As competition for consumer preference grows, the need for distinctive cosmetics packaging becomes ever more critical. One increasingly common way brand owners and private label retailers are attempting to set their offerings apart is by touting their environmental attributes on their packaging - from "all natural" and "green" text and markings to "biodegradable" or "recyclable" labels. But not all claims on the market today are allowed.

FTC Rules Rule

To ensure environmental marketing is truthful and substantiated so consumers aren’t misled, the Federal Trade Commission (FTC) governs use of environmental claims through the agency’s Guides for the Use of Environmental Marketing Claims, commonly referred to as the "Green Guides.”

Most recently updated in 2012, the Guides provide guidelines for several self-declared environmental claims, including three of the most common types: general environmental benefit, recyclable and degradability.

• GENERAL ENVIRONMENTAL BENEFIT CLAIMS

For marketers to use unqualified claims like “eco-friendly” or “green” or an image that conveys environmental benefits or little negative environmental impact, they must be able to substantiate all reasonable interpretations consumers could make about the claims. In reality, it’s unlikely they can, so the FTC recommends not making unqualified general environmental benefit claims.

On the other hand, claims like “eco-friendly” are okay as long as additional, prominent language limits the claim to a specific benefit(s), it is not otherwise deceptive, and the marketer can substantiate the touted attribute provides a net environmental benefit overall. For example, the claim “Eco-friendly: made with 50% recycled materials” would be acceptable if the recycled content level can be substantiated and makes the product more environmentally beneficial.

• RECYCLABLE

A company’s ability to use recyclable claims depends on the availability of recycling facilities where an item is sold or marketed. The following tiered analysis determines whether a recyclable claim needs to be qualified and the type of qualifying text needed.

1. If recycling programs for the packaging are available to a “substantial majority” (60% or more) of consumers or communities where it is sold, then no qualifying text is required.

2. If recycling programs are available to less than a substantial majority (less than 60%), then marketers should qualify the claim based on the level of access consumers have to recycling facilities.

For example:

a. Slightly less than a substantial majority. Use a qualifying statement like, “This package may not be recyclable in your area” or “Recycling facilities for this package may not exist in your area.”

b. Available to only a few consumers. Use a qualifying statement such ass, “This package is recyclable only in the few communities that have appropriate recycling facilities.”

A company could also include text on the actual number of communities with appropriate programs, or the percentage of the population with access to programs, to adequately qualify a claim.

Additional things to consider when making recyclable claims include:

If a package has both recyclable and non-recyclable components, the recyclable claim should be adequately qualified to avoid consumer deception about which portions of the package is recyclable.

Under FTC Guidelines, the use of the Möbius Loop (three chasing arrow symbol) alone, without qualifying text, constitutes a claim that the packaging and product are made of 100% recycled materials and are universally recyclable.

• DEGRADABLE CLAIMS

Consumer concerns that some packaging waste will remain in the landfill indefinitely have prompted increasing number of claims of degradability in recent years. But they’re likely deceptive.

That’s because it is very difficult to make adequately qualified degradable, biodegradable, oxo-degradable, oxo-biodegradable, or photodegradable claims for packaging.

And it is deceptive to make an unqualified degradable claim for items entering the solid waste stream if they cannot completely “decompose into elements found in nature within a reasonably short period of time after customary disposal.”

The FTC describes a short period of time as one year after customary disposal. Since most packaging ends up in landfills, incinerators and recycling facilities, which do not provide conditions where packaging can completely decompose within one year, an unqualified claim must be backed by competent and reliable scientific evidence.

To avoid deception, the FTC Guides state that degradable claims should be accompanied by clear and prominent language describing the package’s ability to degrade in the environment where it is customarily disposed and the rate and extent of degradation. But, since today’s landfills are not designed to facilitate degradability, companies should be very careful when using any claim of degradability.

It’s Not Easy Being Green

With the continued drive to make packaging stand out, brand owners are stepping up their use of innovative materials and designs. And since consumer preference for packaging that has less environmental impact is increasing, companies are getting savvier about communicating the sustainable attributes of their systems to address these changing buying habits and attract – and keep – today’s consumers.

But to be in compliance, they need to know what they can – or must – say to avoid consumer deception. Following are several examples, based on the Green Guides, of acceptable and unacceptable claims cosmetics companies have used, with explanations on their appropriateness.

Sunscreen labeled “Earth-Friendly Packaging.” This is a clear general environmental benefit claim. It is deceptive since consumers are likely to interpret the claim to mean that the packaging does not have any environmental impact at all. Since no environmental attributes about the package are provided, there is no way this claim can be substantiated by claiming a specific attribute provides a net environmental benefit.

