Greenwashing

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Governance

According to the Grantham Institute’s 2024 Global Trends in Climate Change Litigation Policy Report (the “Report“) – which was published on 27 June 2024 – climate-related litigation against private sector actors continues to be on the rise. The Report highlights that over 230 climate-related lawsuits have been initiated against corporations and trade associations since 2015, with over two thirds of those lawsuits filed since 2020. The Report also highlights that the growth rate of climate-related cases is showing signs of stabilisation, at over 200 new climate-related cases per year. The risk of private sector actors facing climate-related lawsuits is not, therefore, showing any signs of diminishing.Continue Reading CLIMATE LITIGATION – THE GRANTHAM RESEARCH INSTITUTE ON CLIMATE CHANGE AND THE ENVIRONMENT PUBLISHES ITS 2024 GLOBAL TRENDS IN CLIMATE LITIGATION REPORT

Governance

The First Civil Senate of the German Federal Court of Justice, which is in charge of competition law, has ruled that advertising with an ambiguous environmental term (here: “climate neutral”) is generally only lawful if the specific meaning of the relevant term is explained in the advertising itself.

Judgment of June 27, 2024 – I ZR 98/23Continue Reading German Federal Court of Justice on advertising with an ambiguous environmental term

MOSS and glass globes

The European Securities and Markets Authority (ESMA), published a combined report on its 2023 Common Supervisory Action (CSA) and the accompanying Mystery Shopping Exercise (MSE) on marketing disclosure rules under MiFID II. ESMA, together with the National Competent Authorities (NCAs), states that marketing communications and advertisements generally comply with MiFID II requirements. Investment firms generally have procedures in place that ensures compliance with the rules for marketing materials. However, there are increasing concerns about marketing material which includes sustainability claims. ESMA identified several areas of improvements and announces that further supervisory actions in this area shall be undertaken.Continue Reading ESMA’s Final Report on the 2023 Common Supervisory Action and Mystery Shopping Exercise on marketing

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On 14 May 2024, the European Securities and Markets Authority (“ESMA“) published its final report on “Guidelines on funds’ names using ESG or sustainability-related terms” (the “Guidelines“). The Guidelines aim to provide fund managers with clear and measurable criteria to assess their ability to use ESG and/or sustainability-related terms…

MOSS and glass globes

The UK Competition and Markets Authority (“CMA“) has announced that three fashion retailers have signed voluntary undertakings to ensure that consumers have a clearer idea of how green their clothes really are. At the end of March 2024, ASOS, Boohoo and George at Asda committed to only make green claims about their products…

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On 23 April 2024, the UK’s Financial Conduct Authority (“FCA“) published its “Finalised non‑handbook guidance on the Anti‑Greenwashing Rule (FG/24/3)” (the “Guidance“). The FCA has published the Guidance to help in-scope firms understand and comply with the anti-greenwashing rule, which will come into effect on 31 May 2024.Continue Reading UK Financial Conduct Authority publishes finalised guidance on its Anti-Greenwashing rule

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In March 2023, the European Commission proposed the Green Claims Directive (the “Directive“), which aims to tackle greenwashing (read our previous update on the Directive here).  On 12 March 2024, the European Parliament voted in favour of the Directive at first reading. This move further complements the EU’s commitment to empowering consumers, ensuring fair competition and fostering a more environmentally responsible marketplace.Continue Reading The Green Claims Directive: European Parliament approves at first reading

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A new California ”anti-greenwashing” law comes into effect on January 1, 2024.  The law – called the Voluntary Carbon Market Disclosures Act (AB 1305) (VCMDA) – casts a wide net over companies participating in the California voluntary carbon market or that make certain “green” claims within California.  The VCMDA applies regardless of revenue thresholds if…

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The risk of an accusation of “greenwashing” is now an important concern for many companies. Greenwashing is an ill-defined concept but, nevertheless, is increasingly a source of litigation and regulatory scrutiny – with more of both expected. It carries with it reputational, regulatory and litigation risks for which companies should be prepared. Whilst the risks are always context specific – varying by jurisdiction, industry…