Eric Block On Responsible Branding

Does this count as recycling? | Seth Wenig/AP Photo

By Debra Kahn and Jordan Wolman from Politico.com • Reposted: April 26, 2023

Companies are talking the talk on sustainability. The Federal Trade Commission is gearing up to make sure they’re walking the walk, Jordan reports.

As demand for sustainable products has skyrocketed, so have concerns about greenwashing. Public comments were due yesterday on the FTC’s first update in 11 years of its “Green Guides,” which are essentially advice for how companies can make environmental marketing claims.

The nearly 60,000 comments shed light on what companies, industry trade groups and environmentalists are fighting over:

— Recycling claims. Current FTC guidelines say companies should qualify claims of “recyclability” when products aren’t recyclable in at least 60 percent of their market. The EPA wrote that the bar “should be much higher,” while environmental groups want to clarify that at least 60 percent of products need to actually be recycled — not just collected. That coalition also wants to set a higher bar of 75 percent for store drop-off programs.

The Plastics Industry Association wants the standards to stay as-is: The FTC “should not further complicate the issue by adding hurdles,” the group wrote. It also wants take-back or drop-off programs to be equally eligible to make unqualified recycling claims.

— Corporate net-zero claims. Ceres, a nonprofit focused on corporate sustainability, wants the FTC to give guidance on how companies can use carbon offsets to make claims about their climate commitments and achievements. Sierra Club and a half-dozen other groups want disclosure of specific offsets’ climate benefits.

— Chemical recycling. The American Chemistry Council and the Plastics Industry Association want to make it easier to claim that chemical recycling — a set of technologies that involve melting hard-to-recycle plastic down into its components — counts toward companies’ recycled content and recyclability standards. The ACC submitted a new poll showing that nearly 90 percent of consumers believe chemical recycling qualifies as “recycling.” Green groups are pushing back.

— Enforcement. Environmental groups want the FTC to initiate a formal rulemaking process to codify the Green Guides (currently, the agency can bring enforcement action via violations of the FTC Act), with an eye toward California’s “truth in labeling” law. EPA seems to be on board, too, but the Plastics Industry Association opposes rulemaking.

How much does this all matter? The FTC doesn’t do a ton of enforcement of green marketing claims: It’s taken enforcement action under the Green Guides 36 times since 2013. It hasn’t taken enforcement action based on recycling claims since 2014 — although it does send warning letters, which can nudge companies into compliance.

The agency tends to pick big cases that send a signal — like its $5.5 million penalty last year against Walmart and Kohl’s over claims that they marketed rayon textiles as made from eco-friendly bamboo, when in fact converting bamboo into rayon involves toxic chemicals.

But officials are signaling willingness to wade into the details on new technologies such as chemical recycling.

“Our job is to not say what’s good or bad for society, it is to make sure that people aren’t lying,” James Kohm, associate director of enforcement in the FTC’s Bureau of Consumer Protection, said in an interview. “We wouldn’t necessarily hesitate to get involved in a situation. What we don’t want to do is contradict the EPA, and we’ve been careful in a number of areas to not do that. There are a bunch of trade offs — that you have less trash, but you might have more air pollution, for example. If we had enough information, and we weren’t contradicting the EPA, we would probably give advice.”

We could be in this for the long haul: The last time the Green Guides were updated, the process started in 2007 and didn’t end until 2012. There’s an initial public workshop on recycling scheduled next month.

To see the original post, follow this link: https://www.politico.com/newsletters/the-long-game/2023/04/25/ftc-takes-a-microscope-to-sustainability-claims-00093682