While Canadian companies are marketing green products and services to the point of ubiquity, Canada’s Competition Bureau, along with the Canadian Standards Association, is cracking down on so-called “green washing,” with a set guidelines that prohibit vague or misleading environmental claims on products and services.
We’re entering a new green era for products, services, advertising, and the product packing itself, where just saying you’re green or eco-friendly will no longer be good enough, say IP experts.
Indeed, as consumers become inundated with messages of sustainability and environmental friendliness, complaints about these claims also rise. In the U.K., the Advertising Standards Authority, a group that monitors advertising content, says it received almost 600 complaints about green claims last year, up from about 100 in 2006. A similar group in the EU, the European Advertising Standards Alliance, also reports sizable increases in complaints, including from Belgium and the Netherlands, and particularly involving automotive advertising.
“Fuel-economy claims are hugely important, and if you look at car ads now you’ll see that they’re much more prominent than they were six months ago; those are very effectively regulated by Transport Canada. No problem, that’s measurable,” says Vogt. “But what is much more difficult to measure is whether it is or is not environmentally friendly. What the guidelines, I think, are attempting to do is require manufactures, advertisers to highlight exactly what the benefit is and not make vague claims, because, ultimately, if you look at a product or service on a cradle-to-grave analysis, the benefit that it contributes may actually be nullified by other aspects of its production, shipping, etc. Consumers are beginning to understand that and need to be told the facts, or at the very least for claims to be limited.”
Jennifer McKenzie, with IP firm Bereskin & Parr in Toronto, covers advertisign law in her practice. She says she’s been watching the national advertising division (NAD) of the Better Business Bureau, which reviews ads for truthfulness and accuracy, “certainly because the U.S. tends to be more litigious,” she says. “I understand they have seen more trade complaints, and I just participated in a conference call with a U.S. firm where they gave samples of cases that had gone before the NAD. And it was really interesting because the NAD, much like these new guidelines, wants manufactures to look at the cradle-to-grave life of the product, and if it’s got a benefit in one area is it truly a net benefit?”
McKenzie points to a case in the U.S. involving Panasonic Corp. of North America and its large-screen plasma TVs, particularly its claim that “Panasonic plasmas are environmentally friendly. No lead. No mercury. No worries. Most LCD TVs have mercury.” The NAD determined Panasonic was free to tout the fact that its plasmas are lead and mercury free and free to note that most LCDs contain mercury. However, it recommended Panasonic stop claiming its plasma TVs are “environmentally friendly.”
Under the new Canadian guidelines, claiming a product or service is “environmentally friendly” is not allowed unless the life cycle of the product or service is thoroughly examined and verified. For example, labelling a consumer product as ‘environmentally friendly’ or ‘environmentally safe’ implies that a product is environmentally benign or beneficial. Without greater specificity with respect to the reduced environmental impact, the environmental feature, or the benefit that the claim refers to, such far-reaching claims could be misleading or deceptive, as every product made is consumable and has an impact on the environment, say the guidelines.
James E. Longwell, a lawyer and patent and trademark agent with Gowlings, says this kind of claim is prevalent with advertising for some hybrid automobiles. “On the short window of their lifespan, their use may be more friendly to the environment than normal gas-powered vehicles, but if you look at the production issues, making batteries, disposal issues for all of those parts, the life cycle of the batteries, it’s extremely difficult for the consumer to make an informed decision when at the point of purchase they’re being told it’s a green product,” he says. “You don’t get the full environmental picture.”
McKenzie says greenwashing was always something “lurking in the background, but to finally get the Competition Bureau on record as saying, ‘This is what we’ll apply in determining whether a claim is potentially misleading,’ I think that’s very helpful,” she says, although she notes some of the comments in the guidelines are a little unwieldy. For example, the section on disposal claims such as “recyclable” and “refillable” require facilities to be available in the area where the product is sold. Collaboration between the manufacturer and distributor to ensure such services exist will help limit inappropriate claims. “They’re asking manufacturers to comment on facilities that can accommodate or have a program to recycle that kind of material,” says McKenzie. “I think that’s going to be very difficult — just in terms of the manufacturer keeping abreast of it — and also a space constraint.”
Another potential issue with the guidelines is enforcement, says Vogt. “The weak link here is that, although the Competition Bureau says that it’s going to make this a priority, they also say, which is totally contradictory, that they’re only going to act on complaints,” she says. “So unless Greenpeace or a similar organization makes a point of monitoring the marketplace, I’m not sure how much will change. What I think will change is that I think there are really legitimate green companies in the market who care about what they’re doing, who have thought about all of this, who are making claims that are correct and accurate, and they think the guidelines will give them some leverage in complaining to the bureau about competitors,” says Vogt.
McKenzie adds: “I’ve spoken with the Competition Bureau about the number of complaints they get . . . and at least one official has said they do take competitor complaints quite seriously because they tend to be more in the know about why something might be misleading.”
And while some companies may just stick to making green claims on their packaging, other companies are patenting truly green packaging. Longwell points to one example of a Canadian patent application by Labatt Brewing Company Ltd., which relates to a “packaging recycle system.” The abstract on the Canadian Intellectual Property Office web site claims the invention is “a carton which can be constructed from a single blank and is particularly useful for carrying returnable bottles such as beer bottles, when full, to the consumer and when empty, back to a recycle centre.
“The improvement comprises providing the container with a means to accept and retain the crowns removed from the bottles together so that all the components of the retail package; the bottles; carton and the crowns can be returned as a convenient unit for ease of recycling.”
As well, the Eco-Patent Commons, established by IBM and others, is also a way for companies to share “green” patents for:
• energy conservation or improved energy or fuel efficiency;
• pollution prevention (source reduction, waste reduction);
• use of environmentally preferable materials or substances;
• water- or materials-use reduction; and
• increased recycling opportunity.
“Initiatives like these can contribute to brand image even if ultimately they are not successful,” says Longwell. “Sometimes you get marks for trying.”
Longwell also notes that consumers routinely see logos and symbols that, “at least in their minds, appear to be a certification for green product character or quality or similar practices. The recycling symbol comprising the three arrows is one such symbol. The symbols are convenient substitutes for consumer inquiry and diligence.
However, it is not always clear what the symbols certify and who audits the auditors,” he says.
“For the consumer and for the business, these issues crystallize in the finished product, its packaging and associated materials such as advertising that is put into the market. Advertising laws and associated regulatory rules and guidelines, such as the new guidelines, are in place to provide guidance to business for acceptable practices and to curb certain unacceptable practices so as to level the playing field. They also can give a route for complaints and investigation and give protection to consumers. This is a delicate balancing act,” he says.
“At the end of the day, as a consumer, while some comfort can be had knowing there are guidelines like these and other laws about deceptive practices, consumers cannot delegate every responsibility to the state,” says Longwell. “Caveat emptor suggests we should do a little research to see what’s behind the green claims.”