THE GREENWASHING PHENOMENON
The above-mentioned phenomenon, i.e. window-dressing environmentalism, is a form of communication that many companies, organisations or political institutions risk putting into practice by providing a misleading image, in terms of positive environmental impact. Consequently, the effect of such conduct is precisely to divert public attention from the negative environmental effects generated by the activities or products of the companies themselves. This development, however, jeopardises the accuracy of companies' ecological claims, either by making untruthful or misleading claims about consumers, investors and other market participants (e.g. by presenting a product that is more sustainable than it really is) or by omitting relevant information. This phenomenon is a symptom of competition between entities, the absence of rules and controls, deficiencies in the entity's structures, ethics, corporate governance, etc.
THE DIRECTIVE 824/2024
The aim of this directive is to improve the labelling and durability of products, thus putting an end to misleading claims being made. This approach is intended to help not only consumers in their commercial choices, but also companies, so that they can offer better quality, especially in terms of sustainability. It is important to mention the presence of the following text within the first circular economy package, along with other documents already present.
In addition, this provision places several prohibitions and generic transparency obligations on environmental and sustainability claims. In fact, it will lead to the inclusion of new specific rules in the Consumer Code, thus making it easier for authorities to detect and challenge misleading practices and curbing the phenomenon of Greenwashing.
The best-known AGCM measure on this topic is certainly the one of 20 December 2019 No. 28060 for the implementation of an unfair commercial practice to the detriment of consumers for a fuel advertising campaign.
As of today, the directive has entered into force and Italy is granted until March 2026 as the deadline for implementation.
THE OBJECT OF THE DIRECTIVE
Taking a more specific look, the European Union intends to make product labelling clearer and more reliable by banning the use of misleading and generic environmental claims (e.g. environmentally friendly, animal friendly or terms such as green, natural, biodegradable, eco), at least if they are not supported by evidence.
The main new developments can be summarised as follows:
Regarding “commercial practices considered unfair in any case”, as defined in Annex I of Directive 2005/29/EC, the new Directive 825/2024 adds additional problematic marketing strategies to the already existing list. For instance, it is considered an unfair practice to make environmental claims that contain ‘untruthful’ or generic information about the existence of characteristics attributed to products or, more simply, it is also unfair to make statements about properties pertaining to the entire product, when these are in fact true only about a part of it.
In particular, among the new conduct included in this blacklist, it is worth mentioning the conduct, therefore considered unlawful, of “displaying a sustainability mark that is not based on a certification system or is not established by public authorities”.
A sustainability label is any public or private, voluntary trust mark, quality label or equivalent, which aims to distinguish and promote a product, process or company by reference to its environmental or social characteristics or both, excluding compulsory labels required under EU or national law. Considering the Greenwashing Directive, only sustainability labels based either on certification schemes approved by public authorities or on standards with transparent, fair, and non-discriminatory conditions will be authorised.
Furthermore, about zero impact and climate neutrality, the directive places an absolute ban on companies claiming a neutral, reduced or positive impact on the environment in terms of greenhouse gas emissions, including CO2, because of offsetting. This does not mean preventing companies from advertising their investments in environmental initiatives, including carbon credit projects, as long as they provide this information in a way that is not misleading and complies with the requirements of EU law.
Finally, the directive addresses further points. Firstly, the focus of consumers on the durability of products: in future, warranty information will have to be more visible and a new harmonised label will be created to give more prominence to products with a longer warranty period. Secondly, the new rules prohibit unsubstantiated durability claims, false statements about the reparability of a product and the invitation to replace consumer goods earlier than necessary.
A SPECIAL FOCUS ON THE TEXTILE SECTOR
The Commission will ask the fashion industry to replace hazardous substances in textile products placed on the European market and to adopt responsible and innovative fibre-to-fibre recycling. In the light of this, manufacturers will have to take responsibility for products along their ‘value chain’, urgently defining European End of Waste legislation and harmonising rules for extended textile producer responsibility and economic incentives to make products more sustainable.