CMA INVESTIGATES SUSTAINABILITY CLAIMS
Stephen Sidkin, a partner at London law firm, Fox Williams, has a warning for fashion brands. The Competition and Markets Authority (CMA) is currently investigating the sustainability claims made by fashion businesses in the UK. Earlier this month, the CMA published its advice to the government following a public consultation. The consultation followed the publication in Autumn 2021 of the CMA’s Green Claims Code for businesses.
GREEN CLAIMS CODE
In 2021, the CMA conducted a global review of websites to develop an understanding of the impact of green marketing on consumers. It found that 40% of green claims made online were potentially misleading. The CMA then implemented the Green Claims Code to ensure that environmental claims made by businesses comply with the updated consumer protection law. The 6 pillars of this code are:
- Claims must be truthful and accurate.
- Claims must be clear and unambiguous.
- Claims must not omit or hide important relevant information.
- Comparisons must be fair and meaningful.
- Claims must consider the full life cycle of the product or service.
- Claims must be substantiated.
WHAT ARE THE CMA’S RECOMMENDATIONS?
Sara Cullen, the General Counsel at CMA has said:
“…we plan to shine a light on what [fashion] businesses can and can’t do under current competition and consumer laws, as well as advising the government on changes that will help people shop more sustainably.”
Put simply, the CMA wants to make it easier for consumers to make choices based on sustainability. It recognises that terms such as ‘recycled’ and ‘carbon neutral’ can be misleading. Consumers would be more well-informed if this jargon was defined in law, thereby supporting the Green Claims Code.
WHAT IS GREENWASHING?
The fashion industry contributes to 10% of global pollution and up to 92 million tonnes of waste and 79 trillion litres of water is consumed every year to make garments. With the growing climate crisis and focus on global warming, fast fashion and the effects of mass usage of water and energy has become an area of focus for the CMA. According to the charity Remake, only 20% of discarded textiles are reused or recycled, the other 80% end up in landfills. This shocking statistic is one of the reasons that the CMA has chosen to investigate the concept of greenwashing in the fashion industry. Greenwashing is when a brand makes incorrect claims about its sustainability practices that mislead its customers into thinking what they are buying is good for the planet when it is in fact not.
WHAT WILL HAPPEN TO THE GREENWASHERS?
Many high-street brands have been called out for greenwashing, with the list of offenders including Zara and H&M, the latter having marketed a line of clothing as ‘Conscious’ but did not give sufficient information about its sustainability. The CMA has begun an investigation into sustainability claims made by fashion brands in the UK and aims to improve laws and public understanding and awareness of the growing crisis in the fashion industry. It is expected that the CMA will out the brands most guilty of claiming sustainability, damaging their reputations and holding them accountable in front of their consumers. It is hoped that this will encourage changes in the ways in which brands embrace sustainability, for example, making changes to their supply chains to ensure that environmental claims are accurate.
TIME TO WALK THE WALK
In a recent interview, Burberry’s CFO/COO Julia Brown noted the importance of circularity in the brand’s goal to be climate positive by 2040. She emphasised the importance of working together to ensure that all facets of production, from farming to the suppliers, are sustainable but not a top priority for Burberry as 2040 is 18 years away. Only in 2018 did Burberry stop destroying hundreds of millions of pounds worth of unsold product for years but only when it received bad press in 2018.. The onus of being sustainable therefore lies on the fashion industry as a whole. This has already begun on an individual level as customers are creating a demand for sustainably-conscious fashion lines with over three-quarters of shoppers believing that sustainable shopping is important in everyday life. However, there is a push for big brands and corporations to develop the same awareness, rather than simply greenwashing and claiming to be green. A case in point is Shein, the Chinese fashion brand that is now larger than both Zara and H&M in the United States but whose manufacturing in China is questionable, to say the least. This clearly shows that many customers do not care. Fashion brands are very good at talking the talk. It’s about time that they walked the walk. CMA knows that actions speak louder than words. Let’s hope that one day the fashion world will have the same vision.
