Welcome to Scribd, the world's digital library. Read, publish, and share books and documents. See more
Download
Standard view
Full view
of .
Look up keyword
Like this
2Activity
0 of .
Results for:
No results containing your search query
P. 1
Hanson Bridgett Brief: "Greenwashing into the Red"

Hanson Bridgett Brief: "Greenwashing into the Red"

Ratings:

4.0

(1)
|Views: 387|Likes:
Published by svnetwork
Capitalizing on consumer interest in sustainability just got more complicated. BP’s Gulf of Mexico oil disaster has reversed years of goodwill built by its “Beyond Petroleum” rebranding campaign, perhaps the best-known green marketing effort in history. But consumers’ growing environmental-marketing skepticism is not the only challenge companies will need to overcome when they tout environmental benefits to their products. The Deepwater Horizon spill is also a political disaster, and it is occurring in the context of renewed interest by the Federal Trade Commission, the courts, and state legislatures in curbing misleading environmental claims. Marketers take note: Prosecution for “greenwashing” is now more likely than-ever before.
Capitalizing on consumer interest in sustainability just got more complicated. BP’s Gulf of Mexico oil disaster has reversed years of goodwill built by its “Beyond Petroleum” rebranding campaign, perhaps the best-known green marketing effort in history. But consumers’ growing environmental-marketing skepticism is not the only challenge companies will need to overcome when they tout environmental benefits to their products. The Deepwater Horizon spill is also a political disaster, and it is occurring in the context of renewed interest by the Federal Trade Commission, the courts, and state legislatures in curbing misleading environmental claims. Marketers take note: Prosecution for “greenwashing” is now more likely than-ever before.

More info:

Categories:Types, Business/Law
Published by: svnetwork on Aug 26, 2010
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as PDF, TXT or read online from Scribd
See more
See less

08/26/2010

pdf

text

original

 
AUGUST
2010 HANSON BRIDGETT BUSINESS
BRIEF
Capitalizing on consumer interest in sustainability justgot more complicated. BP’s Gul o Mexico oil disaster has reversed years o goodwill built by its “Beyond Pe-troleum” rebranding campaign, perhaps the best-knowngreen marketing eort in history. But consumers’ growingenvironmental-marketing skepticism is not the only chal-lenge companies will need to overcome when they toutenvironmental benets to their products. The Deepwater Horizon spill is also a political disaster, and it is occurringin the context o renewed interest by the Federal TradeCommission, the courts, and state legislatures in curb-ing misleading environmental claims. Marketers take note:Prosecution or “greenwashing” is now more likely than-ever beore.
Resurgence in FTC’s Greenwashing Prosecutions
 Ater ling 37 misleading-environmental-marketing com-plaints between 1992 and 2000, the FTC took an 8-year hiatus during the Bush administration, during which itled none. The FTC is now back on greenwashing duty.Speaking to Congress six months ater Pres. Obama took oce, FTC Chairman Kovacic testied that prosecutingmisleading green marketing would be one o the sevenpriority areas or the agency’s consumer protection divi-sion. The agency reported in a March 2009 press releasethat it had developed an “ambitious plan to address the virtual “explosion o green marketing claims.” Since then,the FTC has prosecuted seven companies or green- washing and issued warning letters to a great many more,including some o the nation’s largest retailers. The rst wave o prosecutions ocused on products de-ceptively labeled as “biodegradable.” These included dis-posable plates (Kmart), moist wipes (Tender Corp.), anddisposable towels (Dyna-E). The second wave targetedclothing and other textile products advertised and labeledas being made o environmentally-riendly and biode-gradable bamboo ber when they were actually madeo rayon. The FTC charged our manuacturers, and sent warning letters to 78 retailers, including Wal-Mart, Target,Kmart, and Amazon.
Greenwashinginto the Red:The New Risks ofDeceptive EnvironmentalMarketing
By Jonathan S. Storper and Lance Alarcón
 
