower consumers to make informed choices while fostering a marketplace that prioritizes genuine sustainability efforts.

A recent study commissioned by the European Commission underscores the urgency of these regulatory measures, revealing widespread vagueness and unsubstantiated claims in green marketing across the EU. This proliferation of misleading sustainability labels has not only engendered consumer confusion but also eroded trust in environmental marketing practices. By mandating that only certified sustainability labels and substantiated environmental claims be permitted, the directive seeks to restore credibility and confidence in the veracity of environmental assertions made by businesses.

What does the anti-greenwashing directive say?

One notable aspect is the prohibition of generic environmental claims that lack empirical evidence or certification, thereby compelling businesses to substantiate their assertions with credible data. Additionally, the directive tackles the issue of carbon offsetting by banning misleading claims of climate neutrality or positive impact when reliant on offsetting mechanisms, aligning with growing scrutiny over the efficacy of such schemes in mitigating emissions. In practice, this means that terms including “environmentally friendly,” “biodegradable” and “climate neutral” should no longer be used in advertising or on packaging unless there is concrete evidence in support of such terms.

Moreover, the directive extends its purview beyond mere environmental claims to encompass product durability, recognizing the pivotal role of durability in fostering a circular economy and sustainable consumption patterns. False or unfounded durability claims will be targeted, with measures introduced to promote reparability and incentivize businesses to prioritize longevity and repairability in their product designs. By mandating clear labelling and visibility of guaranteed information, the directive seeks to empower consumers to make choices that align with their values and sustainability preferences.

What is next?

While the directive awaits final approval from the EU Council before passing into law, its anticipated swift adoption underscores the collective commitment to combating greenwashing and promoting responsible marketing practices. Once finally approved, the directive will establish a coherent framework for environmental claims and labels, bolstering consumer confidence and fostering a marketplace that champions authenticity, transparency, and sustainability.

What does the anti-greenwashing directive mean for Malaysia?

As of now, Malaysia does not have specific legislation akin to the EU’s directive to combat greenwashing and regulate environmental claims. However, given the global trend towards greater consumer protection and environmental consciousness, Malaysia may find itself influenced by the EU’s actions. With an increasing focus on sustainability and transparency in consumer markets worldwide, Malaysian authorities may see the need to enact similar regulations to safeguard consumers from deceptive marketing practices and ensure the integrity of environmental claims. By aligning with international standards, Malaysia could enhance consumer trust, promote responsible business practices, and contribute to the global effort towards a more sustainable future.

This article was written by Prof. Dr. Harald Sippel and only contains general information. It does not constitute legal advice nor an expression of legal opinion and should not be relied upon as such. Prof. Dr. Harald Sippel is admitted to the Austrian Bar as Rechtsanwalt and to the Malaysian Bar as a Foreign Lawyer. He regularly provides advice to European and Malaysian companies on matters of ESG.