FTC Green Guides: U.S. guidance for businesses making environmental claims

Background

Growing consumer demand for environmentally preferable products has led many businesses to promote products using terms such as "recyclable," "carbon neutral," "biodegradable," and "made with recycled content." However, broad or poorly substantiated environmental claims can mislead consumers and distort competition. To address this, the FTC first issued the Green Guides in 1992, revising them in 1996, 1998, and 2012 to reflect changes in environmental marketing and consumer understanding. The 2012 revision introduced new guidance on claims relating to carbon offsets, renewable energy, renewable materials, and environmental certifications and seals. The Green Guides do not establish new legal obligations. Instead, they explain how the FTC interprets deceptive environmental marketing under Section 5 of the FTC Act, helping businesses make claims that consumers are unlikely to misunderstand.

Key Provisions

The Green Guides establish overarching principles for environmental marketing and provide detailed guidance on numerous types of claims. Among other things, they advise businesses to:

• Ensure all environmental claims are truthful, substantiated, and supported by competent and reliable evidence before they are made.

• Avoid broad, unqualified claims such as "environmentally friendly" or "eco-friendly" if they imply environmental benefits that cannot be substantiated.

• Clearly qualify claims where necessary so consumers understand their scope and limitations.

• Avoid overstating the significance of environmental benefits.

The Guides also provide detailed recommendations for a wide range of specific environmental marketing claims, explaining how consumers are likely to interpret them, what evidence businesses should possess before making them, and when claims should be qualified to avoid misleading consumers. These recommendations cover areas including recyclability, biodegradability, compostability, recycled content, carbon offsets, renewable energy and materials, environmental certifications and seals of approval, and other common green marketing claims.

Enforcement

Although the Green Guides themselves are guidance rather than binding regulations, the FTC uses them when enforcing Section 5 of the FTC Act against deceptive environmental marketing. Businesses that make misleading environmental claims may be subject to FTC investigations, consent orders, injunctions, corrective actions, and, where applicable, civil penalties for violating FTC orders or other legal requirements. The FTC has brought numerous enforcement actions involving unsupported environmental claims, including claims relating to biodegradability, bamboo textiles, ozone-safe products, and other environmental marketing practices.

Current Status

The Green Guides remain in effect and continue to serve as the FTC's primary guidance on environmental marketing claims. In 2022, the FTC began a comprehensive review of the Guides, seeking public comment on whether they should be updated to address developments such as climate-related claims, "net zero," "carbon neutral," "sustainable," "organic," and other emerging environmental marketing terminology.

Resources

• https://www.ftc.gov/legal-library/browse/rules/green-guides

• https://www.ftc.gov/business-guidance/resources/environmental-claims-summary-green-guides