Greenwashing Risk

Navigating the legal risks in your sustainability efforts

With the increased scrutiny of ESG credentials from regulators, investors and consumers, the demands for businesses to make the significant steps towards eco-friendliness also heightens the risk of financial and reputational damage if this is not performed accurately.

Recently, a rising number of businesses are getting caught up in perceived greenwashing scandals - the accidental or deliberate misleading of third parties in relation to a company's environmental credentials – when communicating sustainability-related products, services and achievements.

In 2024, the associated risk of greenwashing will be supercharged as the UK's Competition and Markets Authority may soon have the power to decide if businesses' sustainability claims are misleading and could impose unprecedented fines as a result of breaches.

At the same time, the risk of private claims by shareholders and investors for alleged corporate greenwashing has never been higher.

Our Services

At Stephenson Harwood, we bring together market-leading experts that have expertise in all aspects of Greenwashing Risk, including regulatory compliance, civil fraud, commercial and corporate litigation, competition and consumer protection. We provide comprehensive legal solutions to help you make fully informed decisions in relation to your sustainability efforts, identify and mitigate any risks, and ensure you stay ahead of the curve in a rapidly changing landscape. We are well placed to advise in every major industry and sector, with clients ranging from multinational corporations, financial institutions, large and medium sized companies, and professionals.

Our team is international with specialists spread across our offices in Europe, Asia, and the Middle East, which means that we can support you wherever your business interests are based.

Our specialists advise clients on all aspects of Greenwashing Risk:

Transactional & Advisory, including assisting clients with:
- marketing and environmental advertising campaigns
- corporate sustainability disclosure statements
- contractual mitigation strategies
- sustainable finance and anti-greenwashing regulations
Litigation, where we frequently act for both claimants and defendants in misrepresentation claims, class actions and corporate and commercial disputes, particularly in relation to the enforcement of regulatory standards including in the environmental context.
Investigations, dealing with contentious regulatory matters, criminal investigations, enquiries and information requests from regulators and authorities, including the Financial Conduct Authority, the Competition and Markets Authority, the Serious Fraud Office, and the Advertising Standards Authority.

We have particular experience advising on Greenwashing Risk in the Transportation and Trade industries, including Aviation, Shipping, Commodities and Renewables.

Case Studies

Advising a major European airline in respect of allegations by the Advertising Standards Agency that certain environmental claims made as part of its print and media advertising claims were misleading and unsubstantiated.
Representing an investment manager in relation to investor claims arising out of investments in carbon-intensive assets.
Advising a UK impact listed investment trust on their EU Sustainable Finance Disclosure Regulation (SFDR) reporting and disclosure obligations.
Advising a UK listed financial services provider on their Task Force on Climate-related Financial Disclosures (TCFD) obligations under the FCA Listing rules.
Advising a UK listed investment trust on adopting a sustainability label under the UK Sustainability Disclosure Requirements (SDR) and product labelling regime.
Advising several UK investment management firms on the UK Sustainability Disclosure Requirements (SDR) and product labelling regime.
Assistance in the assessment of regulator complaints of alleged greenwashing relating to energy suppliers' green energy offer.
Advising an Australian children’s clothing brand on the labelling of products and notably the possibility to include the term “organic cotton” on the label”.