The EU green claims initiative and what it means for your business

On March 22, the Commission presented an EU green claims initiative on common criteria for combating greenwashing and misleading environmental claims. It complements the Commission's proposals from last year (March 30, 2022) on amending the directive on unfair business practices.

The goal is to make the sustainability claims made by companies verifiable, comparable and reliable, and thereby tackle greenwashing.

Is your company affected my the EU green claims initiative?

The scope of application is not 100 % clear yet. According to the Commission's proposal, companies would need to adhere to minimum standards when making environmental claims (green claims) about their products or services. Before including an environmental claim in their consumer information, these claims would need to be substantiated based on scientific evidence. Except for micro-enterprises (with fewer than 10 employees and turnover or balance sheet total below 2 million euros), traders would also need to have these claims verified by an accredited organization.

What will change for you with the EU green claims initiative?

All companies making any green claims will have to substantiate them using the PEF methodology. The PEF is a method to measure the environmental performance of a product or an organization throughout the value chain, from the source to the end of life. Specifically, it is based on Life-Cycle Assessments and looks at 16 environmental impact categories.

By making the PEF the standard methodology for Life-Cycle Assessments in the European Union, the European Commission for the first time creates a legislative standard for all companies. It has not yet been decided whether businesses will have to add a label indicating whether their product is certified as PEF-compliant.

What are the special challenges?

Life-Cycle Assessments are extremely complex undertakings because they require a very detailed look at every step of a product’s journey.

This means you will have to understand:

• the environmental performance of all of your products' parts that you purchase from suppliers
• and the environmental impact of your products after they were sold and until they are disposed off.

In addition, PEF assessments can become quite expensive because of the comprehensive processes required to conduct them.

How we help you

Together with experts from large, medium-sized and small companies with experience in sustainability reporting, we provide software solutions that makes it easier for you to operationalise the legislative requirements.

• We simplify the collection of relevant data internally and along the whole supply chain, increasing efficiency and reducing effort.
• We help your suppliers oblige your information requests but allow them to protect business-critical information about their supply chain from being exposed to the data receiver at the same time, only showing one level up and one level down.
• We explain the new standards in a hastily way and help with the calculations. In this way, we relieve you of tedious work steps and simplify data entry.
• We facilitate data exchange with suppliers and ensure that necessary information from the supply chain arrives correctly and without additional effort.
• We can help you generate PEF-compliant LCAs at the touch of a few buttons once the data has been entered.