There is a Senate Inquiry Into Greenwashing; Here’s What It Means

A lot of attention has been paid to the Australian Competition and Consumer Commission’s (ACCC) crackdown on greenwashing following the release of its report revealing 57 per cent of 247 Australian businesses reviewed raised concerns of greenwashing.

The report highlights sectors with the greatest proportion of dubious environmental claims as cosmetic and personal care, textiles, garments and shoes; and food and beverage.

Receiving less attention, but initiated as a result of the ACCC report, a Senate Inquiry into greenwashing was announced on the 29th March 2023. The inquiry, run by the Senate Standing Committee On Environment and Communications, is due to report back to Parliament by 5th December, 2023.

Many companies will be acutely aware of the reputational damage that can be done by the Senate Inquiry spotlight.

The inquiry will focus on the environmental and sustainability claims made by companies in industries including energy, vehicles, household products and appliances, food and drink packaging, cosmetics, clothing and footwear.

These sustainability claims may be made in a variety of ways but can be categorised as follows:

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Product specific claims:

These may appear on packaging, websites, advertisements or social media posts by influencers.

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Company-wide claims:

These will generally appear on websites or in corporate social responsibility statements and reporting documents

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Claims using logos and symbols (including certification trademarks):

These can appear on product packaging, websites, or advertisements.

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How can I tell if my company is at risk?

First, it’s worth noting the terms of reference for the inquiry, and consider each in relation to your business.

1. The impact of misleading environmental and sustainability claims on consumers;
2. Domestic and international examples of regulating companies' environmental and sustainability claims;
3. Advertising standards in relation to environmental and sustainability claims;
4. Legislative options to protect consumers from green washing in Australia

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Once you have taken these factors into consideration, ask yourself, whether your company has made any environmental or climate related claims, and whether you have the data or evidence to substantiate those claims.

If you are unclear on whether you can substantiate any claims, made either on packaging, digitally or any form of communications as mentioned above, then there is risk.

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Is there a positive side to the inquiry?

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Yes! If your company is on an authentic sustainability journey the Senate Inquiry into Greenwashing creates a platform for you to help shape the narrative. Both organisations and individuals are invited to make written submissions by 8th June, 2023.

The inquiry recognises businesses genuinely pursuing more sustainable goods and services often incur additional production or research costs, so it is worth giving specific examples. The more information they have the better the outcome will be for your business, if it is on a genuine path to net zero.

The Inquiry also presents a formal opportunity for organisations with a fair and transparent method for reporting and communicating sustainability to inform and educate government, for example, by advocating for a new standardised reporting framework.

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What next?

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Monitor how the inquiry is going by checking the submission page regularly. It is also possible to sign up to track the inquiry, so you will be alerted when there have been updates.

For more insight the Committee members can be seen here.

No Senate Inquiry is the same, however given the media attention surrounding the ACCC report, it is highly likely that submissions, committee hearings, and the inquiry findings, which will be released on 5th December 2023 will garner a lot of media attention and a handful of organisations will be singled out for greenwashing.