How to Avoid Greenwashing: Current Legislation, Best Practices, and Real-World Examples
Posted By on Apr 18th 2025
by Saloni Doshi • published April 18, 2025 • 9 min read
Greenwashing is a growing concern among eco-conscious businesses and customers alike.
While sustainability often sells, greenwashing has the potential to backfire. Misleading claims can erode customer trust, damage brand reputation, and even result in legal consequences.
Fortunately, there are steps businesses of any size can take to avoid potential greenwashing issues and share their sustainability efforts thoughtfully and meaningfully.
This guide provides a comprehensive overview of greenwashing laws, practical strategies, and a case study on how brands can build credibility through transparency and intentional action.
Read on for actionable tips, and if you’re interested in auditing your packaging for greenwashing risks or refreshing your strategy to better convey your impact goals, reach out to us. We’ll be happy to help you get started.
The Nuance of “Greenwashing,” Intentional and Unintentional
We recognize that the term greenwashing comes with a lot of baggage — and, unfortunately, it’s often weaponized in ways that actually hinder meaningful progress.
Many brands are genuinely trying to improve. They're investing time, energy, and resources into becoming more sustainable, and understandably, they want to share those efforts with their customers. But when brands promote their progress, they open themselves up to scrutiny.
Even when their intentions are good, brands can be met with criticism for not doing enough or for doing it imperfectly. That kind of backlash, sometimes warranted and sometimes undeserved, can be counterproductive. It can discourage transparency and lead to something just as concerning: greenwashing.
When companies go silent out of fear of being called out, it slows the entire movement. Fewer stories get told, fewer lessons are shared, and often, fewer investments are made in the first place. If no one can talk about their sustainability work without fear of being publicly shamed, the incentive to take risks or try new approaches diminishes.
It’s a tricky balance, and this guide aims to help brands that are committed to making and sharing progress in sustainability navigate that journey.
We want to support companies in making thoughtful impact goals and then talking about them clearly, honestly, and confidently. When brands communicate their efforts transparently and with integrity, they not only build trust but also help shift the broader conversation away from fear, perfectionism, or frustration and toward hope, progress, and community action.
What Is Considered “Greenwashing”?
While the term “greenwashing” is thrown around pretty aggressively - often in situations that don’t warrant it - the word is generally used when companies misrepresent their environmental impact, either through vague claims, inaccurate marketing, or sustainability efforts that fall much shorter than the claims being made. Some common examples include:
- Vague or misleading language. Using terms like “eco-friendly” or “natural” without clear definitions or supporting data.
- “Green” design. Using colors, symbols, or words on packaging to make it appear like a more sustainable product than it really is.
- False certifications. Creating in-house eco-labels that mimic third-party verifications.
- Omitting critical information. Highlighting one green feature and using that one advantage to deem something “sustainable.”
- Overstating sustainability efforts. Making bold claims about carbon neutrality without third-party verification, data, or clear reduction strategies.
- Highlighting progress without addressing limitations. Sharing efforts that neglect or understate potential challenges or limitations. For example, launching “recyclable” packaging that is not truly recyclable under current infrastructure in the short term.
Regulations are evolving to combat these types of greenwashing, requiring businesses to be more precise and truthful in their environmental claims.
While these emerging requirements can add a layer of complexity for businesses, most anti-greenwashing legislation is a win for consumers and the environment.
Why Is Greenwashing a Problem?
Greenwashing - whether intentional or unintentional by a brand - can be a serious issue:
Damage to Reputation and Consumer Trust
Consumers are becoming more discerning, and greenwashing scandals can quickly lead to public backlash.
Once a company is exposed for making misleading claims, it can be difficult to regain customer trust. Negative press, social media criticism, and word-of-mouth damage can have long-term consequences for brand loyalty.
Legal and Financial Risks
With increasing regulations, greenwashing can result in lawsuits, fines, and penalties. Many governments worldwide are cracking down on false environmental marketing.
Non-compliance with laws like the FTC’s Green Guides or California’s Environmental Marketing Claims Law can create a significant headache for businesses owners, and may even lead to costly legal proceedings or steep fines.
Hindered Progress
When companies engage in greenwashing, they divert resources, energy, and attention from genuine sustainability efforts.
Instead of investing in real environmental impact, businesses may focus on marketing tactics that provide the illusion of sustainability without tangible results. This delays meaningful progress, leads to missed opportunities to do good, and undermines trust in sustainability initiatives overall.
With the potential for these far-reaching negative effects, it’s no surprise that greenwashing has shown up in recent legislation - both within the United States and internationally.
Current Greenwashing Legislation to Consider
Below, you’ll find an at-a-glance overview of current legislation that applies specifically to greenwashing. Besides these targeted guidelines, there are also broader sustainability laws that also influence how companies market their sustainability efforts.
