The UK Financial Conduct Authority (“FCA”) recently published the “Finalized non-handbook guidance on the Anti-Greenwashing Rule” to help firms in the United Kingdom understand and implement the rule, which goes into effect on May 31, 2024. The anti-greenwashing rule requires firms to ensure that any reference to the sustainability characteristics of a product or service is consistent with the sustainability characteristics of that product or service, and is fair, clear and not misleading. The rule is intended to protect consumers from exaggerated, misleading or unsubstantiated greenwashing or sustainability claims. The rule also provides consumers with an explicit basis on which to challenge firms that make misleading sustainability-related claims. Sustainability references should be correct, clear, capable of substantiation, and presented without omissions or concealment of important information. Such claims should take into account the entire lifecycle of the product or service, and comparisons to other products or services must be fair and meaningful. Conditional claims should be prominently stated, and any limitations on information should be clearly and prominently disclosed.
The FCA also emphasized in the guidance that the anti-greenwashing rule is intended to complement, not override, other rules in the FCA Handbook. The FCA disclosed that it had worked closely with the Competition and Markets Authority (“CMA”) and the Advertising Standards Authority (“ASA”) to ensure that the anti-greenwashing rule was consistent with the CMA’s guidance on environmental claims, and with ASA guidance requirements.
FCA Publication Summary | Finalized non-handbook guidance on Anti-Greenwashing Rule