Green claims update: February 2025

Welcome to our round-up of the key legal and regulatory developments relating to green claims. If you have any questions about this, or about wider ESG and sustainability regulatory developments, please get in touch.

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Key updates

CMA's consults on draft consumer law guidance

The CMA has recently consulted on draft guidance to help businesses comply with the revamped consumer protection rules under the Digital Markets, Competition and Consumers Act 2024. The guidance summarises key changes including broader definitions of "commercial practices" and "misleading actions" making it easier to enforce against misleading green claims. Coupled with the CMA's expansive new enforcement powers (due April 2025), the UK green claims regulatory landscape is set to get more challenging.

The EU's new simplification drive

 The EU Commission has published its 2025 Work Programme and 'Competitiveness Compass' with a focus on reducing the regulatory burden for businesses. This includes a proposed 'simplification omnibus' to streamline the EU's flagship sustainability legislation - the CSRD, CSDDD and Green Taxonomy. Whilst the EU is pushing ahead with its new Green Claims Directive, it remains unclear how this new 'simplification' agenda might impact the shape of the final text, particularly onerous requirements around third party verification of claims.

Green Claims Directive negotiations kick off

Trilogue negotiations on the EU's Green Claims Directive kicked off in January with agreement expected later this year. The Directive is expected to introduce extensive new rules for business making green claims in the EU. See our overview of the key negotiation areas here. 

CAP and BCAP consult on removing emerging labelling rules

 CAP and BCAP are consulting on removing energy labelling and product fiche rules from their advertising codes, on the basis that the ASA has received no complaints under these rules, and the underlying energy labelling legislation is already effectively enforced by the Office for Product Safety and Standards (OPSS). The consultation is open until 4 March 2025.

ASA CEO's "golden rules" to avoid greenwashing

 In a recent interview, ASA CEO Guy Parker highlighted three 'golden rules' for preventing greenwashing: (1) avoid absolute green claims; (2) focus on near-term progress rather than long-term or aspirational goals; and (3) be "humble" and transparent about challenges – this makes for more credible ads.  

ASA rulings

Lloyds Bank

 The ASA has ruled that an ad by Lloyds Bank claiming it was helping to "accelerate the transition to a low carbon economy" and "putting the weight of (its) finance into clean and renewable energy" breached the CAP code by omitting material information about Lloyds Bank's financed emissions. The ad gave a misleading impression that renewable energy was a significant proportion of Lloyds Bank's investments when this was not the case.

eDreams

 The ASA has upheld complaints against the online travel agency eDreams for ambiguous claims that its trips were "sustainable". To substantiate an absolute "sustainable" claim eDreams would have to show its trips were not environmentally damaging. It was not sufficient to rely on a self-selected list of eight criteria used to determine whether a destination was "sustainable".

Scottish Power

 The ASA has ruled that a TV ad by Scottish Power shown during the ad break for 'George Clarke's Amazing Spaces' blurred the line between advertising and editorial content. The ad promoting Scottish Power's green energy tariffs was not quickly recognisable as an ad nor distinguishable from editorial content, in breach of the BCAP Code.

Flooring by Nature

 The ASA has ruled that claims made by carpet manufacturer Flooring by Nature that its wool carpets were "eco-friendly", "biodegradable", and a "sustainable alternative to synthetic carpets" had not been substantiated. In particular, some of its carpets used plastic backing and the ads did not sufficiently explain to consumers how to dispose of them to successfully biodegrade.

Sector-specific updates

Transport

 The ASA has reportedly reached an informal resolution with MSC Cruises, who have agreed to withdraw ads promoting liquified natural gas as a "cleaner fuel" on the basis that this gives a misleading impression of its carbon impact. This follows a previous ruling by the Dutch Advertising Code Committee against MSC Cruises' green claims – see our Green claims update: October 2024.

Consumer goods

The Carbon Trust has launched a new online directory enabling consumers to search for products with a verified carbon footprint label. The directory includes GHG emissions data and the associated Carbon Trust certificate enabling businesses to substantiate carbon claims.

Proctor & Gamble is facing a class action in the US for alleged greenwashing in relation to its Charmin toilet paper. The claimants accuse P&G of making false and misleading claims about its sustainable sourcing of wood pulp and its commitment to reforestation, alleging breaches of Federal Trade Commission's Green Guides.

Advertising services

 Adfree Cities and New Weather Institute have filed a landmark complaint against the advertising company WPP under the OECD Guidelines. The complaint accuses WPP of contributing to adverse human rights and environmental impacts through its advertising and lobbying services to clients. The complaint calls on WPP to disclose its advertised emissions and to stop acting for high-polluting industries.

Publications

Regulatory Radar – Winter 2025: 'ESG'