Time to walk the talk: sustainability claims under the microscope

With the Empowering Consumers for the Green Transition Directive (EmpCo), the European Union aims to better protect consumers against misleading sustainability communication. For businesses, this represents a clear shift in direction. Whereas sustainability claims today are sometimes broadly formulated or commercially driven, the focus will now be on one key question: Can you prove what you communicate?

Not new, but stricter

The prohibition of misleading communication is not changing. What is changing is the standard companies must meet to substantiate sustainability claims. There is less room for interpretation, while expectations regarding transparency, documentation, and evidence are increasing.

From ambition to evidence-based communication

Consumers are currently inundated with terms such as eco-friendly, carbon neutral, and zero impact. In many cases, it is unclear what these terms actually mean or what they are based on. The European Union wants to put an end to this and improve the reliability of sustainability information.

The directive therefore explicitly targets misleading or unclear sustainability communication and addresses several practices.

1. No more vague environmental claims

General terms such as environmentally friendly or sustainable product will only be permitted if they are clearly defined and supported by verifiable evidence.

2. No more incomplete or exaggerated claims

This includes situations where:

• an entire product is presented as sustainable while only one component or characteristic is actually sustainable;

• legally required minimum standards are presented as an additional voluntary effort;

• products are marketed as climate neutral solely on the basis of carbon offsetting. From now on, only emission reductions achieved within the company's own value chain will count.

3. No more misleading labels

Self-developed sustainability labels without independent verification or certification will no longer be permitted.

4. No more unfair comparisons

Comparisons with other products must be objective, transparent, and verifiable.

5. No more irrelevant sustainability claims

Even factually correct claims can be problematic if they do not provide meaningful information for assessing the sustainability of a product or service.

6. Transparency about product lifespan and circularity

Companies may no longer mislead consumers about a product's lifespan, repairability, or repair costs. Products deliberately designed with a limited lifespan may no longer be promoted.

What does this mean in practice for businesses?

The message is straightforward: sustainability claims must be based on reliable and verifiable information.

That requires more than good intentions. Claims must be supported by accurate data, clearly documented assumptions, and (for carbon-related claims) a credible emissions reduction strategy. As a result, sustainability communication becomes a shared responsibility of marketing, sustainability, finance, legal, and compliance teams.

At the same time, sustainability communication is evolving into a fully-fledged risk management area. Insufficiently substantiated claims can lead to complaints, regulatory investigations, and reputational damage.

Not just a risk of fines, but also of reputational damage

The potential penalties are substantial. Member States may impose fines of at least 4% of a company's annual turnover.

Equally important is the impact on the trust of customers, investors, and other stakeholders. Sustainability claims that later have to be withdrawn or amended can quickly undermine a company's credibility. And that trust is becoming an increasingly decisive factor in a market where sustainability is a key differentiator.

How can Vandelanotte support you?

What initially appears to be a communication challenge also concerns data quality, internal controls, and governance. Vandelanotte helps companies translate the new directive into a practical, audit-ready approach.

We support you by:

• critically reviewing existing sustainability claims;

• identifying greenwashing risks;

• strengthening the underlying data and documentation;

• developing a clear and compliant sustainability communication policy.

This enables your organization not only to comply with the new legislation, but also to build credible sustainability communication that strengthens the trust of customers and other stakeholders.