The Netherlands Authority for Consumers and Markets (ACM) has carried out a probe into greenwashing which involves assessing the sustainability claims of ten major companies.
On the basis of its findings, ACM will now launch a follow-up investigation into six companies where ACM saw the largest amount of greenwashing.
ACM requested information from two Dutch and four non-Dutch clothing companies in order to be able to assess whether or not the seemingly misleading claims are truly misleading. After assessing that information, ACM will ask the regulators in the countries of the non-Dutch companies to take action against those companies. ACM is able to take action against the two companies that are based in the Netherlands. ACM can impose fines or orders subject to periodic penalty payments on companies that mislead consumers about the sustainability aspects of their products.
Edwin van Houten, director of ACM’s consumer department, explains: “We carried out this investigation because consumers that want to buy sustainable products are entitled to correct, clear, and verifiable information. In addition, we wish to protect the companies that do follow the rules against their competitors that employ misleading practices. We see that many clothing companies like to present themselves as sustainable companies, but that they often exaggerate their claims, and that these claims are often not substantiated. We now take action against such practices, which may also include imposing fines on companies.”
In late May, ACM contacted over seventy companies in the clothing sector, asking them to take a critical look at their own claims. They had until mid-June to do so. ACM subsequently checked sustainability-related claims made by ten major clothing companies for accuracy, clarity, and verifiability of the information. ACM assessed in particular whether the companies correctly informed consumers regarding:
- The sustainability benefit of the product. This cannot be phrased using vague, absolute or general terms without any explanation;
- The use of organic cotton and the percentage of organic cotton that a clothing piece contains, if it is less than 95%; and
- Sustainability filters and sustainable collections, and the criteria and substantiation used in those contexts.
Bad examples that ACM has come across:
- A clothing company uses vague/absolute and general terms such as ‘sustainable’ or ‘ethical’ on its tags or on the main page of its website. The explanations of these terms are not directly given with the statements. In some cases, even on the product page, it is not explained what the sustainability benefit of the product is.
- A clothing company offers a special sustainability collection. The products that are part of this collection are all given a specific name, but it is unclear what criteria are used in that context. It is thus unclear what the sustainability benefit is of these products in comparison with other products.
- On a T-shirt’s tag, it says ‘organic cotton’. Information found elsewhere on the website reveals that the T-shirt contains less than 95% organic cotton. In that case, percentages or ranges of percentages of the amount of organic cotton must be given, for example: T-shirts made from 60% organic cotton.
Earlier this year, ACM published five rules of thumb for honest sustainability claims. ACM then launched investigations into misleading sustainability claims in the clothing, energy and dairy sectors, because ACM saw the most sustainability claims in those sectors. The results of the investigation into the clothing sector are the first to be published by ACM.
Apparel business professionals have previously said they see greenwashing as a major issue.