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The Coming Crackdown on Greenwashing

Companies have been making misleading claims about the eco-friendliness of their products for almost as long as people have cared about the environment. Back in 2007, the marketing firm TerraChoice went into an unnamed big-box retailer and evaluated the green-advertising claims of more than 1,000 products. Only one actually lived up to its promises. But now, according to Greenwire, the Federal Trade Commission may finally start cracking down hard on this sort of "greenwashing":

David Vladeck, director of FTC's Bureau of Consumer Protection, told the Senate Subcommittee on Consumer Protection last summer that tougher enforcement and environmental guidelines are a major part of the commission's agenda.

"In response to the explosion of green marketing in recent years, the agency initiated a review of its Green Guides to ensure that they are responsive to today's marketplace," Vladeck said in his written testimony. The commission is looking into topics beyond the scope of the existing guides, he noted, "because many currently used green claims, such as 'sustainable' and 'carbon neutral,' were not common when the Commission last revised the Guides."

The FTC already goes after a few strains of greenwashing—last year, for instance, Kmart got dinged for advertising a line of paper plates as "biodegradable" when they didn't actually decompose. But there are so many different ways to greenwash that the FTC can't go after everything. For instance, a product could claim to use "50 percent more recycled content" in its packaging when that really means a (negligible) increase from 2 percent to 3 percent. Or a product could claim to be "100 percent natural" when some of those "natural" ingredients include hazardous substances like arsenic. TerraChoice has posted a taxonomy of the major greenwashing tactics.

Meanwhile, as Vladeck mentions, there's a whole new set of issues cropping up in response to climate concerns. One big question is whether the FTC will start looking more closely at carbon offsets. It's not always easy for consumers to tell whether a given offset project will actually lead to a real reduction in greenhouse gases. What if the offsets are going toward projects (like reforestation) that would have happened anyway? So the FTC could apply more scrutiny in this field, although industry groups are opposed to the idea—especially since the commission isn't necessarily the ideal agency to set offset regulations. But as long as Congress dithers in passing a climate bill, different agencies are likely to take up different aspects of emissions issues in this sort of ad hoc manner.