Marketers beware: FTC steps up scrutiny of green certifications

Speaking Sustainably

Marketers beware: FTC steps up scrutiny of green certifications

green product labels, sustainability certifications
Green labels are increasingly common, but regulators aren't taking them at face value.

At Shelton Group, we’ve long espoused the merits of third-party certifications — the ones that lend credence to green claims made on product labels and in advertising.

They provide some legitimacy, and our research shows that consumers view them favorably. In fact, they can tip the balance when it comes to product purchases for about a quarter of the population.

But certification holders (and seekers) beware: however hard sought and earned, even certifications can be considered greenwash if the seals or logos that represent them are not designed and used properly. And if they’re not, the FTC could come knocking at your door.

In case you haven’t heard, it knocked on the doors of five environmental certifiers and 32 businesses in September. Each received a letter (PDF) expressing concerns that the seals they issue (or display) could be considered deceptive, that they may not be in line with the FTC’s environmental marketing guidelines, the Green Guides.

The focus was on the absence of "clear and prominent qualifying language that clearly conveys that the certification or seal refers only to specific and limited benefits."

Without it, consumers could infer more environmental benefits than the product actually delivers. Certifiers were also admonished for not actively instructing marketers to use qualifying language with the logos.

The commission has not revealed which certifiers and businesses they targeted, and it did not take or threaten legal action against them. It characterized the letters as "warnings."

Still, we should take them as a wake-up call, because they tell us loud and clear that the FTC remains interested in green marketing — and the fact is future legal actions are possible.

Certified or uncertified, the rules are the same

It’s not news that the FTC frowns on unqualified, general environmental benefit claims — claims that, as it says, pose a risk of deception.

Specifically, it maintains that when they stand alone on labels or in advertising, terms such as "green," "eco-friendly" and "sustainable" are too broad, too vague to convey any real environmental benefits.

Shelton Group’s most recent research supports the FTC’s position. Although it shows consumers respond quite positively to these terms, without some context, without qualification, they can elicit unrealistic expectations — the kind that can attract FTC attention and disappoint or even anger consumers when those expectations aren’t met.

The warning letters make clear that the FTC’s ban on imprecision applies just as much to certifications as it does to other types of green claims — and it applies to all certifications. While there are multi-attribute eco-labels that certify more general environmental benefits, look at them closely.

Even these must call out the basis for their "reduced environmental impact" claims with language either within or in close proximity to the mark.

Certifications done right

We’ll say it again: certifications are a good thing. But for better or worse, the roster of sustainability-related certifications has become mind-bogglingly long, and it keeps getting longer.

Although that means there’s likely a certification that fits your products and market, it stands to reason that some are more meaningful to more people than others, some influence product purchases more than others. And some meet FTC guidelines better than others.

It takes some diligence to seek the right ones for your products and more diligence to use them properly.

Some, such as Energy Star, have plug-and-play logos, but others definitely need the qualifying language that the FTC’s letters warn about. A certifier might include that language as part of the logo you’ll use, but if not, they should — note I said should — give you clear direction on the qualifying language you’ll need to use.

Among the certifying organizations that appear to be doing their job right is UL. It takes a very conservative stance on qualifying language and worked closely with the FTC on it. With Shelton Group’s help, it also took a deep dive into consumers’ perceptions of various green certifications.

Among many other interesting results, this study found that certified claims featuring qualifying language performed better on average than those without it. In case you needed one, that’s another strong reason to take a second look at how you’re presenting your certifications.

Will the FTC be sending out more letters? Will it take stronger actions? It remains to be seen.

What we do know is you don’t want a letter showing up in your mailbox. So take some time — now — to do a compliance check. Review the seals and certifications you use, how you present them and the language you’re using with them.

Here are links to some free resources you may find useful:

From the FTC: Guides for the Use of Environmental Marketing Claims (“The Green Guides”)

From UL: Claiming Green

From Shelton Group: The Buzz on Buzzwords

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