Green Packaging Claims, Carbon Offsets, and Green Building: The Next Wave of Prosecutions?
 The FTC’s latest green-marketing policing priorities are expected to be revealed soon with the update to itsGuides or the Use o Environmental Marketing Claims (“Green Guides”). The Guides were last updated in1998. The latest revision process was initiated a year earlier than planned “in response to the explosion ogreen marketing,” according to FTC Consumer Protection Enorcement Division Associate Director JamesKohm. Although the content o the update has not been made public, the FTC’s updating process providesclues about likely new content – and likely new areas o prosecution.In a move that reveals how seriously the FTC is now approaching greenwashing, the FTC gained approvalin 2009 to und its own research on consumer understandings o green marketing terms such as “sustain-able” and “carbon neutral,” terms that were less common when the Green Guides were last updated. (TheGreen Guides already provide standards or terms such as “recyclable,” “biodegradable,” and “environ-mentally riendly.”) The FTC also held a series o public workshops bringing together representatives romindustry, government, consumer groups, environmental organizations, and academia to identiy issues sur-rounding the marketing o carbon osets and renewable energy certicates, green packaging claims, andclaims or green building and textiles. The FTC has not yet published its ndings, but workshop participants have revealed a range o key is-sues that may orm the basis o emerging policing priorities. With regard to carbon osets and renewableenergy certicates, the main concern was that consumers oten have unrealistic expectations about theseproducts, and that there are ew ways or consumers to validate product perormance. In the area o greenpackaging claims, key concerns included consumer misunderstanding o the concept o sustainability andthe potential abuse o unregulated environmental certications. In the area o green building and textiles,there were concerns over the misleading use o general terms such as “renewable”, “organic,” and “non-toxic,” as well as conusion over whether green claims applied to a product’s contents or to the process omaking the product. Given the FTC’s investment in the Green Guides’ update process, these issues seemlikely to infuence uture policing eorts.
 Avoiding Unwanted FTC Attention
FTC greenwashing enorcement actions can be costly and embarrassing or targeted companies. Pastsanctions have included: (i) halting misleading advertising; (ii) reporting periodically to FTC sta about sub-stantiation or new claims; (iii) civil penalties ranging rom thousands to millions o dollars, depending on thenature o the violation; (vi) ull or partial reunds to all consumers who bought the product; (v) requiring newadvertisements to correct the misinormation conveyed in the original advertisements. The Green Guides describe how to avoid FTC intervention. Broad claims must be backed up with speci-ics. Advertising claims will evaluate into the lens o a hypothetical reasonable consumer, which means that vague claims about the environmental impact o a given product might lead to various interpretations. In
 AUGUST
2010 HANSON BRIDGETT BUSINESS
BRIEF
pg
 
2
 
essence, the FTC deems valid any reasonable meaning a consumer might give to advertising. The way toavoid conusion, then, is to be as specic as possible and making claims regarding a product’s environ-mental impact. Substantiation is best provided with competent and reliable scientic evidence in the ormo proessional analysis or research into the environmental impact o a product. The duty to substantiate allreasonable interpretations o environmental claims is made more onerous by the act that the burden is onthe company making the claim to prove that the claim is not deceptive. Proactive use o the Green Guidesto avoid FTC involvement is strongly recommended.
California’s Latent Environmental Marketing Law
Caliornia is among eight states that have enacted laws regulating the use o environmental terms. Calior-nia’s law states that compliance with the FTC’s Green Guides provides a sae harbor or marketers in Cali-ornia, with one exception: Any company that advertises its products using broad claims o environmentalriendliness such as “ecologically sound,” “environmentally sae,” “eco-riendly” or any similar term mustprovide written documentation supporting such claims to any member o the public upon request. Thisdocumentation must, in addition to speciying compliance with the Green Guides were applicable, showthe ollowing: (1) the reasons why the company believes the representation to be true; (2) any signicantadverse environmental impacts directly associated with the production, distribution, use, and disposal othe product; (3) any measures that are taken to reduce the environmental impact directly associated withthe production, distribution, and disposal o the product; and (4) violations o any Federal, State, or localpermits directly associated with the production or distribution o the product. A violation o the statute is amisdemeanor punishable by jail and/or a ne up to $2500. The Caliornia Department o Justice has yet to le a greenwashing complaint under this statute, but at-torneys in its Consumer Protection Department indicate that it is an area o concern or the oce. Becauseinvestigations are kept condential until the Caliornia DOJ begins ling complaints, it is hard to predict whether or when the oce may begin initiating its own prosecutions. The oce has been overwhelmed withmortgage-raud investigations over the past several years, but these may begin subsiding as oreclosuresrun their course. In a state as environmentally conscious as Caliornia, is a sae bet that the Caliornia DOJ will begin tackling greenwashing in the near uture.
Consumers Attack Greenwashing under California’s Unfair Competition Law
Individual consumers, on the other hand, have had several recent successes pursuing greenwashing-typeclaims under Caliornia’s Unair Competition Law. This law allows a consumer who has lost money in relianceon a deceptive-advertising/labeling claim to bring a complaint against the company directly. This year, aconsumer won a $100,000 settlement against Honda under this law or misrepresenting the gas mileage othe Honda Civic Hybrid In addition, there are three pending the class-action lawsuits under this law that havesurvived motions to dismiss. The suits allege that: the maker o Windex put a “Green list” logo on the labelto deceive consumers into believing the product was certied as environmentally-riendly by a third party;
 AUGUST
2010 HANSON BRIDGETT BUSINESS
BRIEF
pg
 
3

You're Reading a Free Preview

Download
scribd
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->