UK Green Claims Compliance: Business Guidance
Environmental and sustainability claims are increasingly used to communicate responsible business practices. In the UK, these claims are now subject to stronger oversight and enforcement. Regulators are no longer focusing only on what companies intend, but on what they can clearly prove.
For businesses, this means that any statement suggesting environmental benefit must be accurate, specific, and supported by evidence that can be explained to customers, regulators, and investors.
The below guide covers a overview of core aspects to consider when considering your own claims:
1. What Is a “Green Claim”?
A green (or environmental) claim is any statement that suggests a product, service, or business has a positive impact on the environment or causes less harm than alternatives.
This includes:
If a customer could reasonably interpret a message as meaning “this is better for the environment,” it is treated as a green claim.
2. Who Regulates Green Claims in the UK?
Two main regulators are involved, with different but complementary roles: The CMA and The FCA.
The Competition and Markets Authority (CMA)
The CMA protects consumers from misleading business practices. It oversees consumer-facing claims, such as those found on:
The Financial Conduct Authority (FCA)
The FCA regulates financial firms and markets. Its focus is on:
3. The CMA’s Powers & the Green Claims Code
What Has Changed?
Under recent legislation, the CMA can now:
The Green Claims Code Explained
To help businesses comply with legal requirements, the CMA have issued the Green Claims Code. This guidance helps businesses communicate environmental benefits clearly and fairly.
In simple terms, the Code sets expectations for how environmental claims must be made, not just whether they are allowed.
Green Claims Code Example
❌ “Environmentally friendly packaging”
✔ “Packaging contains 80% recycled cardboard and is fully recyclable in UK kerbside collections”
Common Types of Claims Under Scrutiny
As a guide, claims such as the below will come under particular scrutiny:
A Note on Carbon Neutrality Claims
If a business says it is “carbon neutral”, it must be able to show:
Offsetting alone is increasingly seen as insufficient without real planning and consideration of emissions reductions.
4. FCA Rules on Sustainability and Greenwashing
The Anti-Greenwashing Rule (In Force Since May 2024)
All FCA-authorised firms must ensure that sustainability-related claims are:
This applies to websites, fund descriptions, reports, and marketing materials.
Anti-Greenwashing Rule Example
Calling a fund “low carbon” requires evidence that emissions are genuinely lower than comparable investments — not just expected to be lower in the future.
FCA Regulation of ESG Ratings: What’s Changing
From June 2028, companies that produce ESG ratings will be regulated. This aims to ensure:
Businesses using ESG ratings should understand what the score represents, not treat it as a guarantee of sustainability.
5. What Businesses Should Do Now
Step 1: Identify All Sustainability-Linked Communications
Systematically review all places where environmental benefits are mentioned, including:
Why this matters
Green claims often accumulate over time across teams and platforms. Language that once felt harmless or aspirational may now create legal or reputational risk. A full review helps businesses:
This step also provides clarity on where sustainability messaging is genuinely adding value versus where it may be confusing or misleading.
Step 2: Answer 3 Simple Questions
For every green claim identified, write down:
What exactly are we claiming?
What evidence do we have to support it?
Could a customer misunderstand or overestimate the benefit?
Why this matters
Many claims become risky not because they are false, but because they are too broad or undefined. Regulators assess claims based on how an average customer is likely to interpret them.
If your answers are unclear, the claim could be high risk.
Step 3: Verify the Evidence Behind Each Claim
Confirm that each claim is supported by evidence that is:
Why this matters
Under current enforcement expectations, evidence must exist before a claim is made, not in response to a challenge. Weak or unavailable evidence increases exposure to enforcement action and undermines credibility.
Additionally, having evidence readily available:
6. Why Green Compliance is an Opportunity, Not Just a Risk
It’s easy to read new rules like these and see only restrictions. But in practice, they’re doing something helpful: they’re raising the standard for everyone.
For years, businesses that invested time and money into genuine sustainability improvements have been competing with vague claims and glossy language that didn’t always reflect real action. Clearer rules help cut through that noise.
When environmental claims have to be specific and evidence-based, it becomes much easier for customers to understand what a business is actually doing; and to trust it.
This also shifts the focus internally. Instead of asking “How green can we say this is?”, teams start asking “What can we confidently explain and stand behind?” That’s a healthier question, and it often leads to better decisions.
Many organisations find that once they step back from broad claims, their sustainability story actually improves. Clearer language highlights real progress, even if it feels more modest at first. Over time, that honesty tends to resonate far more than big promises.
In short, these changes reward clarity, consistency, and follow-through. For businesses already taking sustainability seriously, that’s not a disadvantage, it’s a chance to be recognised for it.
Operating in or selling into the EU?
The EU are also tightening regulation of green claims made by businesses, with a new directive known as EmpCo coming into force during 2026.
Head to our EmpCo Compliance Guide for further detail.
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