The FTC Examines Green Claims for Textiles and Buildings

On July 15, the Federal Trade Commission ("FTC") held the third installment of its "Eco in the Market" workshop series designed to help the FTC review and revise its Guides for the Use of Environmental Marketing Claims ("Green Guides" or "Guides"). The Green Guides were originally promulgated in 1992 and revised in 1998 to help producers promote the green qualities of their products without misleading consumers and running afoul of Section 5 of the FTC Act. Since 1998, consumer interest in sustainability, global warming, and the environment has exploded and industry is developing innovative "green" initiatives, prompting the FTC to revisit the Guides.

The July 15 workshop focused on environmental marketing claims about textiles and buildings, including construction materials and real estate marketing. The textile panels examined how consumers perceive the dramatic increase in green claims for clothing and home décor made from recycled fibers and naturally sourced fibers such as organic cotton and bamboo. The textile panelists discussed how consumers find deciphering green claims difficult and, as a result, they often make incorrect assumptions about product quality.

The building panels examined the proliferation of independent, non-mandatory certification schemes for construction materials and finished buildings. With so many certification schemes, producers and consumers find it hard to communicate effectively about the "eco-friendliness" of various construction materials or buildings.

But what does this all mean for producers? The panelists all agreed that the FTC should bring the Guides into conformity with the changes in the marketplace. The panelists seemed most interested in having the new Guides address the following three issues:

• Ambiguous terms: The general terms such as "green," "eco-friendly," and "sustainable" do not give consumers enough information to make responsible purchasing decisions. Even worse, some panelists suggested that ambiguous terms allow producers to purposely deceive consumers. Panelists suggested that the forthcoming revision of the Guides should either define a list of general terms or detail how producers can use such terms to increase consumer awareness and understanding.
  
  
• Attributes: Panelists, especially from the textile industry, suggested that the revision should address whether marketing claims refer to a single attribute of the final product or multiple attributes. For example, if a producer markets a tee shirt as "100% organic," does that refer to the all fibers of the shirt (including the thread), the hang tag, the packaging in which it was shipped, and entire manufacturing process or just one particular attribute? Without specifying the attribute(s) to which a claim refers, consumers are left vulnerable to misleading information.
  
  
• Product Lifecycle: Panelists in the building sector suggested that the new Guides account for a product's lifecycle. A claim about a product's eco-friendliness at the time of production may be deceptive, considering the environmental impact of the product over its complete lifetime. An inorganic, petroleum-based construction material – for example – may reduce energy costs better than an organically sourced material over the lifetime of the building. Panelists generally agreed that consumers want this information and the new Guides should instruct producers on providing it.

The FTC did not commit to a timeframe for when the new Guides will be available. Until then, producers should rely on the current Guides and be as specific as possible with any "green" claims. Producers should also be careful not to overstate the environmental attributes or "eco-friendliness" of their products.