Blue Standard

Blue Brief: EU Greenwashing Regulation

Katrina Pugh, PhD., Elizabeth DiSanto, and Katherine Guerrero
For more information, contact [email protected].

On 26 March 2024, the EU’s Empowering Consumers for the Green Transition Directive and its companion, the Green Claims Directive, went into force. The Green Claims Directive requires third-party verification for environmental marketing claims to protect individuals from misleading advertising or “greenwashing.” This Blue Brief provides a snapshot of what the new law states, what this means for consumers, what this means for businesses, when it will take effect and how the Blue Standard can be a solution.

The Blue Standard (Blue) by Oceanic Global is a first of its kind cross-industry sustainability standard that empowers industries and businesses to reduce single-use plastics and enhance sustainable operating practices to protect our Blue Planet.

In January of 2024, the European Parliament voted 467-65 giving its final green light to the new Directive, Empowering Consumers for the Green Transition (ECGT).

  • The law states that environmental marketing claims must be validated by reliable parties and third-party verifiers. 
  • Among other new restrictions, claims that advertise a neutral, reduced, or positive impact on the environment because the producer is offsetting carbon emissions will be banned.
  • The ECGT entered into force 26 March 2024. Member states will need to apply the new rules by 27 September 2026. 

The Green Claims Directive is the parallel legislation which specifies how claims get verified

  • The Green Claims Directive requires that businesses making sustainability claims provide data to back up those claims, and that the claims are verified by a third-party.
  • The Green Claims Directive is the “companion” of the ECGT legislation, and will be shaped by a Green Claims Consultation Forum that will allow for external parties to weigh in on the details of the Green Claims Directive.

The new law will steward rigorous oversight over environmental claims and sustainability labels in Europe.

  • There is a requirement for third-party verification to ensure the reliability of the claims, and that companies are not unfairly disadvantaged by competitors who engage in greenwashing.

This matters because, according to the EU’s own assessment, almost half of the 230 approved “Ecolabels” in Europe today have weak verification or little transparency, according to the EU’s own assessment.

  • Companies will need to change their operating practices, and consumers will now have more insight and information into products and services they decide to purchase.

The ECGT and the Green Claims Directive will help consumers to make better purchasing decisions and will ban companies from using greenwashing claims.

From a legal perspective in the EU, primarily consumer-facing businesses will have to undergo sustainability verification processes to be compliant with the new regulation and to mitigate legal and reputational brand risks.

  • This could result in standards for (and harmonization of) some Ecolabels.
  • Verifications could even include life cycle analysis and assessments of sustainability footprint claims.

Businesses outside the EU will soon have to follow suit, due to international supply chains and markets.

  • Global businesses will want to show that their operations are aligned with ECGT and the Green Claims Directive – thereby enhancing public confidence through third party verification systems.

Proposed fines for not abiding to these regulations will be at least 4% of annual revenue, alongside exclusion from procurement processes, and confiscation of revenues.

The Blue Standard (Blue) helps businesses & industries of all sizes demonstrate compliance with global sustainability regulations and reporting requirements.

  • Blue also empowers consumers to help stop greenwashing, as they can reference the claims of Blue Verified businesses and products on the Blue Business Directory.

Blue will be an implementation partner to ensure EU and global businesses make compliant claims, and are meeting the new EU requirements.

Blue verifies sustainability claims, offers transparency, provides accountability and standards-compliance, and empowers consumers to seek the Blue Seal.

The Blue team will continue to track the evolution of the ECGT and Green Claims Directive, and will provide updates and tactics to help businesses and our Blue Consultants to comply as it unfolds throughout the EU and beyond.

European Union Documents/Sites

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