Asda, Asos and Boohoo pledge 'accurate and clear' green claims amid CMA pressure
- CMA launched an investigation into potential greenwashing at the firms in 2022
Asda, Asos and Boohoo have promised to ensure customers are given accurate information about how environmentally friendly their clothes are after a 20-month regulatory probe.
The Competition and Markets Authority (CMA) said it had secured agreements from the three companies that commit them to informing their customers properly in the future.
The CMA launched an investigation into potential greenwashing at the firms in the summer of 2022, claiming it was concerned some clothes in the companies’ ranges did in fact not meet green criteria.
We promise: Asda, Asos and Boohoo have promised to ensure customers are given accurate information about how environmentally friendly their clothes are, the CMA said
The watchdog said at the time that it might take the businesses to court if their claims did not 'stack up'.
But on Wednesday it announced it had come to an agreement whereby none of the firms admit any wrongdoing, but promise to follow a set of rules.
Asos has a 'Responsible edit' range, Boohoo sells clothes under 'Ready for the Future', and Asda has 'George for Good'.
Asos, Boohoo and George at Asda make over £4.4billion annually from UK fashion sales, the CMA said.
In future, the criteria for inclusion in these ranges must be 'clearly set out and detail any minimum requirements,' the CMA said.
It added: 'For example, if products need to contain a certain percentage of recycled fibres to be included in the range, this should be made clear.'
Going forward, products must meet all criteria to be included in one of the ranges.
Probe: The CMA launched an investigation into potential greenwashing at Asos, Asda and Boohoo in the summer of 2022
Letter: The CMA has issued an open letter to the sector advising all fashion retailers to review their green claims and practices
The CMA said the firms must stop using terms like eco, responsible or sustainable, which are vague, and instead use words with more concrete definitions like organic or recycled.
Even then, the firms in question cannot use those words unless certain criteria are met and the proportion of recycled or organic fibres in a garment must be easily displayed.
If a company has some kind of green accreditation, it must also make it clear whether that applies to an individual product, or its wider practices.
Asos said it welcomed the CMA's commitment to ensuring equal standards are applied across the industry.
Boohoo and Asda also said they were pleased to have mutually agreed the voluntary undertakings with the CMA.
An Asda spokesperson said: 'We have proactively engaged with the CMA throughout this process and are pleased to have mutually agreed the voluntary undertakings.
'We support any measures aimed at improving consumers’ understanding of environmental claims and providing clear and consistent guidelines to the fashion industry as a whole regarding the future use of such claims.'
CMA chief executive Sarah Cardell said: 'Following our action, the millions of people who shop with these well-known businesses can now have confidence in the green claims they see.
'This also marks a turning point for the industry.
'The commitments set a benchmark for how fashion retailers should be marketing their products, and we expect the sector as a whole – from high street to designer brands – to take note and review their own practices.'
The regulator has issued an open letter to the sector advising all fashion retailers to review their claims and practices.
Regulators are increasing scrutiny of companies which may be exaggerating their green credentials in an attempt to woo climate-conscious consumers, as well as billions of dollars from environmentally focused investor funds.
Christopher Eberhardt, counsel at Ashurst law firm, said: 'This is the first example of enforcement action against misleading green claims by the CMA under consumer law. It therefore reminds all businesses of the importance of ensuring that their green or sustainability claims are accurate and not misleading.
'The undertakings offered by the retailers largely build on the existing principles under the CMA’s Green Claims Code. They also include provisions requiring the retailers to ensure their supply chains meet requisite standards, which is a challenge many businesses face when making and verifying claims about their products.
'The CMA has also reminded all businesses that, once its new consumer enforcement powers enter into force later this year, they could face substantial fines for misleading green claims.'