For example, Extended Producer Responsibility (EPR) laws require companies to take responsibility for the environmental impact of their products, including disposal and recycling. Several states, including Maine, Oregon, and California, have implemented EPR policies to ensure brands play a direct role in reducing packaging waste.
Staying informed on these developing legal requirements is key to avoiding greenwashing. Explore current EPR legislation and other packaging compliance topics in our helpful guide.
FTC’s Green Guides
The FTC’s Green Guides aim to encourage brands to make clear and accurate environmental claims. These guidelines emphasize:
- Clarity in wording. Avoid vague terms like “green” without context.
- Scientific backing. Claims must have reliable scientific evidence.
- End-of-life transparency. If a product is labeled “recyclable,” it must actually be widely accepted in curbside programs.
These guidelines have been recently updated and are a foundational piece of legislation for brands selling within the United States.
California’s Environmental Marketing Claims Law
Passed in early 2025, California’s Environmental Marketing Claims Law strengthens existing regulations by requiring:
- Proof of environmental claims with third-party verification.
- Clear definitions of terms like “biodegradable” and “compostable.”
- Severe penalties for false or exaggerated claims.
Since this law is relatively recent, it may take time to see how these requirements will be implemented and enforced - as well as whether other state legislatures will follow suit.
California’s Truth in Labeling
California’s Truth In Labeling Act restricts misleading end-of-life labeling, particularly for plastics, and aims to help customers understand the proper way to dispose of packaging after use.
Under this acts, companies selling in California must meet requirements like:
- Refrain from misleading or inaccurate use of words like “recyclable,” “biodegradable,” or “compostable”
- Avoid using the chasing arrows recycling symbol unless the product is considered widely recyclable
- Ensure compostable products meet ASTM D6400 standards
CalRecycle provides education about recycling and labeling in the state, and is a helpful resource if your brand is navigating the nuances of selling in California.
Colorado’s Standards For Products Represented As Compostable
Colorado’s SB23-253 focuses on compostable products, aiming to eliminate confusion for customers and prevent contamination of composting streams.
These standards mandate:
- Clear labeling for compostable products.
- Certification from an approved third party.
- Penalty fines for brands that represent non-compostable items as compostable
As bio-based plastics continue to flood the market, regulation focused on compostable products will likely continue to expand.
Legislation Outside the United States
Canada’s Competition Act. Strengthened in 2023, this law requires businesses to provide verifiable evidence for any environmental claims, with penalties for misleading marketing.
EU’s Green Claims Directive. Expected to take effect in 2025, this directive will ban vague eco-friendly claims unless backed by scientific evidence and third-party verification.
Best Practices to Help Your Brand Avoid Greenwashing
Avoiding greenwashing, whether intentional or unintentional, is a smart move for any brand. Here are some standards you can use to evaluate your current efforts, as well as ensure your future marketing aligns with best practices.
Use Clear and Accurate Language
Consumers value transparency.
Instead of vague buzzwords, use concrete language that clearly defines your sustainability efforts. For example, rather than saying “eco-friendly packaging,” specify “100% post-consumer recycled material.”
Providing evidence and clear definitions helps maintain trust, and makes it easier for customers to support your brand with confidence.
Include Specific End-of-Life Guidance for Packaging
Customers need clear instructions on how to dispose of packaging.
You can ensure that your on-pack instructions are accurate and easy to understand. Where appropriate, certifications like How2Recycle® can also provide standardized, recognizable recycling guidance. Educating customers on end-of-life disposal helps prevent contamination of recycling and composting streams and keeps usable materials out of the landfill.
Be Authentic and Transparent
One of the most effective ways to avoid greenwashing — and build long-term trust — is to lead with honesty. That means sharing not only what you're doing well, but also where you're still working to improve. Consumers today are increasingly aware of sustainability issues, and while they don’t expect perfection, they do value clarity and intention.
For example, if you’ve chosen to use 100% recycled plastic in your packaging, say so — and explain why this is the material you’ve chosen.
In this case, you can acknowledge the stigma around plastic, then walk customers through your reasoning, such as:
- Keeping material in circulation
- Reducing the need for virgin inputs
- Lowering your carbon and transportation footprint
- Aligning with current supply chain or operational needs
If you’re working toward finding a next-gen material or plastic alternative that meets your needs, share that too. This type of transparency not only helps inform your audience, it also reinforces that your sustainability strategy is thoughtful rather than performative.
On the other hand, if you’ve already made a leap forward in sustainability, share your progress and also be open about imperfections.
For example, you may be piloting an innovative material that hasn’t been fully stress tested yet, implementing a takeback program that still needs refining, or are pursuing certifications or verifications that are still pending. As you take steps toward greater circularity, invite your customers into the journey.
