Overview of the guiding principles for green marketing regulations

Brinsley Dresden Lewis Silkin LLP 18 th September 2009

Topics to be discussed

• What are the sources of legal and regulatory control?

• What are the main requirements of those laws and regulations?

What are the sources of regulation?

• ISO 14021: International Standard on Environmental labels and declarations • International Chamber of Commerce – Advertising & Marketing Communication Practice • National laws • National Self-Regulatory Organisation Code requirements

ISO 14021

• The International Standard relating to self-declared environment claims in ads • Often referred to in other codes • Strong presumption that adherence to ISO 14021 will result in compliance with other applicable laws and regulations • But need to consider other applicable laws and codes too

Definitions from ISO 14021

• “Environmental Claim” = any statement, symbol or graphic that indicates an environmental aspect of a product, a component or packaging • Can be on product, packaging, in literature, advertising, PR, telemarketing, digital or electronic media

Best Practice Guidelines

• Considerable overlap between codes • What follows is attempt to consolidate principles into single set of best practice guidelines • Adherence to these principles should result in compliance

General Principles

• All advertising should be legal, decent, honest and truthful • No advertising should mislead, or be likely to mislead, by inaccuracy, ambiguity, exaggeration, omission or otherwise

General Principles

• Advertisers must hold documentary evidence to prove all claims, whether direct or implied, that are capable of objective substantiation • Advertising should not encourage or condone behaviour that is or may be damaging to the environment

Environmental claims should....

• be specific about the environmental aspect that is claimed; • be unambiguous and unlikely to result in misinterpretation; • be true in relation to the entire life cycle of the product; and • be reassessed & updated as necessary

Environmental claims should not...

• suggest environmental benefits that do not exist nor exaggerate the environmental aspects of a product • suggest that they are based on recent advances or modifications if they are based on pre-existing but previously undisclosed aspects of the product

Unacceptable Claims

• Vague or non-specific claims or claims which broadly imply that a product is environmentally beneficial or benign, e.g. ozone friendly • Many claims relating to sustainability (because everything has a impact on the environment to some degree)

Unacceptable Claims

• Claims based on the absence of a harmful chemical or damaging effect, if the product category does not generally include the chemical or cause the effect • Claims based on the absence of harmful constituents if the product contains other equally harmful elements

Unacceptable Claims

• Spurious ‘free from …’ claims (unless there is no more than a trace element of the specified substance), e.g. “CFC free” after these have commonly been removed • Claims that cannot be verified without access to confidential business information (because not verifiable)

Substantiation & verification

• Advertisers should implement evaluation measures to verify environmental claims before publication • Advertisers should fully document their evaluation and the documentation should be retained for the period that the product is on the market and for a reasonable period thereafter

Substantiation & verification

• Absolute and superiority claims (e.g. the most fuel efficient engine on the market) require a higher threshold of substantiation than relative claims • Should be used with considerable caution but may be acceptable if they can be substantiated

Substantiation and verification

The minimum information that should be retained includes: • Identification of the standard or method used (particularly if the claim involves a comparison with other products) • Documentary evidence

Substantiation and verification

• Test results (if applicable) and details of testing body • Evidence that the claims will remain accurate during the period that the product is on the market and for a reasonable period thereafter, taking into account the life of the product

Explanatory Statements

• If a claim is likely to result in misunderstanding, the claim should be accompanied by an explanatory statement • Generally speaking, only statements which are valid “in all foreseeable consequences with no qualifications” can be made without an explanatory statement

Explanatory Statements

• The explanatory statement shall be of reasonable size and in reasonable proximity to the relevant environmental claim

Language

• Avoid use of extravagant language • Avoid bogus scientific terms • Avoid confusing scientific terms • N.B. Some countries also have requirements about use of local national language in advertising

Use of specific claims

• ISO Code, ICC Code and have specific rules about several terms which commonly appear in environmental claims • These terms may only be used if certain criteria are fulfilled • And/or if they are suitably qualified

Use of specific claims

• Compostable • Degradable • Designed for disassembly • Extended life product • Recovered energy • Recyclable • Recycled content • Reduced energy consumption • Reduced resource consumption • Reduced resource use • Reduced water consumption • Reusable and refillable • Waste reduction

Any Questions?

Brinsley Dresden Lewis Silkin LLP +44 20 7074 8069 [email protected]