Are Green Labels Reliable? Congressional Hearing Addresses Greenwashing

Vivi Gorman
Posted on Tuesday 30th June 2009

In your quest to be energy- and environmentally- conscious, can you rely on manufacturers’ claims or product labels to be accurate? Should a manufacturer turn a profit on a dishwasher, washing machine or refrigerator that uses twice as much energy as it claims? Can you trust a label that says “no phthalates,” “non-toxic,” “natural” or “green?”

While there are valid certifications and labels out there, vague and deceptive assertions about a product’s features or ingredients are not acceptable, a panel told a U.S. House of Representatives subcommittee. A hearing was held on June 9 before the House Subcommittee on Commerce, Trade, and Consumer Protection to examine "green" marketing claims, how consumers construe such claims, and whether the Federal Trade Commission (FTC) ought to establish guidelines for fair green marketing practices.

At "It's Too Easy Being Green: Defining Fair Green Marketing Practices," the subcommittee heard testimony from James Kohm, Director of the FTC Enforcement Division; M. Scot Case, Vice President of TerraChoice Environmental Marketing Inc. and Executive Director of EcoLogo Program; Urvashi Rangan, Ph.D., Director of Technical Policy at Consumers Union, publisher of Consumer Reports; Dara O'Rourke, Ph.D., Associate Professor at University of California Berkeley and co-founder of GoodGuide; and Scott P. Cooper, Vice President of Government Relations at the American National Standards Institute (ANSI).

Scot Case of TerraChoice shared how he purchased an Energy Star refrigerator and later discovered that it consumes twice as much energy than advertised. He said the U.S. Environmental Protection Agency (EPA) and Department of Energy (DOE) are permitting manufacturers to use the Energy Star label on products without verifying compliance with the requisite criteria.

In studies he conducted in 2007 and 2009, approximately 98 percent of the thousands of “green” products reviewed had labels with false claims. Consumers and manufacturers are lacking sufficient guidelines about labels, he said. Given that American consumers are one of the most powerful forces globally, green innovation, jobs and economic growth could be realized if some uniformity about promoting products were developed, he suggested. Market-based environmentalism is dependent on consumers being provided accurate, reliable, and relevant environmental information about the products they buy; misrepresentations and deceptive labels undercut this possibility, he said.

Urvashi Rangan administers Consumer Reports’, which maintains an eco-labels database. He said FTC involvement is necessary to combat fraudulent marketing and that standards should be established for fair marketing practices.

Dara O’Rourke testified that her research takes a “life cycle” approach in examining the impacts of a product from raw material extraction, manufacturing, product use, and to end-of-life disposal. At GoodGuide, information is disseminated to the public on the health, environmental, and social impacts of products and companies. The GoodGuide team is evaluating upwards of 75,000 personal care, household chemical, toy and food products, using over 200 data sources. She is concerned that as a nation we have poor information about how healthy or eco-friendly many products are and that it is costly to track down such information.

“This gap between what consumers want to know, and what companies communicate about their products, continues to grow, and has led to frustrated and confused consumers who literally cannot differentiate between green products and ‘greenwashing’ companies. And as demand for fuller information on products is skyrocketing, so are questionable marketing claims. Incomplete or misleading information leads to consumers purchasing products and supporting manufacturing practices that they might actually oppose if they had better information. This confusion also undercuts the market for truly greener products,” she explained.

Scott Cooper of ANSI spoke about ANSI's work to develop public-private partnerships to promote credible standards and assessment practices in the sustainability sector. He also talked about health information technology, toy safety, the EPA’s WaterSense initiative for water conservation, and the DOE’s and National Institute of Standards and Technology’s efforts regarding new nuclear power plants.

"Where consumers see value in 'going green,' there is a competitive advantage to those companies that can supply environmentally sustainable products," explained Mr. Cooper. "But where an advantage can be perceived, there will be those who want to 'game' the system. We need to ensure the credibility and consistency of environmental claims,” Cooper said.

test image for this block