Yahoo Finance Tesco, M&S and Primark among brands hesitant to make some green claims over greenwashing action
Big retail brands including Tesco and Primark are hesitant to make some green claims despite the majority embracing sustainable practices over fears of being hit with greenwashing action.
This is according to exclusive data shared to City A.M. by AI compliance platform Compare Ethics. The report was focused around the practices of 24 of the UK’s biggest retailers including Primark, Tesco, John Lewis, Marks & Spencer and New Look.
Recently, there was fresh updates to consumer protection law in multiple markets, including the UK’s Green Claims Code, which puts demands on brands to ensure that their environmental claims are robust, specific, and substantiated.
Now, if a business fails to comply with these laws it could face severe consequences which includes legal action, hefty fines, and reputational damage.
According to the data, a mere five per cent of the retailers are currently making durability claims, which focus on the expected lifetime of a product, while just 5 per cent are making circularity claims.
In contrast, brands find it easier to substantiate green content claims, which focus on features such as the use of recycled or organic materials, with 78 per cent making these types of claims.
Lacking confidence, and clarity
With that, the report highlighted that many brands lack confidence around how to comply with these
requirements, making them hesitant to make claims.
The British brands that participated in this report are looking for clarity on the regulatory requirements in order to avoid any greenwashing claims.
This includes a clearer understanding of what data is needed to meet standards from the Competition Markets Authority (CMA). Last month, the competition watchdog issued an open letter to the retail sector, urging a thorough review of green claims.
Brands such as ASOS, Boohoo, and Asda have already signed formal agreements that commit them to clearer and more accurate environmental claims after they were investigated by the regulator for greenwashing.
Commenting on the findings, CEO Abbie Morris said: “Our findings show the urgent need for confidence in green claims. Brands need to be empowered with the right information that will enable them to confidently communicate their sustainability achievements and further invest in the green transition.”
“Only by doing so can retailers enhance consumer trust and help regulators to protect the public on this critical issue. Failing to act now could result in a major missed opportunity not just for business but also for the planet.”
“That is why we have consulted with major retailers to create a shared data standard for environmental claims that will level the playing field and provide a blueprint for sustainable practices within the retail industry,” she added.
The consultation that led to the creation of the Data Standard, which Compare Ethics intends to share with the CMA and global competition authorities to help inform their more formal regulatory guidance on how retailers can make accurate claims.
