Anti-greenwashing in the UK and EU: the risk landscape and best practice guidance

Greenwashing is making inaccurate or misleading statements about the environmental credentials of a product, service or business, whether unintentionally or as part of a deliberate marketing strategy.

To better protect consumers against greenwashing in a world where “going green” can significantly enhance the value of a brand or product, EU policymakers and the UK government have enhanced consumer protection rules. Regulators too, on both sides of the Channel, are taking an active interest.

In this Insight, we look at the regulatory landscape, litigation risks and outlook for anti-greenwashing measures. We also look at how companies can prepare, manage risk and align with best practice.

The EU

The central pillar in the EU’s bid to tackle greenwashing is the Directive on Empowering Consumers for the Green Transition (also referred to as the “Empowering Consumers Directive”), which entered into force in March 2024. It is designed to strengthen consumer protection against unfair commercial practices and to improve the quality of information available about the environmental and social impacts of products so that consumers can make more informed purchasing decisions. EU countries needed to transpose the Directive into national law by 27 March 2026, and the rules will apply from 27 September 2026.

By amending the Unfair Commercial Practices Directive, the Empowering Consumers Directive extends the list of commercial practices which must be considered unfair, including those associated with greenwashing, for example, making an environmental claim about an entire product or business where it concerns only a certain aspect of the product or a specific activity of the business or claiming  that a product has a neutral, reduced or positive impact on the environment in terms of greenhouse gas emissions where it is based on the offsetting of those emissions.

The Empowering Consumers Directive also mandates that a commercial practice will be regarded as misleading if it involves making an environmental claim related to future environmental performance without clear, objective, publicly available and verifiable commitments set out in a detailed and realistic implementation plan that includes measurable and time-bound targets and other elements necessary to support its implementation and that is regularly verified by an independent third party expert, whose findings are made available to consumers.

Under the Unfair Commercial Practices Directive, consumers harmed by unfair commercial practices must have access to proportionate and effective remedies – as decided by Member States considering the gravity and nature of the practice and damage suffered – including compensation and, where relevant, a price reduction or contract termination.

Member States also will determine penalties to impose on the offending companies, taking into account certain criteria such as the nature, gravity, scale and duration of the infringement; the financial benefits gained by the business and any action taken to mitigate or remedy the damage suffered by consumers. Penalties can include fines of up to 4% of annual turnover if the breaches are carried out as part of a widespread violation in several EU member states.

It was previously expected that the EU would introduce a Green Claims Directive to complement and further operationalise the Empowering Consumers Directive by providing more specific rules on the substantiation, verification and communication of environmental claims. Progress of the Green Claims Directive, however, has stalled, and there is no clear timetable for its revival.

Tackling greenwashing is also a priority for the European Securities and Markets Authority (ESMA), as reflected in its Sustainable Finance Roadmap 2022-2024, its 2024 Final Report on Greenwashing and a Thematic Note published in January 2026. The note sets out four principles for financial market participants to follow when making sustainability claims to ensure claims are clear, fair and not misleading, to avoid the risk of greenwashing. The four principles require that sustainability claims are accurate, accessible, substantiated and up to date.

In addition to the regulatory picture, the litigation risks of greenwashing are also multiplying for companies operating in Europe. In October 2025, a French court ruled that TotalEnergies and its TotalEnergies Electricité et Gaz France, in charge of electricity and gas production on the French market, deliberately made claims likely to mislead consumers about the scope of its environmental commitments (see our briefing here). The Court held that TotalEnergies had misled consumers in its advertising by leading them to believe that by buying its products or services, they were contributing to the emergence of a low-carbon economy without detailing the specific implementation plan for achieving this stated objective. This was at odds with the company continuing to increase its production and investment in oil and gas, against Paris Agreement-aligned scientific advice, which requires an immediate reduction in fossil fuel production. This followed other recent greenwashing verdicts against KLM in the Netherlands and Lufthansa in Germany.

The UK

In the UK, there is no anti-greenwashing law as such. Instead, there is a set of laws and regulatory frameworks designed to protect consumers from misleading claims, including environmental claims. These consumer protection laws and regulations are supported by authoritative guidance – most notably the CMA Green Claims Code 2021, the 2026 CMA guidance on making green claims across the supply chain (“Supply Chain Guidance”) and the UK Advertising Standards Authority (ASA)’s codes.

Historically, the “penalty” for greenwashing in the UK has been censure by the relevant regulator and associated bad press, but this has changed, with the CMA in particular ramping up its efforts to crack-down on greenwashing, equipped with new stronger enforcement powers under the Digital Markets, Competition and Consumers Act 2024 (DMCC). Under the DMCC, the CMA now has the power to investigate suspected breaches of consumer protection law, require undertakings from businesses to cease or modify offending conduct and directly fine companies up to 10% of their global turnover for such breaches, including misleading environmental claims.

