The European Council announced last month that it had reached an agreement to protect consumers from greenwashing, requiring companies to verify claims and labels regarding the environmental impact of their solutions.
Greenwashing, also called green sheen, is a form of advertising that deceptively looks to persuade the public that an organization’s products, goals, or policies are environmentally friendly.
The EU Commission first launched its directive in March of last year, looking to address the need for reliable information for consumers, in particular with a recent study finding that more than half of green claims by companies in the EU were vague or misleading.
According to the report, 40% of green claims in the EU were in fact completely unsubstantiated.
The EU Commission’s proposal included minimum requirements for businesses to substantiate their green claims, requiring companies to ensure the reliability of claims with scientific evidence. The directive also targeted the growth of private environmental labels, mandating that they be reliable, transparent, and regularly reviewed.
The directive is a part of a series of circular economy-focused proposals by the EU Commission, which also includes the ecodesign regulation, updates to the EU’s unfair commercial practices directive and a consumer rights directive.
One of the key changes to the directive proposed by EU Council’s position relates to the use of offsetting through carbon credits in making climate-related claims, such as “carbon neutral” or “net zero.”
Said Alain Maron, Minister of the Government of the Brussels-Capital Region, “Today, we reached an important agreement to fight greenwashing by setting rules on clear, sufficient and evidence-based information on the environmental characteristics of products and services. Our aim is to help European citizens to make well-founded green choices.”
Governments, enterprises and individuals are increasingly looking to new legislation, in addition to new technology ventures, to guarantee ESG compliance.
Credibl, one of these ESG ventures, is an emerging player with a platform that helps private companies, organizations and investors manage their green efforts with results.
For investors requiring a comprehensive understanding of various factors in order to effectively monitor ESG performance across portfolios, the companies AI-driven solution helps, providing a detailed insight into the ESG performance of each company, whether they are public or private.
For enterprises looking for a transition to green, the platform offers a one-stop solution to measure, manage, and report on ESG data, empower sustainable business decisions, and track performance.
Advanced reporting software solutions like this and more stringent investment regulations combined are set to help the world of green become transparent and better aid progress towards net zero carbon goals.
