After years of pondering, FTC releases marketers' Green Guides
<p>After nearly five years of deliberations, the Federal Trade Commission has finally issued <a href="http://www.ftc.gov/os/2012/10/greenguides.pdf">revised “Green Guides.”</a></p>
It’s been a long time coming, but after nearly five years of deliberations, the Federal Trade Commission today issued revised “Green Guides” aimed at helping marketers ensure that the claims they make about the environmental attributes of their products are truthful and non-deceptive.
The document released today is an update to guidelines first introduced in 1992 and updated in 1996 and 1998. The draft of this update was released almost two years ago to the day. Now, 14 years later, the FTC has refreshed them for the 21st century, including updates to the existing guides as well as new sections on the use of carbon offsets, environmental certifications and seals, and renewable energy and renewable materials claims.
“The FTC’s changes to the Green Guides will level the playing field for honest business people and it is one reason why we had such broad support,” says FTC Chairman Jon Leibowitz.
It’s a low bar, but at least it’s done.
In revising the Green Guides, the FTC modified and clarified sections of the previous Guides and provided new guidance on environmental claims that were not common when the Guides were last reviewed.
I asked Leibowitz whether two years is typical for the FTC to take its proposed guidelines to final form. "two years between a draft and finalizing is a little bit on the long side, but we wanted to make sure we got it right," he said. "This is a very complicated area with lots of different claims, lots of different context. It was a somewhat longer process than usual. At the end of the day, most of the stakeholders involved — marketers and environmentalists — will be very happy with the final product."
Among other modifications, the guides caution marketers not to make broad, unqualified claims that a product is “environmentally friendly” or “eco-friendly” — or "green" — because the FTC’s consumer perception study confirms that such claims are likely to suggest that the product has specific and far-reaching environmental benefits. The commission notes, “Very few products, if any, have all the attributes consumers seem to perceive from such claims, making these claims nearly impossible to substantiate.”
The guides also:
- advise marketers not to make an unqualified degradable claim for a solid waste product unless they can prove that the entire product or package will completely break down and return to nature within one year after customary disposal;
- caution that items destined for landfills, incinerators, or recycling facilities will not degrade within a year, so marketers should not make unqualified degradable claims for these items; and
- clarify guidance on compostable, ozone, recyclable, recycled content, and source reduction claims.
The guides — which take effect immediately — contain new sections on: certifications and seals of approval; carbon offsets, “free-of” claims, non-toxic claims, made with renewable energy claims, and made with renewable materials claims.
The new section on certifications and seals of approval, for example, emphasizes that certifications and seals may be considered endorsements that are covered by the FTC’s Endorsement Guides, and includes examples that illustrate how marketers could disclose a “material connection” that might affect the weight or credibility of an endorsement. In addition, the guides caution marketers not to use environmental certifications or seals that don’t clearly convey the basis for the certification, because such seals or certifications are likely to convey general environmental benefits.
Finally, either because the FTC lacks a sufficient basis to provide meaningful guidance or wants to avoid proposing guidance that duplicates or contradicts rules or guidance of other agencies, the Green Guides do not address use of the terms “sustainable,” “natural,” and “organic.” Or "green." (Organic claims made for textiles and other products derived from agricultural products are covered by the U.S. Department of Agriculture’s National Organic Program.)
The Guides issued today take into account nearly 340 unique comments and more than 5,000 total comments received since the FTC released the proposed revised guides two years ago. They also include information gathered from three public workshops and a study of how consumers perceive and understand environmental claims.
The Green Guides are not agency rules or regulations. Instead, they describe the types of environmental claims the FTC may or may not find deceptive under Section 5 of the FTC Act. Under Section 5, the agency can take enforcement action against deceptive claims, which ultimately can lead to Commission orders prohibiting deceptive advertising and marketing and fines if those orders are later violated.
The FTC today also released several business and consumer education resources designed to help users understand the Guides. These include: “Environmental Claims – Summary of Green Guides,” a four-page summary of the changes in the Guides; “The Green Guides,” a video explaining highlights of the changes; a new page on the FTC Business Center, with links to legal documents, the Guides and other “green” content; a Business Center blog post; and related consumer information.
And if that's not enough, there's a 300-page Statement of Basis and Purpose explaining what this is all about.