Scrutiny over greenwashing is intensifying, and the companies that don’t get it right now face legal repercussions in the EU. In this article, Sam Webster, director of growth & innovation at HowGood, argues that consumer trust now depends on transparent, visible on-pack data backed by science.
Products packaged as “climate-friendly” are facing heightened levels of scrutiny after last year prompted a spike in greenwashing litigation, particularly against major food & beverage providers.
As a result, these companies were forced to walk back certain claims, governments around the world are strengthening regulations with regard to what qualifies a sustainable product, and consumers—most of whom consider sustainability in their purchasing decisions—are thinking twice about how transparent brands really are about environmental responsibility.
Still, climate-labeled products play a key role in fostering consumer trust. Aside from consumer willingness to pay more for sustainable products, climate labels are an avenue for environmental accountability and transparent communication with purchasers when used responsibly.
As greenwashing accusations rise, the question for CPGs isn’t whether to implement climate labels – it’s how they can substantiate these claims with granular data to boost consumer confidence and restore trust in a brand.
Authentic climate-friendly labels rely on product-level data, or ingredient-level data when specific to the food and beverage industry. These sustainability insights can be hard to gather, but challenges can be overcome through close supply chain collaboration and third-party verification to ensure the label reflects reality.
Getting granular with climate labeling
When you’re shopping for eggs, labels like “cage free,” “organic,” and “farm fresh” have minimal impact when consumers lack understanding about how these claims are substantiated, or trust in the brand that the product’s footprint is being calculated accurately. With skepticism toward “eco-friendly” products rising, a need for clear consumer education and accurate footprinting data is more critical than ever.
Granular, supplier-provided data achieves exactly this, setting a strong foundation for the legitimacy of a climate-friendly product. These insights span details like how the supplier is sourcing each ingredient, what agricultural practices are being used in the growing of those ingredients, and what sort of energy inputs are required in processing. All of this is critical data for producing an accurate carbon footprint claim.
The problem: gathering this level of detail involves precise measurement of indirect factors, which can be difficult to track across a company’s entire supply chain, as the necessary data points lie largely with external partners rather than the brand.
Supply chains: Gatekeepers to verified climate labels
Collecting product-level insights is a strenuous process riddled with limited control over the insights obtained, lack of data infrastructure, and varying levels of data maturity among suppliers.
The good news: stronger supplier engagement with streamlined footprinting tools can mitigate most of these challenges. By developing data-sharing plans with suppliers that capture the data necessary for footprinting, while still protecting the supplier’s proprietary recipes, can be a win for both sides.
Substantiating climate claims with third-party verification
It’s always important to do your research, and most consumers always do this for brands and products before purchase. With any piece of firsthand information, verifying through multiple external sources is critical to authentication, hence the importance of third-party verification for any product deemed sustainable.
Third-party verification isn’t only important to maintain environmental transparency and trust from shoppers – it also enhances the credibility of the primary data collected from the supply chain, reducing risks for greenwashing litigation and ensuring regulatory resilience as climate reporting guardrails continue to shift.
Partnering with accredited organizations and certification bodies such as the Carbon Trust to vet data ensures these insights are compliant and align with the latest labeling frameworks. By combining collaboration with these bodies with continuous data collection from suppliers, brands can confidently issue labels that are actually backed by science.
Conclusion
Tagging a product as “climate-friendly” is only one piece of the puzzle. Now, brands need to prioritize fortifying their data-gathering process so they can substantially prove these claims are legitimate and show their work to consumers.
Consumer skepticism toward eco-friendly products shouldn’t be seen as a hurdle. Rather, this is a major opportunity for brands to prove themselves as trustworthy by providing palpable, science-backed information on every package.
Before brands put another sustainable product on the market, it is vital for them to ensure collaboration with suppliers to overcome product-level data collection challenges. This creates a reliable, foolproof system to develop true carbon transparency and provide shoppers with the information they need to feel confident in their purchases.
While this high-fidelity data also serves as the necessary foundation for future decarbonization efforts, its immediate value lies in the restoration of brand integrity through the humble product label.
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