Greenwashing & the CPA

Part 1 in a 6 part series: An introduction to the concept & the purpose of the CPA, as it relates to greenwashing.
Much has been said and written about greenwashing and it is a popular topic among not only environmentalists but the general public, especially now issues such as ‘getting off the grid’ has been become a ‘social agenda item’!
So let’s start with a definition (Courtesy of Wikipedia):
Greenwashing (a compound word modelled on “whitewash”), also called “green sheen”, is a form of spin in which green PR or green marketing is deceptively used to promote the perception that an organization’s products, aims or policies are environmentally friendly. Evidence that an organization is greenwashing often comes from pointing out the spending differences: when significantly more money or time has been spent advertising being “green” (that is, operating with consideration for the environment), than is actually spent on environmentally sound practices. Greenwashing efforts can range from changing the name or label of a product to evoke the natural environment on a product that contains harmful chemicals to multimillion-dollar marketing campaigns portraying highly polluting energy companies as eco-friendly. Publicized accusations of greenwashing have contributed to the term’s increasing use.
The purpose of this series of articles is to address the concept in general and then to provide the link with the CPA, the role it plays and how consumers can enforce their rights regarding greenwashing, whether it is from a practical point of view or regarding the negative impact a product may have on the environment. As defined above, this occurs when a consumer is led to believe his/her purchase will have a minimal or at least not detrimental impact on the environment hence the motivation to buy a particular product in preference to another, but when you ‘scratch below the surface’, the purchase rationale is misplaced.
Let’s start by asking the question: who is a consumer?
The CPA identifies 4 parties who may be consumers i.e.
  • The party to whom goods or services or services are marketed – the latter is defined as to ‘promote’ or ‘supply’. It is important to note that these activities include the following: ‘promote’ includes ‘advertise, display, offer, (actual) supply, presentations and/or an inducement to buy’ & ‘supply’ includes re goods: ‘sell, rent, exchange’ & re services: ‘sell, perform, cause it to be performed or to provide access to premises, event or activity’. (This may all sound of academic interest but I’ll illustrate in future articles why it is imperative to be familiar with these definitions so that you understand your rights and liabilities regardless of  whether you are a consumer or a supplier, hence the emphasis above and below that an actual sale is not required for the CPA to be applicable!)
  • The party who enters into a ‘transaction’ for the supply of goods or services. This includes not only the actual supply (provision or performance of either) but also the ‘potential’ supply or performance. Link this to ‘advertise, display, offer … presentation … inducement’ above and you can see how wide the impact can be!
  • The (end) user of the product of services, whether or not such user is a party to the transaction. This is very important with reference to liability because it is highly unlikely that such user has had sight of e.g. the applicable T&C and/or such limitation of liability issues therein and/or waivers and indemnities.
  • Franchisees. Note that this is the case regardless of the turnover or value of the assets of the franchisee. (Read with ‘Threshold’ provisions section 6.)
Now let’s look at the (main) purposes of the CPA and the link to protecting our environment.
  • Fair and responsible marketing.
  • Assist consumers that fall into one or more of the following categories: disadvantaged by virtue of income, remote location, age, literacy or visual impairment or ‘limited fluency in the language (used)’, especially where ANY of the aforesaid impacts on the consumer’s ability to  ‘read and comprehend any advertisement, agreement, mark, instruction, label, warning, notice or other visual representation’. (I will elaborate on this KEY aspect as we move along.)
  • Promote fair business practice.
  • Protect the consumer against improper marketing and conduct i.e. ‘unfair, unjust … improper trade practices and deceptive, misleading, unfair or fraudulent conduct’.
  • ‘Improving consumer awareness and information.’
So where does this leave the consumer? It has various options in terms of which (Section 4) it can realize its rights which ultimately is the ‘outcome’ of the consumer centric purposes of the CPA. (More about this later.)
Future articles will look at the CPA requirements regarding the obligations (but also rights – a much ignored and maligned aspect the CPA) of suppliers regarding disclosure, marketing, the sales process, product safety and conversely the consumer’s rights regarding the aforementioned as well as enforcement mechanisms.
DISCLAIMER: Each case depends on its own facts & merits. The above does not constitute advice; independent advice should be obtained in all instances.
By ADV LOUIS NEL, aka Louis-THE-Lawyer
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