Consumers are demanding more green products and services every year, and many companies are taking steps to meet those demands.

However, as your company markets its green efforts, you need to be careful how you let your customers know about your initiatives. For example, you can get into trouble by attaching a green arrow symbol to your packaging material or making unsubstantiated claims about energy savings.

The Federal Trade Commission, in cooperation with the Environmental Protection Agency, 10 years ago developed guidelines for environmental marketing claims, called Green Guides. But today’s marketplace is quickly outpacing those guidelines, which have not been updated since 1998. With consumers pushing toward environmentally responsible products, more companies are trying to paint themselves with the green brush, but not always accurately.

Environmentalists call this sort of misleading advertising “greenwashing.”

The FTC was scheduled to review the Green Guides this year, but because of a sharp increase in green advertising claims, the agency started its review in 2008. The guidelines are administrative interpretations of federal law and are intended to provide a safe harbor for companies that make green marketing claims. The guidelines apply to environmental claims used anywhere in the marketing mix, including labeling, promotional materials and websites.

As with all advertising, environmental claims must have a reasonable basis to substantiate asserted claims. In green marketing, these claims often require scientific evidence to verify the claim. The claims must specify what portion of the product is affected by such a claim.

Following the FTC guidelines, especially those that require advertisers to keep all claims substantiated and specific, will not only help a company avoid investigative action by the FTC but also can help companies avoid false advertising complaints filed against them by competitors, either in an administrative proceeding before the National Advertising Division of the Council of Better Business Bureaus or in a federal lawsuit. False advertising claims can derail a green product campaign or prevent a company from successfully marketing their environmental attributes.

Common pitfalls
Advertisers should avoid these common pitfalls in environmental advertising:

Distinctions between the benefits of the product and the package — The environmental claim should make clear if it refers to the product itself or the product’s packaging. For example, if a box of aluminum foil is labeled “recyclable,” the claim is deceptive unless both the foil and the box can be recycled. Yet, if only a minor portion of the total package is not recyclable (such as a soft-drink bottle cap), it would not be deceptive to label the package as recyclable.

Overstatement of environmental impact — The environmental claim should not be stated in such a way that would lead an average consumer to believe it has a more significant impact than in fact it does. For example, a package labeled as “now 50 percent more recycled content,” when the manufacturer increased recycled materials from 2 percent to 3 percent, conveys a false impression for consumers even though it is technically true.

Comparisons — When a marketing claim includes a comparison, the basis for comparison must be clear and the advertiser must substantiate the comparison. For example, when claiming that packaging creates “less waste than the leading national brand,” the advertiser must support the assertion with a calculation comparing the two packages, and the claim must remain accurate.

General environmental claims — It is deceptive to misrepresent that a product or package offers a general environmental benefit. Unqualified claims, such as “Eco-Safe,” “Environmentally Friendly” or “Environmentally Safe,” are especially troubling because they are difficult to interpret and may have a variety of meanings. Unless a claim can be substantiated, broad environmental claims should be qualified or avoided.

Biodegradable — A claim that a product or package is degradable, biodegradable or photodegradable should be supported by scientific evidence that the entire product or package will completely break down and return to elements found in nature within a reasonably short time after customary disposal. For example, if trash bags are usually disposed of in landfills that do not have the water and oxygen needed to allow for decomposing, it is deceptive to market the bags as degradable.

Recyclable — A product or package should not be marketed as recyclable unless it can be recovered for re-use through an established recycling program. For products or packages that are made of recyclable and non-recyclable components, the claim should be qualified to avoid consumer confusion. Recycling facilities for the particular component must be available to a substantial majority of consumers or communities, or else the claim should clearly identify the limited availability of such facilities.

“Please recycle” — Including this phrase on products or packaging causes consumers to believe an item is recyclable. As with the “recyclable” phrase, unless recycling sites are available for the particular product to a substantial majority of the consumers or communities, this phrase should not be used.

Recycled content — A company can claim recycled content only for materials diverted from the solid-waste stream, either during the manufacturing process or after consumer use. Distinctions should be made between pre-consumer and post-consumer materials on the product or package. It is deceptive to claim a product or package is made of recycled material when it includes raw material or reconditioned components. The claim should pertain to the entire product or package, except for minor, incidental components (such as a soda-bottle cap). Otherwise, the claim should be adequately qualified.

Source reduction — Source reduction claims should be qualified to avoid confusion about the amount of the reduction and basis for comparison. For example, an advertisement claiming the packaging is “now 10 percent less than our previous package” is appropriate if that claim can be substantiated and the comparison is to the immediately preceding version of the package.

Eco-seals and certifications — Environmental stamps of approval from third-party organizations are equated in the minds of consumers with environmentally superior products. A broad claim of superiority can be difficult to substantiate. Therefore, these third-party approvals should be accompanied by a qualification explaining the certification. Such third-party certification does not eliminate FTC scrutiny, so all other regulations should be followed.

Mary True is a partner and Stephanie Jandik an associate in the green strategies group of the firm of Bricker & Eckler in Columbus, Ohio.