From AAIA Capital Report
Citing the recent proliferation of green advertising claims on products, the Subcommittee on Commerce, Trade and Consumer Protection of the House Energy and Commerce Committee held a hearing entitled, "Its Too Easy Being Green: Defining Fair Green Marketing Practices." Subcommittee Chairman Rep. Bobby Rush (D-Ill.), stated at the outset of the hearing that, based on the fact that consumers are being bombarded with multiple "green" claims such as "natural, biodegradable, eco-friendly, sustainable." "There is legitimate concern that some consumers are basing their purchasing decisions on misleading and, in some cases deceptive, labels.," he said. Rush said that he hoped the hearing would help legislators understand how businesses use the Federal Trade Commission’s (FTC) Green Guide, which is currently being rewritten, and whether the commission needs to be more aggressive in going after companies that use misleading claims.
James Kolm, director of the FTC Enforcement Division testified that the commission takes a three-pronged approach to ensuring that a company’s environmental advertising is truthful: promulgating rules and guides, such as the Green Guides, that outline the rules of the road for business; challenging fraudulent and deceptive advertisements through enforcement actions; and publishing materials to help consumers make informed decisions. While the FTC does not establish environmental standards, they do ensure that consumers do not become the victims of unfair or deceptive practices.
The FTC is currently in the process of reviewing the Green Guides to ensure they are effective, considering the growth in environmental marketing claims. In addition, the commission is undertaking a consumer perception study. This study will focus on consumer understanding of particular green marketing claims, such as "eco-friendly," "sustainable" and "carbon neutral." The commission expects that the survey and its analysis will be completed later this year.
Urvashi Rangan of Consumers Union testified that, "It is difficult to impossible for consumers to make accurate assessments of green claims in the marketplace on their own." She said that the government could aid guidance for green marketing in three main areas: eliminating or better defining meaningless label claims in the marketplace; setting baseline practices for all green marketing claims; and holding government labeling programs to the high standards with regard to practice and standard setting and ensure independence of standards and verification.