By being clear about both your progress and your challenges, you're showing that sustainability is a process, not a checkbox, which helps you build trust, engagement, and loyalty.
Publish and Regularly Update Your Impact Goals
A public commitment to sustainability keeps your brand accountable.
Develop clear environmental goals, such as reducing plastic waste or increasing recycled content in packaging.
Regular updates on both your progress and the challenges you’ve come up against - such as through publicly available annual reports - can demonstrate your brand’s authentic commitment to making a difference.
Pursue Third-Party Certification or Verification When Needed
Where appropriate, pursuing third party certifications can add trusted credibility to your claims. Relevant and reliable third-party certifications include:
- FSC® Certified. Ensures responsible forestry practices for paper products.
- Cradle to Cradle Certified®. Evaluates product sustainability across multiple categories.
- How2Recycle® Label. Provides standardized disposal instructions for consumers.
In our Guide to Sustainable Certifications, we break down some of the most common sustainability verifications you may pursue, as well as how to know if they are an effective choice for your brand.
Audit and Disclose Supply Chain and Carbon Emissions Data
Sustainability extends beyond marketing - it requires actual changes and consistent effort.
Conducting supply chain audits helps verify sustainable sourcing, and reporting emissions data through standards like the Carbon Disclosure Project (CDP) increases transparency.
If reducing or offsetting carbon emissions is your goal, we encourage you to do so thoughtfully, avoiding the widespread but often ineffective method of defaulting to only using tree planting initiatives.
Instead, take a measured and holistic approach to understanding your brand’s impact and choose a carbon management strategy that best aligns with your overall mission.
Design Packaging Thoughtfully
Packaging choices matter, and your packaging is one of the most visible ways you can share your commitment to the planet.
Some steps you may take as you create thoughtful packaging include:
- Prioritize materials with high recycled content
- Audit your plastic use
- Reduce unnecessary material use
- Optimize for ready recyclability
- Take a leap on innovative materials
- Use your designs to engage customers in your mission
Whether you’re ready to embark on a full custom branding product or simply need to refresh what you’re already doing, EcoEnclose is here to help.
We have reviewed some of the foundational measures you can take to ensure your brand stays away from potential greenwashing issues, and you can adapt them to your brand’s size and needs.
Now, let’s take a look at a spotlight of a brand that consistently gets sustainability and eco-marketing right!
Transparency Spotlight: Ritual
Ritual is a vitamin and supplement brand that has gained recognition for its deep commitment to transparency and sustainability. Unlike many companies in the wellness industry that rely on vague claims, Ritual has built trust through open communication about its ingredient sourcing, supply chain, and packaging choices.
Industry-Leading Transparency
The Made Traceable initiative is at the heart of Ritual’s approach to business and wellness.
The Made Traceable initiative provides detailed sourcing information for every ingredient, including its supplier, country of origin, and reason for inclusion.
This level of transparency helps consumers make informed decisions and sets a high standard for the industry.
Commitment to Customer Trust
One of Ritual’s core values is trust.
The company prioritizes science-backed formulations, clear labeling, and honest marketing.
Ritual actively educates consumers on the sourcing and benefits of its ingredients through its website, product pages, and sustainability reports, fostering a deeper connection with its audience.
Clear Goals & Measured Progress
(Source page 9)
Ritual publicly shares its sustainability commitments, tracking progress through detailed reports.
The company sets measurable goals for ingredient sourcing, carbon footprint reduction, and packaging improvements, ensuring continuous accountability.
Intentional Packaging Choices
Ritual’s packaging choices align with its sustainability goals.
The company prioritizes recycled and recyclable materials while minimizing unnecessary waste. By using FSC® Certified paper and recycled plastics, eliminating unneeded materials, and sharing inspiring messages with their designs, Ritual ensures that its packaging meets high standards.
Your Brand Can Be a Leader
Avoiding the risk of being critiqued as greenwashing requires more than just good intentions - it demands transparency, accountability, and a commitment to consistent action.
Businesses that prioritize clear communication, verifiable claims, and meaningful sustainability initiatives can build stronger consumer trust and make a lasting impact - as well as avoid the potential headaches and backlash that come with violating anti-greenwashing laws.
To learn more about sustainability legislation, check out our Guide to Extended Producer Responsibility. Or, if you’re looking to refresh or start fresh with your sustainable packaging strategy, reach out to us and we’ll be happy to help.
About EcoEnclose
EcoEnclose is the leading sustainable packaging company that provides eco-packaging solutions to the world’s most forward-thinking brands.
We develop diverse, sustainable packaging solutions that meet our rigorous research-based standards and customers’ goals. We drive innovative packaging materials to market and consistently improve the circularity of existing solutions.