Volume 43, Issue 11 - November 2008


Shades of Green; Shady Practices
FTC Explores How to Put an End to Untrue Green Claims
by Tara Taffera

When members of the building industry met in July as part of a public workshop hosted by the Federal Trade Commission (FTC) to examine green claims in the building and textiles industry, one fact was certain: many companies are making general “green” claims with little or no basis behind them. The workshop was part of the FTC’s review of its Guide to Environmental Marketing Claims, also known as the “Green Guides.” It was the third one to examine developments in environmental claims, along with consumer perceptions of those claims. 

Some similar themes were voiced by panelists in many of the sessions: how to fit single attributes of a product into a whole building system; the issue of metrics—how to gauge and measure what a label says, and how to compare the different programs in the marketplace; and how the industry can implement life cycle analysis in place of the broad sweeping claims that are made currently.

Different Programs/Different Viewpoints
In one of the sessions, “Overview of Green Claims for Building Products,” Corey Brinkema, president of the Forest Stewardship Council and Rick L. Cantrell, vice president and chief operating officer of the Sustainable Forestry Initiative, gave an overview of their programs. Cantrell brought up the topic of life-cycle analysis, a frequent theme throughout the workshop. 

“We believe in life-cycle analysis and the value that it can bring,” he said. 

The two speakers noted the differences in their programs, such as the fact that the National Association of Home Builders (NAHB) recognizes SFI in its Green Building program as does Green Globes. The USGBC’s LEED program, however, only recognizes FSC-certified products. In another session, representatives of the various green building programs had an opportunity to give an overview of their programs, and again, it was easy to note that there are notable differences among them. The challenge for the FTC is conveying these different programs to the owner and what each label means.

The session, “Framing It Up - Consumer Protection Issues Regarding Green Building Certifications” included the following panelists: Michelle Moore, senior vice president of policy and public affairs at the U.S. Green Building Council; Erin Shaffer, consultant to the Green Building Initiative; Carlos Martín, assistant staff vice president at the NAHB and Sam Rashkin, manager for the Environmental Protection Agency’s Energy Star® for Homes program. 

“Much guidance is needed on green building claims … to substantiate benefits and performance claims,” said Martin. 

The moderator of the session, Robin Rosen Spector of the FTC’s Division of Enforcement, pushed panelists on what specific things the panelists would like to see in the updated Green Guides.

Rashkin said the challenge for the FTC comes down to metrics and how to gauge whether a label meets the criteria defined on the label. He also mentioned how it is difficult to compare the different systems. Since there are a variety of programs in existence, Rashkin said that the best thing the FTC can do is provide guidance about the various green labels.

“In one system, ten points means a lot while in another it means very little,” he said, as an example of the variances between programs. 

FTC: Here to Help 
What may have been the most interesting and valuable session of the day was the closing session titled, “Roundtable on Consumer Protection Challenges and the Need for FTC Guidance.”

Again, the topic of metrics and tying different components into a finished system was discussed. 

“Some companies say ‘If it’s got some recycled content, it’s green. If it’s got some bamboo in it, it’s green.’ We have to figure out how to fit these single attributes into a whole system,” said one panelist. 

The speakers agreed that the FTC can help consumers by providing much needed education. “When you’re shopping for energy efficiency, here are some standards and labels to look for on products and buildings. That’s about the best you can do,” said one panelist.

But the salespeople selling the products also need to be educated.

“Consumers are very gullible and they get most of their information about their purchases from salespeople who represent the companies that are trying to sell them something,” said one panelist. 

While the speakers agreed that some companies are making outrageous claims when it comes to green attributes, session moderator James Kohm, associate director for the Division of Enforcement, asked the panelists to delineate one or two of the most important things the FTC can do to help with this issue. The answers came quickly.
• “Opinions don’t count. We need data,” said Allen Blakey of the Vinyl Institute. “Eliminate broad sweeping claims and offer life-cycle data.” 
• “Substantiation,” said Christine Chase of Green Seal. 
• “People need to know that all certification programs are not created equal,” said John Spears of the Sustainable Design Group. 
• “The manufacturers have to have the data. There really has to be the information that stands behind the brand,” said Kirsten Ritchie of Gensler.  

Examples of Misleading Green Claims

“Many people on the panel today have talked about sustainability as being a three-legged stool, right people, profitability or prosperity and planet,” said Michelle Moore, senior vice president of policy and public affairs at the U.S. Green Building Council. “We would argue that particularly at this stage in our development, there’s a fourth P and that’s proof.” 

