FTC Urged to Tackle Corporate Greenwashing with New Green Guides

Advocacy groups want FTC to tackle net-zero claims, offsets, 'natural' gas, greenwashing

Ginny Cleaveland, Deputy Press Secretary, Fossil-Free Finance, Sierra Club, ginny.cleaveland@sierraclub.org, 415-508-8498 (Pacific Time)

Washington, DC – Climate and environmental groups are urging the Federal Trade Commission (FTC) to tackle corporate and fossil fuel greenwashing with the latest revision of the agency’s “Green Guides.” 

The Green Guides provide guidance to companies on how to make environmental claims in their advertising and marketing. The last time the guides were updated was in 2012. In its announcement about the revision, the FTC specifically asked for public comments on carbon offsets, renewable energy, and climate change, amongst other issues. Comments are due April 24th and the guides are expected to be updated later this year. 

Groups including Action for the Climate Emergency, Clean Creatives, ClientEarth, Earthworks, Earthrights, Food and Water Watch, Gas Leaks, Global Witness, InfluenceMap, and the Sierra Club are all in the process of submitting comments to the FTC urging new guidance to combat what the groups describe as a “tidal wave” of greenwash coming from corporations, and fossil fuel companies in particular. 

The groups are specifically calling for the FTC to:

  • Bring the FTC’s Green Guides into alignment with international standards addressing greenwashing, such as the EU’s recently released draft Green Claims Directive that increases disclosure requirements for environmental claims, and the UK-based ASA’s guidance restricting advertisers from promoting isolated green products without addressing the overall impact of their business.
  • Recognize that the term “natural gas” is inherently misleading when used in reference to methane, since “natural” misleads consumers into thinking that methane is environmentally friendly instead of a potent greenhouse gas, and adopting stricter guidance against misleading terms such as ‘renewable natural gas.’
  • Clarify how “net zero” claims need to be substantiated, especially for fossil fuel companies, many of whom advertise net zero targets without actual plans to achieve them.
  • Tighten rules around the marketing of “carbon offsets” and the use of offsets to justify sustainability claims. Studies have shown that the benefits of a vast majority of offsets are greatly overstated.
  • Restrict the amount fossil fuel companies can advertise their investments in clean energy to correspond with the amount of money those companies are actually investing (the vast majority of fossil fuel advertising talks about climate solutions, even though only a tiny percentage of the companies’ capital expenditures are spent on them).
  • Stop companies from using vague and generic environmentally friendly terms like “clean,” “sustainable,” “natural,” or “renewable” to describe fossil fuels, such as hydrogen. 
  • Strengthen enforcement of the guidelines to ensure that companies are held accountable for any misleading claims.

In their comments to the FTC, the groups emphasize that strong guidelines are necessary to prevent greenwashing, ensure that consumers can make informed choices about the products they’re buying, and bring much needed transparency to issues surrounding the energy transition. 

That’s especially true when it comes to fossil fuel advertising. A recent study from Brown University concluded that the five largest oil companies have spent over $3.6 billion on “reputation building” advertising over the last 30 years. As a report by ClientEarth concluded, the vast majority of that advertising “routinely misrepresented the sustainability of [fossil fuel] activities” in an effort to mislead consumers. Another study by Harvard researchers in 2022 found that 72 percent of social media posts by oil and gas companies engaged in some form of greenwashing. 

The FTC is expected to issue a revised version of the Green Guides by the end of this year. 

Quotes from advocacy groups:

“Americans who care about the health of our planet and communities try to do their best as consumers to reward environmentally responsible business practices. But when companies make deceptive marketing claims about ‘carbon neutrality’ and other alleged climate benefits of their products, it frustrates consumers, who have to sift through the greenwashing,” said Ben Cushing, Campaign Director of Sierra Club’s Fossil-Free Finance Campaign. “We need the Federal Trade Commission to protect consumers from this climate deception — including requiring companies to explain their reliance on dubious carbon offsets when making claims about reduced emissions.” 

“The Green Guides are an opportunity for the FTC to address one of the greatest barriers to climate action: greenwashing and false advertising from the fossil fuel industry,” said Duncan Meisel, executive director for Clean Creatives. “Big corporations, and fossil fuel companies in particular, have been getting away with lying to consumers about their net zero commitments, carbon offsets, and the environmental benefits of so-called ‘natural’ gas. Stricter guidance from the FTC would not only help clear the airwaves of this misinformation, but send a warning to advertising agencies that these sorts of misleading claims will be subject to greater regulatory and legal scrutiny.” 

“Americans’ increasing interest in environmental issues influences their purchasing decisions, but the prevalence of greenwashing means people buy products that do not actually have the positive environmental impact they expected,” said Camille Sippel, climate attorney for ClientEarth. “Stronger and updated guidelines are an important step to ensure consumers are not misled about how they spend their money.”

“Greenwashing is as harmful as it is dangerous because it is so effective. We live in an age of misinformation; when industries advertise they are environmentally friendly, many people believe them,” said Issac Smith, Youth Advisory Board for Action for the Climate Emergency. “Greenwashing allows corporations to claim they benefit the environment while being the very same people destroying it. And it's legal! For any government to tolerate lying to the public is to put private interests above public welfare.”

“The public deserves honesty about growing levels of pollution from the ‘natural’ gas system and the significant limitations of false solutions like ‘renewable natural gas,’” said Caleb Heeringa, Campaign Director of Gas Leaks. “The gas industry’s advertising of ‘renewable natural gas’ leads the public to believe that the gas system is somehow getting cleaner and greener, which provides cover for more fracking, more pipelines and more climate disruption. It’s time for the FTC to shine some light on this misleading advertising."

About the Sierra Club

The Sierra Club is America’s largest and most influential grassroots environmental organization, with millions of members and supporters. In addition to protecting every person's right to get outdoors and access the healing power of nature, the Sierra Club works to promote clean energy, safeguard the health of our communities, protect wildlife, and preserve our remaining wild places through grassroots activism, public education, lobbying, and legal action. For more information, visit www.sierraclub.org.