ACCC and ASIC continue to pursue compliance and enforcement activity in relation to greenwashing.
ACCC internet sweep and guidelines
The ACCC recently conducted an internet sweep of 247 businesses to identify misleading environmental and sustainability marketing claims. The review included businesses across eight sectors including energy, motor vehicles, home appliances, garments, household products, food and beverages, cosmetics, and takeaway packaging. Of the businesses reviewed, 57% were found to have made concerning claims about their environmental or sustainability practices.
On 14 July 2023, the ACCC released draft guidance for businesses that includes relevant examples of greenwashing claims and case studies on best practice approaches. View the ACCC guidelines here.
The ACCC gives various examples which reflect the existing law not to make claims that are vague, misleading, inaccurate or relate to the future without reasonable basis. The ACCC’s examples of problematic claims include claiming:
- a product is “Green”, “Eco” or “environmentally-friendly”;
- a product is “made from recycled materials” when the product is only partially made of recycled materials;
- a cosmetic product “does not harm the environment” when only the bottle is made from recycled materials and not the external packaging;
- a business will reduce its emissions by 80% in the next 5-years without basis;
- a product “does not contribute to deforestation” without knowing the origin of the wholesale supplies;
- a cosmetic product is “plastic-free” but in small print limiting that claim to only the bottle and not the cap and pump;
- a product is “recyclable” when it can only be accepted for recycling in a small number of locations; or
- using the recycling symbol when a product is not recyclable.
ASIC commences its first Court proceedings for alleged greenwashing
In February 2023, ASIC commenced civil penalty proceedings against Mercer Superannuation for alleged greenwashing conduct in relation to statements about the sustainable nature and characteristics of some of its superannuation investment options. ASIC alleges that Mercer made statements that certain investment options excluded investments in companies involved in the production or sale of alcohol, gambling or the extraction or sale of carbon intensive fossil fuels, however investments were made in companies involved in such industries.
ASIC infringement notices and corrective disclosure outcomes
| Business | Allegation | Outcome |
|---|---|---|
| Tlou Energy Ltd |
Representations related to carbon neutrality, environmental approval and capability regarding solar power, low emissions, and being equally concerned with producing clean energy through renewable sources as with developing its gas-to-power project |
4 infringement notices - $53,280 total |
| Vanguard Investments Australia Ltd |
False representations about a system to prevent investment in companies involved in the production, manufacturing, or significant sales of tobacco |
3 infringement notices - $39,960 total |
| Diversa Trustees Ltd |
Representations overstated system to prevent investments in companies engaging in polluting and carbon intensive activities, activities which cause environmental or social harm and poor corporate governance |
1 infringement notice - $13,320 total |
| Black Mountain Energy Ltd |
Representations related to ‘net-zero carbon emissions’ and net zero greenhouse gas emissions |
3 infringement notices - $39,960 total |
| Future Super Investment Services Pty Ltd |
No basis to represent that the entirety of $400 million in funds under management had been invested in fossil fuels prior to being invested in its fund |
1 infringement notice - $13,320 total |
ASIC has also reported 23 corrective disclosure outcomes relating to alleged greenwashing between 1 July 2022 and 31 March 2023, including in the mining, finance and energy industries. This has involved companies removing representations from a prospectus or website or providing clarifying information.
