Uncertainty on EU green claims rules holds brands back

A new WFA survey of major multinationals reveals that more than half are wary of being accused of greenwashing under the Empowering Consumers in the Green Transition Directive, which is meant to come into force in September this year.

Responses from 17 leading consumer goods brands representing an estimated $38bn in ad spend questioned in February revealed that just under half of respondents consider that the Directive has impacted negatively their willingness to communicate about their sustainability initiatives, which means that consumers will find it harder to make choices where they want to support brands that are good for the planet.

Concern is high even though many policy experts are very familiar with the rules and have already taken action to respond. Clarification documents provided by the European Commission late last year have not satisfied brands or cleared up all areas of confusion.

More than 80% of brands consider the lack of clarity on the requirements as the main challenge with compliance. An additional challenge is that products already in market could also be retrospectively accused of breaking the law, if they aren’t sold before it comes into force.

A big part of the issue is not just that only four members states – Denmark, Latvia, Lithuania and Slovakia – have officially passed the directive into national law ahead of the end of March deadline – but also that the sister directive on Green Claims, which was meant to provide clear definitions in key areas, has become stuck in the legislative process.

Despite these hurdles, however, brands are taking action to comply:

• Seventy per cent are implementing changes to their commercial communications and 50% have adjusted environmental claims and labels. In the latter case this includes costly, wide-ranging changes such as removing claims, logos and certifications from packs, websites and artworks.
• Nine in 10 brands now have a claims policy in place, up from six in 10 brands in previous research undertaken in 2024, eight out of 10 have a clear process in place, up from 50% in 2024, while 60% have developed a complaint handling mechanism.

Unfortunately for both consumers and the goals of the directive’s proposers, the uncertainty means that some brands are putting less focus on the sustainable nature of individual products. Science-backed claims with third-party certification are being pulled by some respondents, as vague rules make them impossible to defend, for example.

Urgent clarity is needed if the directive is to accomplish its goals and give consumers information they can rely on when making purchase decisions.