The Competition and Markets Authority (CMA) has just warned UK businesses they have until the New Year to make sure their environmental claims comply with the law.
To help businesses understand how to communicate their green credentials while reducing the risk of misleading shoppers, the CMA has published the Green Claims Code. This focuses on 6 principles which are based on existing consumer law. It is clear that firms making green claims must not omit or hide important information and must consider the full life cycle of the product.
A recent report by Ethical Consumer shows that the UK levels of ethical consumerism and finance reached £98 billion in 2019 – a record level. Also, that the pandemic created a growth spurt in 2020 demonstrating that consumers are making choices based on ethics when purchasing. This is good news, but it comes with a downside in that there is an increasing amount of greenwashing.
With the pressing need for businesses to make good on their claims, those that are genuinely sustainable will be looking to external accreditation to provide evidence and help to create trust with their customers. The accreditation process audits everything from supply chain to the final product or service.
There is much evidence to show that achieving a respected certification gives consumers peace of mind when making their choices and can drive business growth. A survey conducted by Futerra demonstrated that 88% of consumers would like brands to help them make more environmentally friendly and ethical choices.
For sustainable businesses to be successful, it is essential that they demonstrate that they are not greenwashing and make it easy for consumers to understand what they are buying and how their product is more sustainable and less environmentally damaging than a competitor.
So how can businesses inspire a feeling of trust with their customers?
Sadly, some familiar accreditors have reduced the level of confidence consumers have in schemes, as they have not policed properly and / or have not been clear as to what they are policing. So, firstly, make sure you chose the right accreditation: one that will stand up to scrutiny from the consumers who care and will do their research. This means looking at every angle and ensuring that the accreditors are really doing their job properly. This can be achieved by working collaboratively with accreditors and both parties holding each other accountable. A final and crucial check is to see what the accreditor is looking to achieve by working with your business ‘ you need to be confident that reputation is more important to them than profit!
We all know the planet is in trouble. You can hardly avoid it, much as businesses can’t avoid consumers making their buying choices accordingly. They want the brands they purchase from to not only be ethical and sustainable but also to go further than that, wherever possible, and will choose brands that are having a positive effect on reversing climate change.
If you are doing that, make sure you have the right accreditation to demonstrate it, as that is crucial to your business success!
References
https://www.ethicalconsumer.org/research-hub/uk-ethical-consumer-markets-report
Futerra Survey – https://www.forbes.com/sites/solitairetownsend/2018/11/21/consumers-want-you-to-help-them-make-a-difference/?sh=afe776869547
https://www.fastcompany.com/90306556/most-millennials-would-take-a-pay-cut-to-work-at-a-sustainable-company
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