Companies claiming to be eco-friendly, green, organic or sustainable will henceforth have to disclose the basis of such claims, failing which they will be penalised for “misleading advertising” and unfair trade practices under the consumer protection act (CPA), according to the new guidelines on greenwashing and misleading environmental claims released on Tuesday.
“Any deceptive or misleading practice, which includes concealing, omitting, or hiding relevant information, by exaggerating, making vague, false, or unsubstantiated environmental claims, will fall under the purview of greenwashing,” Nidhi Khare, secretary, ministry of consumer affairs said after releasing the guidelines.
The key goal of these guidelines is to shield consumers from misleading information while promoting genuine environmental responsibility within the business community.
The guideline will be applicable to manufacturers, service providers, traders, advertising agencies and endorsers of the products. Khare, however, said the guidelines do not seek to prohibit companies from making environmental claims, rather, the aim is to ensure that such claims are made with integrity and transparency.
“Manufacturers and service providers are required to substantiate their environmental claims with credible evidence and this includes providing detailed information on the methodology and data used to support such claims,” according to the guidelines. It moots third-party certifications for such claims.
It stated that the use of vague or misleading terms such as – eco-friendly, green, and sustainable without proper substantiation is sought to be prohibited.
“These guidelines seek to foster truthful practices where environmental claims are both truthful and meaningful, thus enhancing consumer trust and encouraging sustainable business practices,” she said.
According to an official statement ‘the guidelines are drafted in the wake of the rapid increase of advertisement of green (environmentally friendly) products and the growing number of environmentally aware consumers,”.
The guidelines also emphasise the importance of using consumer-friendly language, particularly when introducing technical terms such as environmental impact assessment, greenhouse gas emissions, and ecological footprint.
Advertisers are encouraged to explain these concepts in simple terms to help consumers understand their meaning and implications, it stated. It also specifies that advertisers avoid cherry-picking data from research studies to highlight favourable observations while obscuring less favourable findings.
“When making environmental claims, it is essential to clarify whether the claim refers to the product as a whole, a specific component, the manufacturing process, packaging, the manner of use, or its disposal,” Khare said.
Under Section 24 of the CPA, the Central Consumer Protection Authority can impose penalties for misleading corporate claims, with fines of up to Rs 50,000, which may escalate to Rs 1 crore for repeated violations.
Section 21 of the Act, which establishes penalties for misleading advertisements, first-time offenders may face fines of up to Rs 10 lakh, while repeat offenders can be fined up to Rs 50 lakh with possible imprisonment of up to two years.
From: financialexpress
Financial News
