CMA’s New Green Claim Guidance for Fashion Businesses

The CMA also sent letters to 17 fashion brands advising them to review their green claims and highlighting the use of broad and general terms and whether certain products were wrongly being included in ‘eco’ ranges.

It is important that fashion businesses take note of this new practical guidance as the Digital Markets, Competition and Consumers Act 2024 (due to come into effect in April 2025) will allow the CMA to impose fines of up to 10% of a business’s global turnover for breaches of consumer protection law.

To date, the CMA has already led investigations into the practices of ASOS, Boohoo and George at Asda, with the CMA securing landmark changes in the way these brands display, describe, and promote their green credentials.

The new guidance continues to demonstrate how the CMA is committed to prioritising the protection of consumers from misleading green claims, particularly at a time where consumers are increasingly seeking environmentally sustainable products and services.

CMA Guidance

The CMA guidance applies to all claims made about a ‘product’. This includes all goods and services (such as delivery, distribution and returns), advertised both instore and online (including via websites and social media).

The new guidance is based on the six key principles set out in the CMA’s Green Claims Code that claims must:

1. Be truthful and accurate: Any environmental claim must reflect the true reality of the product. This means that businesses must avoid making misleading general statements, such as “100% sustainable” or “fully recyclable,” unless they can provide evidence to substantiate those claims.
2. Be clear and unambiguous: Vague terms like “eco-friendly” or “green” are unlikely to comply with the guidance unless accompanied by clear explanations of the specific environmental benefit. Consumers should understand exactly what makes a product sustainable without needing to conduct their own research.
3. Not omit or hide important relevant information: Fashion brands must provide full information to consumers. For example, a product might contain recycled materials, but if the majority of the product is made from non-recycled materials, this should not be downplayed. Omitting critical information is likely to mislead consumers.
4. Be fair and meaningful: If a business compares the environmental benefits of one product to another, those comparisons must be fair and based on clear criteria. Any comparison should focus on the full lifecycle of the products being compared, rather than cherry-picking favourable points.
5. Consider the full lifecycle of the product: Claims should consider the full lifecycle of the product, from production to disposal. For example, stating that a garment is “recyclable” without considering the practical availability of recycling facilities for that product may be deemed misleading

6. Be substantiated: All claims must be backed up by solid evidence. Fashion businesses need to ensure they can prove their environmental claims with verifiable data. For example, if a brand advertises a product as being made from “sustainable materials,” it should have certifications or research that support that claim.

Integrating Compliance Into Business Practices

The CMA’s guidance also highlights the importance of internal processes to ensure that environmental claims are accurate and reliable. Fashion brands are encouraged to establish internal policies and processes to prevent greenwashing. This includes:

• Staff Training: Ensuring marketing, sales, and product development teams are well-informed about the legal requirements and the company’s sustainability policies.
• Supply Chain Due Diligence: Verifying the environmental credentials of suppliers and ensuring that claims made about products reflect their entire lifecycle, from production to disposal.
• Internal Processes: Establishing regular checks to ensure products marketed as part of eco-ranges meet the criteria set by the brand and comply with consumer law.

By implementing these internal processes, fashion brands can ensure their claims are as credible as possible, reducing the risk of misleading consumers and falling foul of consumer protection laws.

Conclusion

The CMA’s new guidance underscores the importance of transparent and truthful environmental marketing. The new guidance should come as a useful reminder to businesses that adhering to the  principles of the CMA’s Green Claims Code will help to ensure compliance with consumer laws and build consumer trust in their sustainability efforts.

How can we help?

For fashion businesses navigating this complex area, seeking legal advice on compliance is an essential step to avoid potential pitfalls. If you would like to discuss this further, please contact Susan Honeyands, Lucy-Beth Pearl or one of our other retail specialists.