Everything about the EU's new Green Claims Directive (Anti-Greenwashing Rules)

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What’s the EU Green Claims Directive?

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The Green Claims Directive is a proposed legislation by the EU, aimed at addressing the issue of greenwashing for all voluntary environmental claims (regardless of company size) made- and labels used in B2B and B2C marketing within the EU. 

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It provides a set of rules and requirements to regulate- and verify these various types of environmental claims (for products and services). Enforcing transparency and credibility to protect consumers- and encourage businesses to truly reduce their environmental impact. Once approved, the Green Claims Directive is expected to go into force in 2024.  

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On the 19th of September 2023, the European Parliament and Commission reached a provisional agreement on the Directive's anti-greenwashing rules. On the 17th of January 2024, the European Parliament voted and passed the directive with 593 MEPs voting for 'pass' and only 21 MEPs voting against. The final step: approval by the EU council, which is expected to happen soon within the next 3 months. Any changes made to the directive are incorporated in the text below.

The problem of greenwashing

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The Directive is the result of an increasing occurrence of greenwashing within the EU. An EU study from 2020 found that over 53% of environmental claims examined were vague, misleading, or unfounded. Whilst 40% were even completely unsubstantiated.

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This is an issue. As legislation and demand for sustainable products increase. 

According to the Special Eurobarometer 501, 94% of Europeans prioritize environmental protection, and 68% acknowledge their consumption habits impact the environment. 

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Ineffective sustainable decision-making

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The main problem of greenwashing: we can’t make effective sustainable decisions if the information these decisions should be based on -lacks any evidence, is unclear, or is dishonest. 

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This lack of credible evidence:

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• Slows down the sustainable progress we need to meet our climate targets;
• Misleads B2B and B2C customers into making ineffective sustainable choices; 
• Creates unfair competition with companies who are genuinely environmentally responsible. 

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So, what kind of claims are we talking about?

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What is a “green” claim?

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A ‘green claim’ as defined by the EU, is a voluntary claim made by businesses that state or imply a “positive positive environmental impact, lesser negative impact, no impact, or improvement over time for their products, services, or organization”. 

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Additionally, these claims relate to the environmental impact, aspect, or performance of a product or company made over the entire life cycle of a product (from raw materials to end-of-life). 

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Think of claims such as:

• “packaging made of 30% recycled plastic"
• “this packaging has a low carbon footprint”
• “this packaging is sustainable because…”
• “this product is carbon neutral”

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What are the EU’s proposed rules for green claims?

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1.  'Climate-neutral'/'carbon-neutral' claims will be banned.

Claims stating a product is carbon-neutral, reduced, or has a positive impact on the environment due to emissions offsetting - are banned to prevent ambiguity and misleading consumers. 

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Companies must transparently distinguish between (1) emissions reductions in their own operations and (2) those achieved through offsets, ensuring the integrity and accurate accounting of offsets.

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2. Scientific, data-driven evidence is required: Life Cycle Assessment (LCA)

No proof, no claim: Generic environmental claims, e.g. “environmentally friendly”, “natural”, “biodegradable”, “climate neutral” or “eco”, without proof are banned.

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Claims must be substantiated with scientific evidence that is widely recognized. Such as the evidence calculated using the method Life Cycle Assessment (LCA). This identifies the relevant environmental impacts and any trade-offs between them. Material statements, such as ‘this is made of 30% recycled materials’ also require scientific studies as proof.

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Does the Green Claims Directive require ISO-verified LCAs?

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The EU's Green Claims Directive does not require companies to make an LCA according to ISO or perform an ISO verification of their LCAs. As they state the accompanying costs and time are not scalable and realistic for the market to meet the set climate targets. The rules provided by the Green Claims Directive state how companies should make proper scientific environmental claims (LCA-based), grounded in transparency so they can be accessed and checked by anyone.

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3. Fair comparisons

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If the environmental benefits of products or organizations are compared with other products and organizations, these comparisons must be fair and based on equivalent information, methodology, and data  

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4. Transparency & verification are required

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Environmental claims and labels must be completely transparent and accessible, verified by a third party (such as Pickler), and regularly reviewed on their relevance (is the data up to date?). 

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5. Only Trustworthy Sustainability Labels

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Only sustainability labels based on approved certification schemes or established by public authorities, will be allowed. There is a huge increase in private labels (the EU already identified 230) and labels made by companies - of which many differ in robustness and reliability. The result: public skepticism, and biased results. 

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This means EU level schemes will be encouraged, such as the EU Ecolabel. While new public schemes, unless developed at EU level, will not be allowed. New private schemes are only allowed if they can show higher environmental ambition than existing ones and get pre-approval

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6. Durability and repairability claims require proof

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• Durability claims: If a product claims a design feature extends the product's durability in usage time or intensity - this should be proven.
• Repairability claims: It's not allowed to present a product as repairable when it's not.  
• Premature Replacement: Companies aren't allowed to prompt consumers to replace consumables, such as printer ink cartridges, earlier than strictly necessary;

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What’s the penalty for greenwashing in the Green Claims Directive?

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Qualified entities, including consumer organizations, will have the authority to take legal actions under the Representative Actions Directive to protect consumers when traders are suspected of not meeting substantiation requirements for green claims.

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What are the implications for companies?

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The tightend grip on greenwashing by the the EU, affects companies in many ways.

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1. Reputational damage: Greenwashing accusations and behaviour can lead to severe reputational damage. This can heavily impact stakeholder/customer trust, affecting your companies' bottom line.

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2. Compliance costs: The Green Claims Directive is one of the many regulations the EU set out for sustainable business. To prepare you might need to hire extra employees, external sustainability services, buy the necessery software, etc.

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3. Competitive disadvantage: B2B and B2C customers are increasingly asking for the credible sustainability information behind their purchases. Not having this information can result in losing business.

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4. Legal penalties: Not complying with EU legislation can result in penalties and other legal actions.

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How do you prepare for the Green Claims Directive?

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Companies can prepare for the Green Claims Directive by calculating the environmental impact of their products according to an LCA methodology. Whilst also already adhering to the rules of communication defined in the directive and national consumer protection authorities (such as the rules by the Dutch ACM). This way compliance granted by independent verifiers, becomes more likely. 

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Our advice:

1. Analyze, revise, and continously monitor your current marketing claims
2. Calculate the scientific evidence necessery to back up your claims
3. Train your employees on anti greenwashing rules and guidelines

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Pickler helps packaging companies create and share footprint calculations for their packaging claims in sales and marketing - completely in line with the Green Claims Directive. 

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Our LCA-based methodology, software, and output (i.e. our impact widgets) adhere to all EU anti-greenwashing rules. Pickler functions as a third-party verifier for your claims as required by the Green Claims Directive. 

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Contact our sales today or start the 14-day free Pickler trial - and minimize greenwashing risks for your packaging.

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