During the workshop, speakers talked a great deal about the need to prove claims, and they gave examples of unsubstantiated or unclear “green” claims that are being made every day by companies. The following are but a few that were noted as concerning to the FTC:

“The area we’re concerned about is the fluffy words. It’s the ‘environmentally friendly’ or the ‘eco-safe’ or the ‘great green’ or ‘clean air’—I like that one—those kinds of claims that clearly, there’s no basis behind them. From my perspective they’re using the fluffy language and stuff you guys [the FTC] say don’t use and in many cases it simply needs somebody sending them an e-mail raising a flag and saying, ‘what’s the basis behind this? What’s the data?’” said Kirsten Ritchie, direction of sustainable design for Gensler. 

“I think probably one of the most frequently over-used terms for chemical products, if you will, is non-toxic,” said Stephen Richard Sides, vice president of Environmental Health and International Fairs for the National Paint and Coatings Association.

“In addition to being free of something, it’s comparative claims that are based on little or no data,” said one panelist. 

“PVC-free is a term we run across,” said Allen Blakey, vice president of industry and government affairs for the Vinyl Institute. “We know of one company who says this, but never says what its products are made of.”

“Something touted as being natural. In some cases you may want to use a synthetic. You have to look at the whole thing holistically,” said Thomas Reardon, executive director of The Business and Institutional Furniture Manufacturer’s Association. “That’s where life-cycle analysis comes into play.”

“Often times, a company says my product is 5-percent more recyclable than theirs, therefore we’re environmentally preferable. We don’t buy that. You’ve got to consider the product as well as the process,” said Ritchie. 

“People use terms incorrectly. For example, what does ‘low-emitting’ mean? You have to tell people what the information means,” said one panelist. 

FTC's Guide to Environmental Marketing Claims-
A Closer Look

Following are some excerpts from the FTC’s Guide to Environmental Marketing Claims. To view the guide in full, visit http://www.ftc.gov/bcp/grnrule/guides980427.htm.

Overstatement of environmental attribute: An environmental marketing claim should not be presented in a manner that overstates the environmental attribute or benefit, expressly or by implication. Marketers should avoid implications of significant environmental benefits if the benefit is in fact negligible.

Example: A package is labeled, “50 percent more recycled content than before.” The manufacturer increased the recycled content of its package from 2 percent recycled material to 3 percent recycled material. Although the claim is technically true, it is likely to convey the false impression that the advertiser has increased the use of recycled material significantly. 

Comparative claims: Environmental marketing claims that include a comparative statement should be presented in a manner that makes the basis for the comparison sufficiently clear to avoid consumer deception. 
An ad claims that the advertiser’s packaging creates “less waste than the leading national brand.” The advertiser’s source reduction was implemented some time ago and is supported by a calculation comparing the relative solid waste contributions of the two packages. The advertiser should be able to substantiate that the comparison remains accurate. 

General environmental benefit claims: Every express and material implied claim that the general assertion conveys to reasonable consumers about an objective quality, feature or attribute of a product or service must be substantiated. 
A pump spray product is labeled “environmentally safe.” Most of the product’s active ingredients consist of volatile organic compounds (VOCs) that may cause smog by contributing to ground-level ozone formation. The claim is deceptive because, absent further qualification, it is likely to convey to consumers that use of the product will not result in air pollution. 

Recyclable: A product or package should not be marketed as recyclable unless it can be collected, separated or otherwise recovered from the solid waste stream for reuse, in the manufacture or assembly of another package or product, through an established recycling program. 
Example: A container can be burned in incinerator facilities to produce heat and power. It cannot be recycled into another product or package, and therefore is not recyclable. 

Recycled content: A recycled content claim may be made only for materials that have been recovered or otherwise diverted from the solid waste stream, either during the manufacturing process (pre-consumer), or after consumer use (post-consumer). 
A paperboard package with 20 percent recycled fiber by weight is labeled as containing “20 percent recycled fiber.” Some of the recycled content was composed of material collected from consumers after use of the original product. The rest was composed of overrun newspaper stock never sold to customers. The claim is not deceptive. 

What is Greenwashing?

Merriam Webster defines greenwashing as expressions of environmentalist concerns especially as a cover for products, policies, or activities.Greenpeace defines it as describing the act of misleading consumers regarding the environmental practices of a company or the environmental benefits of a product or service. The organization even created a website, www.stopgreenwash.org, to combat this problem. 


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