Preparing for the EU Green Claims Directive – How Companies Can Eliminate Greenwashing at Its Source

Many companies have attempted to improve their environmental behavior, not least in order to meet customer and stakeholder expectations. However, the absence of clear and established rules on how to verify green claims in an officially approved way has complicated this undertaking, creating an ambiguity that has left companies potentially vulnerable to accusations of greenwashing. As a result, regulators are now acting to impose clarity, in this way facilitating companies’ endeavors and helping to strengthen consumer trust in green claims.

On March 22, 2023, the European Commission published a proposal for a directive that aims to create a harmonized set of rules on the substantiation and communication of green claims. It offers much-needed clarity and guidance for companies on what they can say about their general record on sustainability or about the environmental benefits of specific products. This proposal represents the very latest in a plethora of recent regulatory developments related to the broader issue of sustainability – such as the EU taxonomy for sustainability activities, the Corporate Sustainability Reporting Directive (CSRD), the European Sustainability Reporting Standards (ESRS), the Corporate Sustainability Due Diligence Directive (CS3D), and the Ecodesign for Sustainable Products Regulation.