Brand manufacturers better watch out with sustainability claims that are not 100 % substantiated: consumers and governments are increasingly critical. Unilever, for example, now finds itself in the crosshairs of British authorities.
The UK Competition & Markets Authority (CMA) will investigate whether Unilever has been guilty of misleading claims about sustainability. According to the competition watchdog, the multinational allegedly made “vague and broad” promises about the sustainability of essential household products. The authority also points to unclear statements about recyclability and the misleading use of natural-looking images and logos – like green leaves, for example.
“Essentials like detergent, kitchen spray, and toiletries are the kinds of items you put in your supermarket basket every time you shop. More and more people are trying to do their bit to help protect the environment, but we’re worried many are being misled by so-called ‘green’ products that aren’t what they seem”, CMA CEO Sarah Cardell told The Guardian.
She has indications that Unilever is unfairly presenting certain products as environmentally friendly. One possible objection could be that Unilever makes sustainability claims about one aspect of a product, only to suggest that it is environmentally friendly as a whole. Claims about certain ingredients can also exaggerate the naturalness of a product. “If we find they’re greenwashing, we’ll take action to make sure shoppers are protected”, Cardell said. The CMA could force Unilever to amend certain practices, possibly even leading to lawsuits.
The announcement of the investigation is noteworthy because Unilever had profiled itself as a global sustainability pioneer for decades, acquiring distinctly sustainable companies such as Ben & Jerry’s and The Vegetarian Butcher. The big driver of that strategy was the group’s former CEO, Dutchman Paul Polman, who stepped down in 2019. Under his successor Alan Jope, however, the multinational went back to focusing more on financial results, and new CEO Hein Schumacher seems to be in the latter’s camp.
This is the difficult position in which many companies – especially those listed on the stock exchange – find themselves today when it comes to sustainability: consumers and governments expect companies to assume their social responsibility, while shareholders primarily want profits to grow and the share price to rise. At Unilever, there was criticism from investors because Polman’s strategy did give the company a sustainable image, while its financial performance lagged behind that of many competitors.
Unilever says it will cooperate with the CMA, but is also “surprised and disappointed” by the allegations. The multinational denies that its claims are misleading in any way. “Unilever is committed to making responsible claims about the benefits of our products on our packs and to these being transparent and clear, and we have robust processes in place to make sure any claims can be substantiated”, the company said in a statement.
But according to Greenpeace and others, Unilever will not deliver on its promises about reusable packaging and banning plastic. “People have bought into Unilever’s claims of sustainability in good faith, expecting those claims to be more than just smoke and mirrors”, said Nina Schrank, head of Plastics at Greenpeace UK.
“The truth is Unilever isn’t living up to that promise, and they never will until the company takes real action to tackle issues like the ruinously huge amounts of single-use plastic they produce. That means committing to phasing out single-use plastic, starting with an end to the billions of highly polluting sachets they’re selling globally each year.”
Companies will not escape the obligation to adopt more sustainable policies: indeed, under the Green Deal, the EU requires companies to report on the progress they make on ESG (Environmental, Social, Governance). At the same time, the EU is imposing stricter rules to counter misleading sustainability claims. Vague claims like “climate neutral” or “eco” would no longer be allowed from 2026.
Consumers are not left out either: several companies are facing lawsuits. Just think of the surely revolutionary court case that Dutch organization Milieudefensie won against Shell: the court imposed an obligation on the oil company to reduce CO2 emissions by 45% by 2030. The company appealed; there is no ruling on that yet. Now Milieudefensie wants to start a new climate lawsuit against companies in the financial sector.