Fashion group H&M and sports retailer Decathlon will temporarily remove sustainability-related labels from their products and websites, following an investigation by a Dutch regulator.
- Decathlon and H&M have been accused of making unsubstantiated sustainability claims, forcing them to make changes in labelling.
- Companies are expanding their sustainability-labelled products in response to consumer demand, meanwhile the pace of actual sustainable progress has slowed by a third.
- The action comes as the beginning of a wider crackdown on greenwashing, but further regulation will be needed to tackle the core of the issue.
The Netherlands Authority for Consumers and Markets (ACM) has sought reparations from Decathlon and H&M for making what it considers “unclear and insufficiently substantiated sustainability claims”.
The Dutch regulator has been studying sustainability claims made by businesses since 2020, and more recently launched a thorough investigation into six companies within the clothing sector.
This is part of a growing number of cases driven by concern about consumer understanding, from fashion brands, detergents and even utilities.
On the back of the ACM’s findings, Decathlon has agreed to temporarily remove all sustainability claims from its websites, donate €500,000 towards sustainable causes, and to improve the explanations of its claims.
H&M, meanwhile, will remove its ‘Conscious’, ‘Conscious Choice’ and ‘more sustainable materials’ labels until they are compliant with relevant rules. The group has also agreed to assess how it can better communicate any valid sustainability benefits of its products, and will pay its own donation of €400,000 in compensation.
Decathlon and H&M may not be the worst offenders
McKinsey estimates that the fashion and apparel sector accounts for around 2.1 billion tonnes of greenhouse gas emissions each year, while the Ellen MacArthur Foundation reports that textile manufacturing alone consumes an annual 98 million tons of nonrenewable resources.
As consumers have grown more aware of the industry’s devastating environmental impact, the demand for more sustainable alternatives continues to rise. In a bid to capitalise on this demand, companies within the sector have expanded their offering of products labelled with green claims.
According to a 2021 report by the Changing Markets Foundation, however, 59% of these claims could be deemed unsubstantiated or misleading. Its findings are based on questionnaire data and desk research on 46 brands, with up to 91% of claims made by the top three offenders falling into this category.
This research indicates the systemic nature of the problem, which extends far beyond the claims made by Decathlon and H&M. Indeed, despite their misleading and exaggerated sustainability labels, there is fair evidence to suggest that each brand has taken some demonstrable action to improve their impact.
Decathlon has released a climate transition plan, approved by the Science Based Targets Initiative, with commitments including a switch to 100% renewable electricity across all stores and warehouses, the implementation of its ‘eco-design strategy’ and the establishment of dedicated repair workshops to limit waste.
H&M, meanwhile, has developed an openly available tool for designing clothing with circularity in mind, launched an extensive in-store recycling programme and increased its share of recycled materials.
Cracking down on greenwashing
The ACM’s action against Decathlon and H&M is just the beginning of what promises to be a far wider crackdown on the fashion industry’s greenwashing sustainability claims.
In the UK, for example, the Competition and Markets Authority (CMA) is investigating claims made by ASOS, Boohoo and George at Asda, as part of a larger effort to develop its Green Claims Code.
The code contains six principles based on existing consumer law, establishing how and when sustainability-related claims can be deemed acceptable. After a short bedding in period, failure to comply with the code could result in legal action.
As explained by Andrea Coscelli, the CMA’s chief executive, “more people than ever are considering the environmental impact of a product before parting with their hard-earned money. We’re concerned that too many businesses are falsely taking credit for being green, while genuinely eco-friendly firms don’t get the recognition they deserve.”
The EU, meanwhile, is developing a Strategy for Sustainable and Circular Textiles, which will include more thorough disclosure requirements and stricter controls on greenwashing, including a ban on environmental claims that are not underpinned by official certification.
Talking the talk must be accompanied by walking the walk
A crackdown on sustainability claims made by the fashion industry is undoubtedly important in ensuring that consumers can base their purchasing decisions on accurate information, thereby reducing excessive consumption based on the belief that a product has had a reduced impact on the environment.
There is, however, a crucial difference between legislation on what brands can say and what they must actually do. To truly address the fashion industry’s sustainability problem, steps need to be taken beyond banning green claims and towards making them a reality.
Currently, the fashion industry operates largely through self-regulation. Although it is included under broader policies such as the EU’s Extended Producer Responsibility legislation, there are few legally binding restrictions that apply specifically to clothing and apparel.
Will there be a shift from industry led to more formal accountability?
Initiatives such as the Fashion Industry Charter for Climate Action, the UN Alliance for Sustainable Fashion and the G7 Fashion Pact, have developed frameworks for how the fashion industry can actionably manage its environmental impact, but these are voluntary measures that cannot be enforced.
Government agencies, however, could play a central role in ensuring that more sustainable practices are implemented. They could, for example, ban the use of certain materials or introduce taxes to pay for the development of effective recycling infrastructure to reduce the consumption of virgin resources.
Some small steps have been made in this regard, including laws forbidding the use of certain chemical dyes and France’s ban on the destruction of unsold or returned items. The upcoming EU strategy will take this approach further, with measures such as the introduction of ‘mandatory Ecodesign requirements’ and further extensions to its producer responsibility regulation.
These measures will be vital in tackling the clothing sector’s environmental impact at its very core. As declared by the UK’s Environmental Audit Committee in its call for British legislators to introduce more stringent legislation, “the fashion industry has marked its own homework for too long.”