H&M is Being Sued For “Misleading” Sustainability Marketing. What Does This Mean for the Future of Greenwashing? — The Sustainable Fashion Forum (2024)

H&M is being sued for '“false” and “misleading” sustainability marketing. In a class-action lawsuit filed on July 22nd, Plaintiff Chelsea Commodore, a New York state resident, alleges that despite its position as a fast-fashion giant, H&M is deceptively capitalizing on the growing segment ofconscious consumersby creating an extensive marketing scheme togreenwash its products and present them as environmentally friendly when they are not.

Commodore alleges that among other things, H&M's sustainability labeling, marketing, and advertising is “designed to mislead consumers through the use of false environmental sustainability profiles. In addition to these profiles, the lawsuit alleges that H&M makes various misrepresentations regarding the sustainable nature of its products, including H&M's ability to close-the-loop and prevent textiles from going to the landfill through its recycling program.

According to the lawsuit, H&M’s created illusion “that old clothes are simply turned into new garments, or that clothes will not end up in a landfill” is misleading, adding that “recycling solutions either do not exist or are not commercially available at scale for the vast majority" of H&M's products. Even still, Commodore argues, “it would take H&M more than a decade to recycle what it sells in a matter of days.

On the heels of the H&M lawsuit, UK watchdog, Competition and Markets Authority (CMA) announced on July 29th that it would investigate Asos, Boohoo, and other fashion brands over claims about the sustainable nature of their products. “Should we find these companies are using misleading eco claims, we won't hesitate to take enforcement action – through the courts if necessary,” said CMA interim Chief Executive Sarah Cardell in a statement. “This is just the start of our work in this sector, and all fashion companies should take note: look at your own practices and make sure they are in line with the law,” she added.

As the global climate crisis continues to mount and consumers increasingly want to align their purchases with their values, brands are responding by making sustainability commitments, setting climate goals, and vowing to minimize their environmental impact. However, as customer interest in fashion's footprint has increased, so has greenwashing — falsified and/or misleading messages that deceive the public and bury the reality of a brand's sustainability efforts concerning their product, service, or policies.

Vague buzzwords, narrowly focused cherry-picked goals, nonexistent timelines, and green claims unsupported by credible data plague the fashion industry. Without a universally agreed-upon definition of sustainability or an established benchmark for even the minimum actions required to be considered a “sustainable” company, brands often fall into greenwashing, well-intentioned or not.

However, if the recent investigations are any indication, the landscape may be changing. “Regulation is coming for fashion brands,” said Michelle Gabriel, Professor of Sustainable Fashion Strategy at Glasgow Caledonian New York College (GCNYC). “Brands should reconsider their sustainability strategy, operations, and communication with future possible regulatory compliance in mind. The cost to both reputation and the bottom line for brands finding themselves in the cross hairs of forced change due to new regulations is high.”

In the lawsuit filed against H&M, a June investigation by the news outlet Quartz was cited claiming that more than half of H&M's sustainability profiles portrayed products as being better for the environment than they actually were and, in some cases, were allegedly completely untrue. Those scorecards were based on Higg MSI (Materials Sustainability Index) data, part of a widely used suite of impact measurement tools that have faced growing criticism and recent controversy.

Following the Quartz investigation, H&M removed its Higg sustainability profiles. Shortly after, theSustainable Apparel Coalition(SAC),which owns and oversees the methodology and suite of tools the MSI is a part of,said it would be suspendingthe use of its consumer-facing sustainability profiles and product seals. The decision came after Norwegian authorities concludedthat H&M and other brands would be“breaking the law”for using the MSI's methodology to market their products as more environmentally sustainable.

Without cohesivelegislation, for many brands, third-party certifications and ranking systems have become tools to help guide them on their sustainability journey, assess and measure sustainability credentials, and establish credibility amongst customers and investors. However, as misinformation runs rampant and industry tools come under fire for perpetuating false data and enablinggreenwashing,how can brands manage, verify and communicate their product impact claims?

“It's very challenging for a fashion brand to understand boundaries when communicating about sustainability and impact,” said Gabriel. “That doesn't absolve them of the responsibility to communicate about sustainability or impact honestly and effectively, but the non-linear nature of sustainability, the limited amount of sustainability communication experts in the space, the lack of any clear standards or regulations, and the fear of being called out create a really challenging dynamic to navigate. The brands that communicate their efforts best are the ones that honestly share their sustainability or impact strategy (with benchmarks and goals) with the public, are transparent about wins and struggles, and rarely call a product, effort or facet of their brand ‘sustainable.’ Claiming a brand or a product is ‘sustainable’ is usually a bad plan from the start; it's much better to be specific and honest,” added Gabriel. “Brands that use sustainability to market products tend to find themselves in hot water from consumers and, increasingly, regulators.”

Within thefragmented compliance landscape, for BPCM Director of Corporate Communications and Sustainability, Lauren Daum, it all comes down to following the data, giving context, and being honest. “Sustainability claims need to be precise, supported by credible data, have applicable verifications / certifications, and perhaps most importantly, context - always considering what, if any, information is being omitted,” said Daum. “From a marketing perspective, it's crucial that marketing and communications teams know how to speak the same language as the sustainability teams, understanding the context and importance of efforts to ensure nuance is captured and to avoid mistranslation.”

“The sustainability conversation in fashion is extremely polarized and fear-based,” added Gabriel. “Shifting fashion into a regulated industry will be an uncomfortable transition, especially for an industry which has intentionally avoided regulation for 300 years. In the meantime, without a constructive relationship between brands and regulation, brands are freaked out by any changes. This combination of chaos and fear leads to increased perceived risk, leading brands to slow their sustainability efforts. Sometimes, it prevents brands from speaking about their efforts.”

Rather than fearing future regulation, brands can meet the inevitable regulatory compliance head-on and use it as a mechanism to guide their sustainability strategy. “In addition to legal action, brands should also be aware of the upcoming review by the Federal Trade Commission (FTC) of the Green Guides,” said Hilary Jochmans, founder of PoliticallyinFashion and a government affairs consultant who led a group of fashion brands, experts and advocates that called on the FTC to overhaul its guidance. “Earlier this month, the FTC reaffirmed their commitment to begin the review of the Guides this year. Brands should be prepared to engage with the FTC to ensure this review is a collaborative process resulting in Guides that providepractical advice and examples on how to accurately and responsibly make environmental claims on products without being deceptive. This will also benefit consumers who increasingly want to align their values with their shopping behavior.”