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Europe ESG Regulatory Update on Greenwashing

Europe ESG Regulatory Update on Greenwashing

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Below is a round-up of selected updates on developments in Europe of ESG regulations and policies. Please note that this list is not comprehensive and may not include all such developments that may be relevant to your business.


  • Proposed Directive on Green Claims 

On 22 March 2023, the European Commission published a proposal for a Green Claims Directive. The proposal aims to address greenwashing by setting out requirements on how companies may promote environmental claims to consumers and introducing penalties against greenwashing. Companies would have to back their environmental claims with a comprehensive assessment. The proposal also introduces tighter rules for the approval of new environmental labels.

On 3 May 2023 the Council adopted its negotiating position on the proposed Green Claims Directive. The Council also proposed extending the implementation period from 18 months to 24.
Next Steps: The negotiations between the Council and the European Parliament are to begin as soon as the Parliament adopts its position.

On 1 June 2023, the ESAs published their progress Reports on greenwashing in the financial sector. In these Reports, the ESAs put forward a common high-level understanding of greenwashing applicable to market participants across their respective remits; financial markets, banking, and insurance and pensions. 

We will provide you with more information on greenwashing in the coming weeks.

Consumer related laws:

  • As part of the New Consumer Agenda and the Circular Economy Action Plan 2020, and with the aim to better inform consumers and protect them against unfair commercial practices, the Commission tabled its ‘Empowering the Consumer for the Green Transition’ initiative, which amends two existing directives: the Unfair Commercial Practices Directive and the Consumer Rights Directive. The amendment to the CRD would oblige traders to provide consumers with more detailed information on products’ durability and reparability. The proposed Ecodesign Regulation link: includes a proposal for the new “digital product passport” which will display information about a given product’s environmental sustainability to help consumers make more informed choices. The law sets a broad framework for future product standards to be adopted, mandating that products to be offered on the EU’s internal market must be energy-efficient, durable, repairable, reusable and recyclable.
  • On 1 June 1 2023, the European Parliament adopted recommendations for the EU strategy for sustainable and circular textiles. The text calls for textile products sold in the EU to be more durable, easier to reuse, repair and recycle. Their production should respect human, social and labor rights, the environment and animal welfare throughout the supply chain. The European Parliament wants EU and national measures in place to put an end to “fast fashion”.

By Prof. Dr. Birgit Spiesshofer, ESG and Sustainability Practice Lawyer, and Dasa Vukelic, Europe Chief Sustainability and Governance Counsel, Dentons

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