Lip balm labeled ‘‘Greener than our previous packaging.’’While the packaging weighs 15% less than the previous version, it’s not recyclable nor has it been improved in any other material respect. The claim is deceptive because reasonable consumers likely would interpret ‘‘Greener’’ in this context to mean that other significant environmental aspects of the packaging were also are improved.

Shampoo labeled ‘‘Environmentally-friendly improvement.25% less plastic than our previous packaging.’’ The plastic shampoo bottles are 25 percent lighter but otherwise are no different. The advertisement conveys the bottles are more environmentally beneficial overall because of the source reduction. To substantiate the claim, the marketer can likely analyze the impacts of the source reduction without evaluating environmental impacts throughout the packaging’s life cycle. If, however, manufacturing the new bottles significantly alters environmental attributes earlier or later in the bottles’ life cycle, i.e., manufacturing the bottles requires more energy or a different kind of plastic, then a more comprehensive analysis may be appropriate.

Body wash advertised as ‘‘Biodegradable’’ (without qualification). In the advertisement, the marketer makes clear that only the body wash, and not the bottle, is biodegradable. The marketer has competent and reliable scientific evidence demonstrating that the body wash, which is customarily disposed in sewage systems, will break down and decompose into elements found in nature in a reasonably short period of time in the sewage system environment. Therefore, the claim is not deceptive.

Compact is labeled “Recyclable” (without qualification). It is unclear from the type of product and other context whether the claim refers to the product or its package. The unqualified claim likely conveys that both the product and all of its packaging, except for minor, incidental components, can be recycled. Unless the manufacturer has substantiation for both messages, it should clearly and prominently qualify the claim to indicate which portions are recyclable.

Perfume paperboard package is labeled ‘‘Made From Recycled Materials.’’Unless the paperboard is made from 100% recycled material, this claim would be deceptive. If the paperboard is not made from 100% recycled material, the amount (percentage) must be stated. Both pre- and post-consumer recycled content can be included in this total, or the claim can state the percentage of each (e.g. Made from 50% recycled material, 25% of which is post-consumer.).

Cracking Down on Claims

The FTC can take enforcement action against deceptive claims, which can lead to fines if orders prohibiting future deceptive advertising are violated. And while such steps were few and far between in the first two decades after their initial publication, since the updated Guides were released in 2012, the agency has stepped up enforcement.

In 2013, the agency announced actions against five companies for making deceptive claims for biodegradable plastics. The orders require that, to be in compliance with the Guides, the companies can’t make biodegradability claims unless they’re true and supported by evidence that that the entire plastic product will completely decompose into elements found in nature within one year after customary disposal (defined as disposal in a landfill, incinerator, or recycling facility).

As more brand owners respond to consumers’ environmental preferences with packaging claims, these latest moves by the FTC for false statements are likely just the beginning. And it’s not just consumers or government backlash companies need to worry about when stating their “green” attributes. Competitors can file complaints as well. In 2009, Dr. Bronner’s Magic Soaps filed suit against several personal care brands for allegedly mislabeling products as “organic.” While the lawsuit addressed product and not packaging claims, competitors could take the same approach to package labels if they worry inappropriate statements are negatively impacting their market share.

Put a Process in Place

A lot of packaging has environmental attributes that are important to communicate from both a corporate perspective and the consumer’s point of view. Whether brand owners want to track their progress over time towards environmental goals, improve their corporate social responsibility profile or simply garner a larger share of buyers, the desire to boast benefits shows no sign of slowing down. How does a company ensure what it claims is appropriate? A corporate policy for environmental labeling is key and should address the following:

Identify what is important to your costumers. Most consumers want to read something actionable, namely, what to do with the packaging after they finish with it. So it may make sense to focus on recyability claims that convey whether the packaging can be recycled in a community recycling program or whether a customer can bring the packaging back to the retailer. The Sustainable Packaging Coalition’s How2Recycle label is one way to show the availability of recycling options for each component of the packaging.

Be sure you understand what you can and cannot claim – and communicate that to your packaging designers and marketers.

Stay away from claims that are irrelevant.For example, if you include on your label that the packaging is compostable, but there are no facilities available to consumers for composting, your policy should forbid its use.

Make sure you have the required supporting data and documentation to support all of your claims.

ABOUT THE AUTHOR: Victor Bell is president of Environmental Packaging International (EPI), a consultancy specializing in global environmental packaging and product stewardship requirements. More info: www.enviro-pac.com.