Last year (2025), the CMA published a suite of documents detailing its approach to consumer protection. These included (i) The CMA’s approach to consumer protection, (ii) final guidance on unfair commercial practices; (iii) unfair commercial practices: examples; and (iv) a technical note on unfair commercial practices. Though this package of documents is not specifically about greenwashing, the final guidance touches on green claims: that, in relation to “misleading omissions” under section 227 of the DMCC, an example of material information that must be provided to support green claims is that a company must explain the basis on which it makes the claim that a product is ‘greener’, including what is meant by this term and what the product is ‘greener’ than.

To date, the CMA has largely taken a sectoral approach to investigation and enforcement, focussing on those sectors – like fashion retail and fast-moving consumer goods – where environmental claims are prevalent and are capable of influencing a large number of consumers. A CMA investigation into ASOS, George at ASDA and BooHoo resulted in those brands giving formal undertakings to withdraw misleading green claims in 2024. The CMA subsequently wrote to 17 other fashion brands, raising concerns abouts their green marketing claims and published tailored guidance for the sector.

Most recently, in early 2026, the CMA issued Supply Chain Guidance. This guidance builds on the Green Claims Code and helps businesses understand how the rules on making environmental claims apply to supply chains. Companies could be liable in respect of environmental claims whether they make those claims directly or indirectly by passing on information from other entities in the supply chain to consumers, making clear that every business in the supply chain plays a part in ensuring claims are accurate. The Guidance emphasises the importance of putting processes in place to ensure that robust, credible and up-to-date evidence is obtained, and includes separate checklists for retailers, brands selling through third party retailers and for suppliers and manufacturers on what processes to put in place.

All indications are that the CMA will continue proactively to identify and crackdown on greenwashing, increasingly using AI to sweep online communications for potentially misleading green statements and turning the spotlight on new consumer-facing sectors.

The UK financial regulator also continues to prioritise anti-greenwashing. The Financial Conduct Authority (FCA)’s anti-greenwashing rule came into effect in May 2024, and related “naming and marketing” rules began to apply in December 2024. These are part of the FCA’s Sustainability Disclosure Requirements (SDR) and investment labels regime, designed to prevent investment firms from overstating the green credentials of their products to customers. The framework was constructed to tackle greenwashing in the UK financial market by increasing transparency, fostering a fair market and protecting institutional investor interests regarding sustainability claims while ensuring that such claims are fair, clear, and not misleading. It also seeks to establish accurate and well-defined naming and marketing standards for investments.

One further important development in the UK is the Economic Crime and Corporate Transparency Act 2023 (ECCTA), which introduced, among others, a failure to prevent fraud offence in September 2025, which increases the risk that companies could also face criminal consequences for greenwashing. Under the provision, a large organisation commits an offence if certain people associated with the organisation (including employees and agents) commit a fraud offence intending to benefit the organisation. This could capture fraudulent green claims. It is, however, a defence if the organisation could prove that it had in place reasonable prevention procedures, which ties back to the CMA guidance reference above about having proper processes in place to verify green claims. Penalties for the offence can be severe with potentially unlimited fines.

How to manage greenwashing risks in multiple markets?

At the core of different anti-greenwashing regimes are some key common principles. Keeping these in mind will help you spot and manage greenwashing risks in multiple markets:

Make sure the basis for any environmental claim is clear

Do not assume your audience has a high level of understanding. If the green benefit you're promoting depends on the consumer taking specific action or changing their behaviour, spell that out. Pitch your claims at those who may be most susceptible to misleading claims.

Make sure you are backing up environmental claims with robust data and evidence

You can describe a product as "greener" or "friendlier", but only if you can justify the comparison – whether that's against a competitor's product or your own previous version.

Make sure you clearly state any significant limitations or qualifications

Present qualifying information in an easily accessible way so that consumers can see it and factor it in before deciding to purchase.

Make sure your claim covers the full product lifecycle, or clearly explains which part it relates to

Claims like "100% eco-friendly", "less plastic" and "zero emissions" will be treated as full lifecycle claims unless you make clear otherwise, so don't use these terms without qualification. Your advert should not mislead about a product's (or brand's or company's) total environmental impact. Use terms like "environmentally friendly" with caution.

Be aware that consumers often don't understand terms like "carbon neutral" or "net zero"

Given this confusion, make sure you:

• Explain the basis for any such claims.
• Include accurate information about how carbon emissions are being actively reduced, particularly if your claim relates to future goals around reaching "net zero" or achieving "carbon neutrality". These need to be backed by a verifiable strategy.
• Support any claims based on carbon offsetting with clear information about the offsetting scheme you're using, bearing in mind that under the EU Empowering Consumers Directive, discussed above, that it is considered an unfair commercial practice to claim a product has a neutral, reduced or positive impact on the environment in terms of greenhouse gas emissions where it is based on the offsetting of those emissions.

For further guidance and tailored advice on greenwashing legislation or anything else discussed in this briefing, please get in touch with Kerry Stares or with your usual Charles Russell Speechlys contact.