Insights

The GLAD Case and the Perils of Misleading Environmental Claims

1 May 2024

By April Thomas and Paige Tasker

The rising tide of consumer demand for environmentally friendly products has seen brands racing to showcase their green credentials. Environmental claims can be an extremely powerful tool. However, amidst this green rush, a concerning trend of greenwashing—where companies misleadingly tout their products as environmentally beneficial—has surfaced.

In Australia, the Australian Competition and Consumer Commission (ACCC) is intensifying its efforts to curb these deceptive practices. The recent legal action against Clorox Australia Pty Ltd for their GLAD-branded bags is a prime example of how the ACCC is not just watching, but actively pursuing those who make dubious environmental claims. This development signals a stern warning to all brands: the ACCC is serious about enforcing its guidelines to ensure that environmental claims are transparent and truthful.

The GLAD Case

The ACCC has recently alleged that Clorox Australia Pty Ltd – the company that owns GLAD – made misleading environmental representations on the packaging of their GLAD kitchen and garbage bags.

The big issues here were that:

• Clorox claimed their bags were made of “50% ocean plastic” collected from the sea or ocean; and
• The bags were blue and used wavy imagery to represent that they contained plastic collected from the ocean.

However, in reality the bags were made from plastic collected from communities in Indonesia up to 50kms from the shoreline.

Clorox did have two qualifying statements on the back of the packaging, but these were in tiny font. They then updated the packaging to say, “Ocean Bound Plastic”, but this wasn’t enough to stop the ACCC pursuing them in court.

Follow the ACCC Guidelines for Making Environmental Claims

For any business considering making environmental claims on its packaging, media statements or advertising we recommend following the ACCC guidelines released in December 2023.

What Do the ACCC Guidelines say?

In summary, the guidelines set out 8 key principles you should consider. They are:

1. Make accurate and truthful claims

Any claim you make about a product should be true and accurate. You should also consider the overall impression you make – even factually correct claims can mislead consumers.

EXAMPLE: Making a statement that your product is “made from recycled materials” when it only contains 20% recycled materials is misleading.

2. Have evidence to back up your claims

It’s good practice to have evidence to back up your environmental claims. Independent scientific evidence is best and if possible, make that research accessible to consumers. You should be able to prove that your business had reasonable grounds to make your claim.

EXAMPLE: Making a statement that your product “doesn’t contribute to deforestation” when in actual fact you don’t know where your supplier sources your product from. Here, you should have evidence to support this claim before making it.

3. Don’t hide or omit important information

Consumers can’t make an informed decision if you don’t provide them with the relevant information or provide them with the full picture. Don’t put important information in hard to read places where they’ll go unnoticed.

EXAMPLE: Making a statement that the bottle you sell is “plastic free” but on the back in small text you have a qualifying statement that says the claim doesn’t apply to lids. This is misleading.

4. Explain any conditions or qualifications on your claims

Theoretical benefits which are not clearly explained can mislead consumers. If there are any extra conditions that need to be met before your statement is true, or your statement is only true in certain circumstances than it’s likely misleading.

EXAMPLE: Making a statement that your product is “recyclable” when your product is not widely accepted for recycling and can only be recycled in a small number of locations.

5. Avoid broad and unqualified claims

Broad claims can be interpreted in many different ways and can easily mislead consumers. Ensure you qualify claims with disclaimers and be specific.

EXAMPLE: Making a claim that your product is “sustainable” or “uses less water”. This is vague and unclear and can mislead consumers.

6. Use clear and easy-to-understand language

Most consumers don’t have specialist scientific knowledge. It’s good practice to use easy-to-understand language and avoid technical terms.

EXAMPLE: Making a statement that your product is “reusable” when your product can only be reused a handful of times before becoming unsafe. While technically the product can be used more than once, consumers will interpret this as multiple re-use for an extended period.

7. Visual elements should not give the wrong impression

Visual elements – e.g. green-colouring, recycling logos, earthy or plant-based images – can influence a consumer’s impression of a product. Avoid using visual elements that would give consumers the wrong impression about the environmental benefits of your product.

EXAMPLE: Your product packaging has a green tick next to the words “biodegradable”. This gives the impression that your product will biodegrade when in fact you have not tested whether this is true. This is misleading.

8. Be direct and open about your sustainability transition

Avoid making aspirational claims about your business’s future environmental goals. While it’s natural to want to tell consumers that your brand is going green, wait until your goals have been fully realised first.

EXAMPLE: Your business makes a statement that it will be halving its greenhouse gas emissions, when in reality nothing has been formalised or committed to yet.

Where to from here?

Navigating the complexities of environmental claims in marketing can be fraught with legal risks, as highlighted by the recent actions of the ACCC. If you need guidance to ensure your marketing strategies are legally compliant, Seneworth Legal Partners can help you to build a brand that is both trusted and transparent.