Anti-Greenwashing Directive: What the EU’s Greenwashing Ban Means for Small Businesses

In its latest effort to tackle greenwashing, the European Parliament passed a directive to ban greenwashing and misleading product information. While the directive is aimed at protecting consumers from misleading practices and helping them make better purchasing decisions, it is also making small business owners and marketers in the sustainability space nervous. With the directive restricting the use of generic environmental claims, uncertified sustainability labels and imposing stricter rules on offsetting schemes, the question arises: what can we still say about our impact?

What exactly is the EU’s new ban on greenwashing and misleading product information?

The so-called Directive on Empowering Consumers for the Green Transition will expand the EU's list of banned commercial practices to include various claims related to greenwashing and the early obsolescence of goods. Its objective is to help consumers make more informed purchasing decisions.

Firstly, this comes with a list of new bans:

1. Banned to prevent greenwashing:

General environmental claims like “environmentally friendly”, “natural”, “biodegradable”, “climate neutral” and “eco” without proof of recognised excellent environmental performance relevant to the claim.
Sustainability labels not based on approved certification schemes or established by public authorities.
Claims on products having a neutral, reduced or positive impact on the environment that are purely based on offsetting schemes.

2. Banned to prevent planned obsolescence of goods:

Commercial communications about a good with a feature that limits its durability if information is available on the feature and its effects on the durability.
Unproven durability claims in terms of usage or intensity under normal conditions.
Earlier than strictly necessary prompts to replace consumables (e.g. printer ink cartridges).
Presenting software updates as necessary when they only enhance functionality features.
Presenting goods as repairable when they are not.

Secondly, a new, harmonised label will be created to put a spotlight on goods with extended guarantee periods.

When will the EU’s greenwashing ban take effect?

On the 17th of January 2024, the European Parliament voted overwhelmingly in favor (593 out of 628) of adopting the directive. The directive now awaits final approval from the European Council. After that, member states will have two years to integrate the new rules into their national legislation.

Why is the European Union implementing an anti-greenwashing directive?

As the parliament’s rapporteur Biljana Borzan put it: “This law will change the everyday lives of all Europeans! We will step away from throwaway culture, make marketing more transparent and fight premature obsolescence of goods. People will be able to choose products that are more durable, repairable and sustainable thanks to reliable labels and advertisements. Most importantly, companies can no longer trick people by saying that plastic bottles are good because the company planted trees somewhere – or say that something is sustainable without explaining how. This is a big win for all of us!”.

What impact will the EU’s new greenwashing ban have on small, sustainable businesses and marketers?

The anti-greenwashing directive will be complemented with the more specific green claims directive, which is planned to be voted on in February 2024. The green claims directive will apply to every business selling on the European market, except for:

Those with less than 10 employees and less than 2 million euros in turnover.
Sustainability information in financial services.

The exact requirements, such as what exactly would count as sufficient proof of a claim and who are accepted as third-party verifiers, will become clear over the coming months. Sign up for our newsletter to stay up to date!

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Sustainability