The move is an expansion of ongoing work by the Competition and Markets Authority (CMA) into ‘greenwashing’, which seeks to get to the bottom of whether products and services that claim to be green or eco-friendly are being marketed to shoppers accurately.
The CMA’s review will examine a wide range of products known as ‘fast-moving consumer goods’ (FMCG). These are essential items used by people on a daily basis and repurchased regularly, such as food and drink, cleaning products, toiletries, and personal care items. In 2021, the average household spent almost £70 a week on food and drink alone, and the FMCG sector as a whole is worth over £130 billion annually.
The CMA will analyse environmental claims made about such products – both online and in store – to consider whether companies are complying with UK consumer protection law. Concerning practices could include the use of vague and broad eco-statements for example packaging or marketing a product as ‘sustainable’ or ‘better for the environment’ with no evidence; misleading claims about the use of recycled or natural materials in a product and how recyclable it is; and entire ranges being incorrectly branded as ‘sustainable’.
Sarah Cardell, Chief Executive of the CMA, said:
These products are the essentials on everyone’s shopping lists: food and drink, shampoo, laundry detergent, toothpaste, cleaning products. As more people than ever try to do their bit to help protect the environment, we’re concerned many shoppers are being misled and potentially even paying a premium for products that aren’t what they seem, especially at a time when the cost of living continues to rise.
Our work to date has shown there could be greenwashing going on in this sector, and we’ll be scrutinising companies big and small to see whether their environmental claims stack up. Now is a good time for businesses to review their practices and make sure they’re operating within the law.
The move comes as part of the CMA’s ongoing work into misleading green claims. In January 2022, the CMA turned its eye to the fashion sector, launching enforcement action against well-known fashion brands ASOS, Boohoo and George at Asda in July last year. The CMA wrote to the 3 firms outlining its concerns and the investigation is ongoing.
The CMA also produced the Green Claims Code – a guide to help businesses understand how to communicate their green credentials, while avoiding the risk of misleading shoppers.
How the review develops will depend on the CMA’s assessment of the evidence before it. If the CMA uncovers evidence suggesting green claims could be unfounded, it will consider taking enforcement action using its formal powers – for example, opening an investigation into specific companies.
In its Annual Plan consultation 2023 to 2024, the CMA detailed its strategic priority to continue to take action to accelerate the transition to a net zero economy and promote environmental sustainability.
More information can be found on the CMA’s Fast Moving Consumer Goods investigation page.
