ESG Enforcement Tracker

Key facts:

In April 2024, the ACCC filed a claim against Clorox in the Federal Court alleging, that it had made false or misleading environmental statements by supplying bin bags which were marketed as “50% ocean plastic recycled”. The ACCC state that, in fact, the recycled plastic in the bin bags was collected from communities situated up to 50km from the shoreline.

Between June 2021 and July 2023, Clorox supplied kitchen tidy bags and garbage bags to supermarkets and retailers. The front and side of the bags each included the phrase “GLAD to be GREEN” and “50% OCEAN PLASTIC RECYCLED BAGS”. The original kitchen tidy bags also contained the phrase “MADE USING 50% Ocean Plastic*”. Later versions of the kitchen tidy bags, and all relevant garbage bags, contained the amended wording of “MADE USING 50% Ocean Bound Plastic*”.

The packaging included the following fine print: “*Made using 50% ocean bound plastic that is collected from communities with no formal waste management system within 50 km of the shore line”. The updated version of the product was amended to clarify that it was “made using 50% ocean bound recycled plastic…”. The products were reportedly withdrawn in 2023.

The ACCC claims that, despite the caveats included in the fine print, and the references to ocean bound, Clorox represented to consumers that the bags constituted 50% recycled ocean plastic collected in the sea, ocean, or shoreline rather than communities 50km from the shoreline.

The proceedings were issued on the grounds that this representation was misleading or deceptive, or likely to mislead or deceive consumers as to the composition, environmental benefits and manufacturing process of the bags, in contravention of the Australian Consumer Law. The ACCC asserts that this deprived consumers of the opportunity to make informed decisions relating to the environmental benefits of competing products and may have undermined competition as a result. The ACCC is seeking, among other orders, declarations, penalties, an order to implement a compliance program, corrective notices and costs.

This claim is part of the ACCC’s wider strategy, announced in March 2023, of investigating companies for potential ‘greenwashing’ marketing or advertising claims, and is indicative of more claims of a similar nature to come.

In December 2023, the ACCC released its guidance on making environmental claims for businesses, which explains business’ obligations under the Australian Consumer Law when they make environmental and sustainability claims.