Greenwashing is when businesses or organisations make false, misleading or deceptive claims about their social and environmental practices or the attributes of their products. It includes claims that are inaccurate, vague, irrelevant, false or just don't tell the full story.
Greenwashing can be a serious brand risk, resulting in bad publicity and consumer mistrust.
It could also result in fines ranging from $60,000 (for an individual) to $200,000 (for a company) if you're found to be breaking the law. The New Zealand Commerce Commission released guidelines to help companies determine whether green claims such as carbon neutrality could be in breach of the Fair Trading Act.
Understanding and identifying greenwash in procurement is important to ensure the environmental integrity of your products and services. Page 39 of The Australian Government's Sustainable Procurement Guide provides useful information on how greenwashing affects procurement and how to recognise and avoid it.
Further information on eco-labels and sustainability claims, including the regulations that you need to know about, is available here.