Retail sustainability claims

A retail sustainability claim works when it states what changed, where and when, and the evidence behind it. A claim about one package, store or reporting period does not describe the whole retailer. Start with the claim’s boundary, then check the measure and the outcome.

Identify what is being claimed

Name what the claim is about: a product, its packaging, a store, an operation or the retailer as a whole. Identify the environmental attribute and the period covered, then keep your conclusion within those limits.

A packaging change alone does not prove a whole product has a lower environmental impact. A store waste result says nothing about packaging discarded after customers take goods home.

Read the whole impression

The Australian Consumer Law (ACL), including sections 18 and 29, is relevant to environmental and sustainability claims that mislead or deceive. The ACCC’s final business guidance, “Making environmental claims”, sets out eight principles, including accuracy, specificity and having evidence to substantiate claims; the guidance is not itself law.

The ACCC guides businesses making environmental or sustainability claims to avoid misleading consumers and breaking the law. The United Nations page “Greenwashing – the deceptive tactics behind environmental claims” identifies vague labels such as “green” or “eco-friendly”, which lack standard definitions, as a greenwashing tactic. A qualification hidden from the headline may not correct the impression the headline creates.

Translate a broad phrase into a checkable question. “Less packaging” might mean less material per item, fewer packages sold or lower total packaging mass. If the retailer gives only the phrase, its amount and scope remain unresolved.

Check what the claim leaves out

A claim about one environmental attribute can obscure other impacts. The United Nations identifies presenting a minor improvement as a major one, or highlighting a product feature without its wider production context, as ways claims mislead.

Check whether the claim presents a minimum requirement as a significant improvement, or describes a product feature without acknowledging relevant impacts elsewhere in the business. Recycled material in a product, for example, does not by itself describe the conditions under which it was made. Keep the conclusion tied to the attribute the evidence covers.

Follow the evidence from action to outcome

A retailer can document an action, such as changing a pack design or installing equipment. To assess a claimed result, look for a post-implementation measure, an earlier comparison point and relevant changes in the business.

Use distinct labels for a retailer-reported action, a measured outcome and an external assessment or certification. Do not describe a claim as independently verified or certified unless the verifier or scheme and its scope are identified. Climate Active is described as the Australian Government’s “carbon neutral” certification scheme; its name alone does not establish the boundary or result of a retailer’s particular claim.

For packaging, distinguish a design assessed as recyclable from material actually recovered. The Australasian Recycling Label (ARL) is an on-pack label that helps consumers recycle correctly, but it does not by itself establish how much material was ultimately recycled.

The Australian Packaging Covenant Organisation (APCO) makes access to the ARL Program exclusive to its members, who can use its Packaging Recyclability Evaluation Portal (PREP). PREP assesses packaging specifications against collection availability, Materials Recovery Facility behaviour and subsequent processing; an assessment of recyclability is not evidence of how much material was ultimately recycled.

For waste, distinguish the amount generated from amounts sent to recycling, energy recovery and disposal. National figures cannot establish a particular retailer’s result, so a company claim needs its own defined waste stream and destination evidence.

Timeline of key developments in retail sustainability claims regulation

Check targets as future objectives

Record a target’s base period, deadline, measure and business boundary. For an emissions target, ask which Scope 1, Scope 2 and Scope 3 emissions it covers, including direct, purchased-energy and value-chain emissions; whether it concerns an absolute amount or a ratio; and whether the stated goal relies on carbon credits. A target is not an achieved reduction.

AASB S2 provides a useful framework for entities applying that climate disclosure standard. Its disclosure requirements should not be assumed to apply to every retailer or to a claim on a shelf label.

AASB S2 covers climate-related risks and opportunities that could reasonably be expected to affect an entity’s cash flows, access to finance or cost of capital over the short, medium or long term. It includes disclosure requirements on governance, strategy, risk management, and metrics and targets, including scenario analysis and Scope 1, Scope 2 and Scope 3 greenhouse gas emissions. Its financial-disclosure purpose makes it a reference point for assessing climate information, not proof that any particular retail claim has been independently verified.

Decide what the evidence permits

Use the narrowest conclusion supported by the documents. A measured reduction in waste from specified Australian stores over two comparable years supports a statement about those stores and years. It does not establish less waste across suppliers, customers or overseas operations. If the denominator, collection route or baseline is missing, state the gap rather than treating the claim as proved or disproved.

The ACCC accepts reports about claims people consider false or misleading, and may use them to inform education, compliance and enforcement work. It can investigate a business that breaks the rules and may take compliance or enforcement action. It does not resolve individual disputes or provide legal advice, so an ACCC report is not a ruling on an individual claim.