FTC Green Marketing Guidelines

In October 2010, the Federal Trade Commission released proposed updates to its so-called "Green Guides" which help companies avoid "greenwashing" (false or misleading environmental marketing claims) by outlining advertising principles and providing guidance on how to appropriately use specific environmental marketing terms. The nearly 250-pages of proposed revisions look to strengthen existing directives on familiar marketing buzz words like "biodegradable," "compostable," "recyclable," and "refillable, as well as newer terminology including "carbon offsets," "renewable energy" and "renewable materials."

While the Guides are non-binding "interpretations" and do not have the force of law, they do provide concrete insight into how the FTC will apply Section 5 of the Federal Trade Commission Act, the law that empowers the agency to punish deceptive practices. And while the agency has filed relatively few environmental complaints — around 45 since the Guides' 1992 implementation — seven of these have come under the Obama administration's watch (compared to zero during the Bush administration). Many believe these cases, along with the release of the updated guidelines, mark the beginning of a "greenwashing" crackdown.

If adopted, the proposed guides would make numerous noteworthy changes. For example, those making general environmental marketing claims — for example, using terms like "environmentally-friendly," or "green," would have to "qualify" or state the basis for their claim.

FTC is also calling for stricter standards for those using certifications, seals of approval and the like to "verify" environmental performance. The FTC considers these tools "endorsements" and therefore companies using them must disclose any "material connections" to the endorser/certifier, including membership in the endorsing association. Moreover, the proposed Guides say that, because an unqualified certification/seal typically suggests a general environmental benefit, marketers should use clear and prominent language that identifies the specific attributes for which they have substantiation and the proposal further notes that third-party certifications do not absolve advertisers of the responsibility of validating their claims independently.

The proposed guides make several clarifications regarding "recycling." For example, FTC is proposing that those making unqualified "recyclable" claims may only do so when and where a "substantial majority" (defined as "at least 60 percent") of consumers have access to a recycling facility able to handle the material. Anything less and companies should be prepared to qualify their marketing claims.

SMART joined scores of stakeholders in weighing-in on the Green Guides proposal. Among other things, SMART argued in its Dec. 10, 2010 comments to the FTC that the proposed language on recycled content claims could potentially preclude pre-consumer materials from being regarded as recycled, thwarting the overall goal of recycling: diverting waste from landfills and using fewer virgin materials.

Much to the chagrin of environmental and consumer groups, the proposed Guides did not delve into popular green terms like "sustainable," "natural," and "organic," because FTC said it either lacked a "sufficient basis to provide meaningful guidance" or wanted to "avoid duplicate rules or guidance of other agencies," (e.g. organics claims made for textiles and other agriculturally-based products are currently covered by the U.S. Department of Agriculture's National Organic Program).

The FTC has said it will release a final Green Guides document once it has considered all of the input it has received, but has offered no concrete timelines.

• October 2010 proposed Green Guides
• SMART’s Dec. 10, 2010 comments to Federal Trade Commission regarding October 2010 proposed "Green Guides" revisions