ESG Enforcement Tracker

Key facts:

The ACCC announced in March 2023 that it would be “investigating a number of businesses for potential ‘greenwashing’ following an internet sweep which found that more than half of the businesses reviewed made concerning claims about their environmental or sustainability practices”.

The internet sweep, which was launched in October 2022, found that 57% of the 247 businesses had made concerning claims about their environmental credentials. Of these, cosmetic, clothing and footwear and food and drink sectors were found to have the highest proportion of concerning claims.

The ACCC Deputy Chair Catriona Lowe, said that “Unfortunately, it appears that rather than making legitimate changes to their practices and procedures, some businesses are relying on false or misleading claims”.

As a result of its findings, the ACCC published draft guidance in July 2023, with its consultation on these concluding in September 2023.

In December 2023, the ACCC published eight principles to help businesses ensure any environmental marketing and advertising claims they make about their products or services are clear and accurate, and do not mislead consumers. These eight key principles are:

1. Make accurate and truthful claims.
2. Have evidence to back up your claims.
3. Don’t hide or omit important information.
4. Explain any conditions or qualifications on your claims.
5. Avoid broad and unqualified claims.
6. Use clear and easy-to-understand language.
7. Visual elements should not give the wrong impression.
8. Be direct and open about your sustainability transition.

The principles are set out in detail in the ACCC’s “Making environmental claims – A guide for business”, which explains the ACCC’s view of good practice when making environmental claims, as well as making businesses aware of their obligations under the Australian Consumer Law.