As consumers actively seek more environmentally friendly products and services, companies have increased “green” advertising efforts to highlight eco-friendly claims and certifications related to carbon emissions, renewable energy and recycled materials. In response to this increase in “going green” marketing, the Federal Trade Commission (FTC) proposed revisions to its Guides for Use of Environmental Marketing Claims (Green Guides) to provide additional guidance to companies on what kinds of environmental claims can be made and how such claims must be substantiated to avoid legal challenges, penalties or negative publicity.
On May 23, 2023, the FTC hosted a workshop titled “Talking Trash: Recyclable Claims and the Green Guides” to discuss its proposed revisions. The workshop examined the FTC’s guidance on “recyclable” advertising claims as part of its ongoing review of the Green Guides and discussed consumer perception of current and emerging recycling-related claims. A recording of the workshop is available online.
THE GREEN GUIDES 101
The FTC’s Green Guides were published in 1992 to guide advertisers that make environmental claims and prevent claims that may mislead consumers. Revised in 1996, 1998 and 2012, the Green Guides provide direction around environmental marketing claim principles, consumer interpretation of claims and claim substantiation, and qualification of advertising claims to prevent deceptive practices. Marketing claims covered by the Green Guides include the following:
Environmental certifications or seals
Content that is recyclable, compostable or degradable
Renewable materials or energy
General environmental benefit claims.
FTC PROPOSED REVISIONS AND REQUEST FOR PUBLIC COMMENT
The most recently revised Guides were released on October 11, 2012. Now, a decade later, the FTC has proposed revisions again—and asked for public comment on such proposals—to improve guidance for advertisers given the spike in “green” marketing by companies at large. If enacted, the proposed revisions would update guidance on claims currently covered in the Green Guides and would also introduce guidance for new claims arising out of the increased environmental research that has taken place over the last decade. These revisions could significantly impact advertisers that make “green” claims by requiring more specificity and more substantiation than before.
The FTC’s requested public comment period closed on April 24, 2023. The FTC’s request for comments centered on the effectiveness of the current Green Guides, whether they have provided benefits or imposed costs on consumers and businesses, and whether the industry has generally complied with the guidance. The request for public comment further asked how society has changed with respect to environmental interest and causes in the last decade, and whether the Green Guides should remain mere guidance or if the FTC should propose rulemaking to formalize the principles.
The FTC also sought comments on specific environmental marketing claims, including “recyclable” claims and the level of substantiation required to make these claims given the advancement in technology and manufacturing of recyclable products, and the increased awareness of and standards around recycling practices. The FTC sought public input on whether the existing threshold should be increased and what constitutes a “recyclable” product.
The Guides currently do not address the terms “sustainable,” “sustainability” or “organic,” the use of which has significantly increased in the market over the past 10 years. Thus, the FTC requested comments on whether to issue new guidance on the reasonable consumer interpretation of these terms. The FTC is also contemplating whether new guidance is required for climate-change-related claims (since the current Guides only address carbon offset claims) and terms such as “net zero emissions” or other increasingly popular comparative claims that center on carbon footprints and reduced emissions. Additionally, the FTC is considering whether the Green Guides should provide guidance on claims related to energy use or energy efficiency (e.g., as they relate to electric vehicles).
The FTC’s focus on green claims is part of the agency’s overall increased enforcement of advertising claims across many industries recently. The FTC seeks to bring the Green Guides up to date with the public’s ever-increasing focus on the environment and companies’ use of “green” claims in marketing. Additionally, with the Biden administration’s focus on environmental impact and protection, companies are bound to increase their use of environmentally friendly products and services to keep up with the times, and in doing so, increase their “green” claims. Thus, it is important that the FTC provide clear guidance to the companies that would be impacted by the proposed Green Guides revisions.
While it may take months for the agency to review comments and incorporate the proposed revisions, companies should act now to take inventory of all environmental claims made in advertisements or on their websites and ensure that sufficient substantiation exists and is maintained to support all claims made.