What Are the Green Guides and Can They Stamp Out ‘Greenwashing’?

The U.S. Federal Trade Commission (FTC) will weigh major changes for the first time in a decade to its Green Guides, a set of standards for companies making environmental claims, as it sifts through thousands of comments it received on the topic.

The FTC last December sought comment on potential changes to the Green Guides, which have been updated only three times since they were first introduced in 1992 even as the use of green claims in marketing has exploded.

The regulator received nearly 60,000 responses to questions it posed about several frequently-used environmental claims, ranging from “low carbon” to “net zero;” to claims of the recyclability, sustainability and compostability of products.

ARE THE GREEN GUIDES LEGALLY BINDING?

The guides were created by the FTC to “help companies avoid running afoul of the FTC’s ban on deceptive advertising. They have been increasingly cited in class action litigation challenging false environmental claims, known as “greenwashing.”

Law firm Dentons said that these lawsuits have been costly to manufacturers. It cited a $10 million settlement reached last year in a California federal court in which coffee company Keuring admitted to making misleading claims that its coffee pods are recyclable.

WHAT DOES THE FTC WANT FEEDBACK ON?

In its December notice seeking public comment on the guides, the commission highlighted several specific issues on which it expected the most comments, including: carbon offsets and climate change claims; the term ‘recyclable;’ the term ‘recycled content;’ and other claims like “compostable,” “degradable,” ozone-friendly,” “organic,” and “sustainable.”

One term that many commenters questioned is “net zero,” which is used by governments and companies in setting emission reduction goals and which is generally meant to suggest greenhouse gas emissions from certain sources are either eliminated or offset by other means.

In its comments to the FTC, the Center for Climate Integrity called on the FTC to define the term “net zero,” arguing that over 700 major companies have announced “net zero” targets without a clear standard for what that means.

The Environmental Defense Fund also called on the FTC to define the terms “net zero” and “carbon neutral,” suggesting that the latter represents balancing emissions with offsets while the former calls for neutralizing emissions by a certain year and reducing the rest through carbon removal projects.

HOW CAN THE FTC MAKE SENSE OF CONFUSING RECYCLING CLAIMS?

Many of the submitted comments addressed what should be considered “recyclable,” a ubiquitous claim made on packaging of almost every consumer household product. The U.S. recycling rate remained well below 10% over the four decades even as post-consumer plastic waste increased five-fold. The vast majority of plastic waste ends up in landfills or is incinerated.

Numerous commenters told the FTC that claims of a product’s recyclability should reflect where a product ultimately ends up.

A coalition of environmental groups that includes Greenpeace and Beyond Plastics said marketers should not claim products will be recycled into another products when “a substantial portion of plastic waste collected under the guise of recycling is landfilled, incinerated, or exported without verification of recycling.”

The Environmental Protection Agency said the FTC should “clarify that products and packaging may only be marketed as recyclable if they have a strong end market,” meaning the collected material can be sold for a high enough price to make economic sense.

Meanwhile, the Plastics Industry Association urged the FTC not to limit the definition of “recyclable” in that way.

“There is no consumer deception in a claim that clearly identifies that a product is in fact recyclable (with qualifiers on limits to access if appropriate), but for reasons beyond the marketer’s control becomes subject to an external factor that prevents it from being recycled,” the group said.