Now that sustainability has become a mainstream issue, advertising relating to the green credentials of a wide array of products is becoming more prominent. But is it all too green to be true?
When it comes to the marketing of environmentally friendly products, consumers and businesses are well aware of the green onslaught.
Since sustainability became a mainstream, everyday issue, what is known as 'green washing' has been applied to a vast range of consumeables, ranging from energy-rated electrical appliances to goods made from recycled materials, eco-friendly packaging, water conservation campaigns, bio-degradable products and petrol-saving motor vehicles.
However, the impending introduction of carbon emissions trading, and the creation of a carbon trading market, has seen a new wave of green washing and a major challenge for trade practices regulators and consumer watchdogs.
Key consumer and advertising standards bodies worldwide have acknowledged that the complexity of the carbon trading market is as confusing for business in terms of what its obligations might be as it is for the end user of products and services.
While general 'fairness in advertising' or 'false and misleading' provisions apply to all claims made in advertising, this is largely being seen as a holding pattern in regard to the multi-billion-dollar carbon market that has already been unleashed, until strict verification guidelines are agreed on.
Another major hurdle consumer regulators face is that while carbon emissions are seen as causing a global environmental outcome, consumer laws can vary enormously from country to country and even within countries where there are various levels of government.
Consumers are already being offered cars with a promise that a tree will be planted to offset its carbon emissions when they purchase theirs. Taxi companies in the UK can make and advertise themselves as carbon neutral if they buy carbon offsets from a company specialising in this area.
A phone services provider in the UK suggests that for a certain number of phone calls made by an individual on its network, the company will offset 100kg of CO2 emissions through a tree-planting project in Uganda.
Some airlines have begun offering to sell carbon credits along with a ticket, but it's an optional cost-based extra. A luxury goods manufacturer can offset its high-gloss advertising by planting bamboo on islands off Indonesia. We can buy everything from computer printers and monitors to homewares, coffee and clothes that claim carbon neutrality.
Australia's Competition and Consumer Commission (ACCC), America's Federal Trade Commission (FTC), the British Advertising Standards Authority and the European Union's consumer protection authorities are all examining how to tackle carbon-specific issues.
In many instances, federally based consumer protection runs into state-based consumer provisions. For instance, in the US, the state of California is already moving towards tougher new legislation to address carbon offset claims while federal authorities continue to hold public consultation sessions and issue guidelines that lack legislative teeth.
In Australia, the ACCC has publicly questioned whether current advertising in relation to products claiming carbon credits are too green to be true.
Since January this year it has been issuing discussion papers on the subject and has now produced what it terms guidance materials to alert businesses to their obligations under the Trade Practices Act and point out potentially problematic areas. To this end, the ACCC has created a new environmental claims section on its website where Carbon Claims and the Trade Practices Act as well as Avoiding Hot Air: A Consumer Guide to Carbon Claims can be accessed.
The US FTC's guidelines for advertisers concentrate on overall green claims including sales pitches such as 'environmentally safe', 'recyclable,' and 'biodegradable,' in order to urge consumers to be wary of general claims that 'sound warm and fuzzy' and to fully examine exactly what is being sold to them. The EU has warned advertisers to expect increased scrutiny of its carbon claims.
Worldwide, the growth of companies that provide carbon offsets is increasing rapidly. They include a mixture of private enterprise and not-for-profit organisations. Many are based on tree-planting programs, shares in which are on-sold to other companies seeking carbon credits.
Others are involved in 'carbon capture' projects or the purchase of carbon credits sold on the carbon credits market.
ACCC chairman Graeme Samuel concedes that the issue is complex and technical. 'The difficulties in understanding and verifying carbon claims give rise to concerns that consumers may be facing misleading and deceptive conduct associated with this emerging market,' Samuel says.
He said there had already been investigations, including a claim by a power company that said using its electricity would be the same as 'not driving your car for two years.'
Another claimed it provided '100 per cent green electricity' at no extra cost. To this end, the ACCC's guides have examined issues such as forward-credited offsets, low-quality offsets and carbon neutrality.
'Our focus is on ensuring that appropriate steps are taken by business so that claims of carbon offsets or carbon neutrality are not misleading, and that these claims are clear and understandable for consumers,' Samuel says.
Central to the regulators' considerations is a list of specific issues. The key areas listed by the ACCC include:
The effectiveness of the offset. The lack of accepted standards relating to carbon credits means that consumers may be misled as to the effectiveness of particular offsets at yielding reductions in carbon emissions. For example, the effectiveness of tree planting as a method of offsetting carbon emissions is highly variable and often disputed.
Accuracy of the carbon footprint calculation. The process of auditing carbon emissions is currently unregulated, so there are no clear standards as to how a carbon footprint is measured. A product or service claiming to be carbon neutral may only be 'green' to the extent of a potentially inaccurate carbon calculation.
False claims of carbon neutrality. The ACCC is concerned that companies may make claims as to carbon neutrality that are simply false and in breach of the Trade Practices Act.
Claims as to future carbon neutrality. These are also potentially misleading where there are insufficient disclaimers as to expected timeframes of the offset process.
Claims of 'low carbon'. Where the proportion of carbon neutrality is not specified, the ACCC is concerned that consumers could be misled as to the extent to which carbon emissions associated with a product or service have been offset.
The ACCC's guides have only been issued electronically 'in deference to environmental concerns.'
