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Greenwashing Goes Through the Wringer

Companies have had an open field when it comes to making assertions about how environmentally friendly their products are. Now the feds want a little more honesty in those claims.

The Federal Trade Commission this month proposed changes to the green advertising guidelines it provides companies — as the FTC's press release thoughtfully puts it — "to help them avoid making misleading environmental claims."

The gesture sounds like an altruistic one. This eco-landscape is getting so confusing, what with all the recyclables, renewables, biodegradables and compostables. Why, here's a little advice to help marketers sort that out!

But gleeful environmentalists have praised the announcement more accurately for what it really is: The government is about to make it harder for companies to "greenwash."

That slur is about as ubiquitous today as "green" labels on a grocery shelf. It speaks to companies that have grown adept at papering over old products and services with new and ambiguous claims of "environmental friendliness." The toolbox has long been full of evocative adjectives that don't actually mean much (and thus can't be contested easily).

Now the FTC wants to get specific about a number of claims that have never been addressed by the "Green Guides," which were first written in 1992 and last updated 12 years ago. While they're at it parsing language, companies also shouldn't be fooled by words like "guidance" and "advice."

"The primary goal here is to give companies guidance that they need and that they're looking for," said Mitchell Katz, a public affairs officer with the FTC. "But if they totally disregard that guidance, yes, we will bring enforcement actions against them. The chairman [Jon Leibowitz] has said it best: "There are companies that step over the line and then try to comply by reading the guides, and then step back. And then there are companies that live over the line."

THE IDEA LOBBYMiller-McCune's Washington correspondent Emily Badger follows the ideas informing, explaining and influencing government, from the local think tank circuit to academic research that shapes D.C. policy from afar.

Miller-McCune's Washington correspondent Emily Badger follows the ideas informing, explaining and influencing government, from the local think tank circuit to academic research that shapes D.C. policy from afar.

Those chronic abusers face enforcement under the FTC Act, which gives the commission the power to investigate and seek penalties for marketing claims that mislead or deceive consumers.

For starters, the FTC now wants companies to ditch the sweeping claims of "green" and "eco-friendly" ("they are difficult, if not possible, to substantiate"). Such claims have been allowed by the existing guidelines, if the explicit or implied claims that come with them can be supported. If a product is "degradable," it must now break down within one year of being trashed. And if it is "recyclable," the package must come with qualifications based on the actual availability of recycling (for example, "this package may not be recyclable in your area").

The new guidelines would make big changes to the claim that any product is "free of" something. Even if, for example, a product is "free of CFCs," that claim would be considered deceptive if the product contains other substances that deplete the ozone just as well (like HCFC-22s). Companies also won't get to claim that a product is "free of CFCs" if CFCs (previously found in many aerosol cans) have never actually had anything to do with the product (such as cookies).

The changes would also for the first time define guidelines for using the terms "renewable materials," "renewable energy" and "carbon offsets" — all of which turn out to be particularly baffling to the public. The FTC is primarily concerned not with scientifically accurate definitions for these phrases, but with what most people think they mean. Because of this, the FTC commissioned a consumer perception study before writing the new guidelines.

The research reveals how vaguely the public grasps many of these concepts — and how easy it would be for a company to exploit that. If a kitchen-flooring product is made with "renewable energy," study participants were asked, what did they think that meant? Did it mean the product had no negative environmental impact, or less negative impact than similar products? Was the renewable energy used in each step of the product's life cycle — production, transportation, consumption, disposal — or only some of those steps?

If a product says "our manufacturing plant hosts a wind power facility," does that imply that this particular product was made using wind power? Some 62 percent of people thought so. Nineteen percent of people thought a "carbon neutral" product was one that contained no carbon in it.

If the new guidelines are adopted — public comment runs through early December — products will have to specify exactly what's so renewable about their materials (what they're made of, how they were sourced, etc.). Companies won't be able to make claims about "renewable energy" if fossil fuels powered the manufacture of any part of the product. And packaging will have to state exactly which renewable energy source we're talking about: Wind? Solar? Hydroelectric?

Companies will also have to disclose if the emissions reductions funded by a "carbon offset" won't actually occur within two years. And finally, in a glimpse of how eco-advertising will have to evolve as environmental regulations do, marketers won't get to advertise "carbon offsets" already required by law.

It's a lot to keep track of, but the hope is that boastful eco-packaging will soon be easier to understand and more meaningful.