The ISO Show #210 What is the EU Green Claims Directive
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Greenwashing is a concern for both businesses and consumers. The proliferation of it in recent years has caused genuine green claims to be treated with an air of caution rather than being rightfully celebrated.
It’s become clear that there is a need for transparent and substantiated green claims, both to help consumers and stakeholders to make informed decisions and to ensure that real steps towards sustainability are being taken.
Is the upcoming EU Green Claims Directive the answer we’ve been looking for?
In this episode Mel is joined by Charlie Martin, CEO and Founder of The Anti-Greenwash Charter, to discuss the purpose of the EU Green Claims Directive, who it applies to and what it’s requirements for substantiation and verification mean in practice.
You’ll learn
· What is the purpose of the EU Green Claims Directive?
· What are the drivers behind this objective?
· Who is required to comply with the EU Green Claims Directive?
· What do the requirements for substantiation and verification mean in practice?
· How will the directive impact the use of carbon offsetting and carbon neutrality claims within the EU?
Resources
· How can The Anti-Greenwash Charter can help with the EU Green Claims Directive
· Green Claims Policy Template
In this episode, we talk about:
[00:30] Episode Summary – Charlie Martin joins Mel to discuss the upcoming EU Green Claims Directive, who it applies to and what it’s requirements mean in practice.
[02:30] What is the purpose of the EU Green Claims Directive?: This directive is a new law, not simply a voluntary scheme that businesses can opt into.
It’s a regulation that governs all voluntary green or environmental claims made by organisations operating within the EU, and requires data to back these claims up.
Another key fundamental of this directive is the need for independent verification of any claims before they’re made public.
[04:35] What are the main drivers for the EU Green Claims Directive?: One of the key drivers is combatting the rampant rise in greenwashing. It’s created a culture of mistrust around green claims, which makes it difficult for stakeholders and consumers to make informed decisions on who to work with or buy from.
Greenwashing also makes it harder to tackle bigger environmental concerns. With misleading data, we can’t accurately measure businesses impact on the environment, which is essential if we are to take meaningful action to reduce our impact.
Ultimately, greenwashing practices are slowing down our ability to effectively reduce our impact as a collective. We are at a point where sustainability related decisions need to be made quickly.
[08:00] Clearer Communications: This directive also has more control over what you can and can’t say in relation to green claims. By waiting until that independent verification has occurred, businesses can feel confident in the information they’re communicating.
[09:30] What is Green Masking? Coined by Carbonology, green masking is where organisations are essentially marking their own homework and hiding behind that fact. It’s where no independent verification has taken place, which can result in a lack of accuracy and transparency.
[10:25] Who needs to comply with the EU Green Claims Directive? – This is an EU based regulation, so if you’re located within the EU you will be expected to comply with this law.
If you do business within the EU, so if you’re based in the UK and sell to Europe, then you will also fall under this jurisdiction as well.
[11:25] What is required by the EU Green Claims Directive?: A full summary of the directive’s requirements can be found on the EU website. A simple break down of these requirements is also available on The Anti-Greenwash Charter website.
Charlie recommends familiarising yourself with the EU Green Claims Directive requirements initially, which are written to suit how businesses generally operate. He also advises that you seek legal assistance as well as sustainability and marketing experts or consultants to get a full picture of how you can comply with these requirements.
[13:35] There is an emphasis on substantiation and verification in the EU Green Claims Directive – what does this mean in practice? A green claim doesn’t account for much if you’re marking your own homework. For it to be truly substantiated, it needs to be verified by an independent third party.
The Directive also highlights the need for life cycle data, and its inclusion within the verification process. This will give businesses a more wholistic view of the impact of the materials they use, the products they use and services they deliver.
Charlie encourages businesses to get a head start on this now, not only due to the benefits it can bring but also to get ahead of the tightening of sustainability legislation that is coming down the road for the UK.
[16:15] How will the directive impact the use of carbon offsetting and carbon neutrality claims within the EU? Businesses are going to have to be crystal clear in their terminology in terms of their substantiated claims.
There is going to be a lot more scrutiny on the quality of evidence provided for carbon claims, so businesses may want to outsource help with analysing the relevant carbon data and communicating any claims and offsetting efforts.
[18:25] Is the Directive ambitious enough? Or could it be strengthened? – Previous attempts to enforce sustainability regulations have been rather weak, and time will tell if this EU Directive is set to change that pattern.
Charlie praises the Directives approach to best practice, though that will evolve further as time goes on. He thinks that the use of generative AI and how that impacts and influences sustainability communications needs to be considered further.
It’s all still quite new, so this may be added in down the line. The Anti-Greenwash Charter already have considerations for responsible AI use within communications and data processing within their Green Claims Policy Template.
They caution any signatories of their Charter to be very careful with the use of AI to support data collection and analysis, as it has the tendency to ‘hallucinate’, and companies will be held responsible for any mishaps related to incorrect results provided by AI.
[23:00] What are the potential consequences for businesses that fail to meet the requirements of the EU Green Claims Directive? – The penalties will be significant, including both fines and potential bans in areas such as marketing, advertising and promoting sustainability claims on the basis of malpractice.
Time will tell on how these penalties are delivered and to what extent within the EU and UK. It shares similarities with other regulations, such as ESOS, where a phased approach was implemented for organisations that met certain criteria.
[25:00] How can The Anti-Greenwash Chater help organisations comply with the EU Green Claims Directive? – Since it’s inception in 2022, they have paid close attention to the Directive’s development, utilising any improvements and iterations to bolster their own process.
As a result, a lot of the work they do with signatories directly aligns with and facilitates the delivery of the foundations of the Directive.
Examples of this include:
Independent verification – Their Green Claims Policy has to include a green claims database, so any claim that a business want to make has to have the relevant data to back it up. It also requires specification of what third party that business used to verify that evidence.
Accessibility of evidence – This is stressed within the EU Green Claims Directive, and is easily fulfilled with the creation of a green claims database as specified by The Anti-Greenwash Charters’ Green Claims Policy.
A full summary of how The Anti-Greenwash Charter can help with compliance to the EU Green Claims Directive is available on their website.
[27:55] How will the EU Green Claims Directive will impact consumer trust in environmental claims? – There’s currently an issue with the flooding of sustainability related communications. With greenwashing so rampant, making an informed decision as a consumer is really difficult.
The standardisation of sustainability credibility and substantiation is what the EU Green Claims Directive aims to do. Ultimately, it will act as a trustworthy marker for stakeholders and consumers to make an informed decision quickly.
If you’d like to learn more about The Anti-Greenwash Charter, visit their website!
If you’d like any assistance with carbon standards, get in touch with Carbonology, they’d be happy to help!
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