New greenwashing laws in Canada: a giant step towards responsible consumption and communication

Competition Act amendments

The Canadian legislative framework has been strengthened by significant amendments to the Competition Act. These specifically target misleading marketing practices related to environmental claims. From now on, any company claiming that its products or services are beneficial to the environment must provide solid evidence to back up these claims. Competition authorities will now have the power to verify the veracity of such claims and sanction offending companies.

Prohibition of misleading marketing practices

Under the new rules, it is also forbidden for companies to publicly declare the environmental benefits of their products without substantial, verifiable proof. This includes terms such as “ecological”, “sustainable” or “green”, which are often misused to attract environmentally conscious consumers. Companies must be able to demonstrate, through independent studies or certification, that their products really do meet the environmental criteria they claim.

Corporate responsibility

Another key provision of this legislation is the shift of the burden of proof to companies. In other words, it is now up to the company making an environmental claim to prove its veracity. This measure considerably increases the responsibility of companies and encourages them to be more transparent in their marketing practices. In case of misrepresentation, companies can face penalties of up to several million dollars.

Monitoring and sanctions 

The bill also proposes the creation of an oversight entity or the strengthening of the powers of existing entities to monitor companies’ environmental reporting practices. These entities will have the power to conduct investigations and impose sanctions.

Penalties under the new legislation are strict and can reach very high levels. Companies found guilty of greenwashing can be fined up to several million dollars, depending on the seriousness of the offence and the extent of the damage caused to consumers and, of course, the environment.

Awareness campaigns 

To make consumers more informed and vigilant, awareness campaigns will be set up. These will educate them about greenwashing practices and how to recognize legitimate environmental claims. 

How do you know if your company is involved in greenwashing?

You have a company and would like to know its greenwashing risk? We invite you to take the Social Capital Index, our proprietary diagnostic tool for assessing the balance between your impact actions and your communications. 

In conclusion, companies operating in Canada will need to review their marketing and communications strategies to ensure they comply with the new legislative requirements. They will need to invest in verification processes and obtain recognized certifications for their green products and services. In addition, they will have to be prepared to provide concrete evidence for any green claims they make.

The measures adopted in Bill C-59 concerning greenwashing are designed to ensure that companies provide solid proof for all environmental claims, on pain of sanctions. This implies greater transparency and responsibility on the part of companies towards consumers and the environment alike.

Sources :

Gouvernement du Canada. (2024). Amendements à la Loi sur la concurrence.
Globe and Mail. (2024). Nouvelles règles sur l’écoblanchiment : ce que les entreprises doivent savoir.
Radio-Canada. (2024). Marketing trompeur et écoblanchiment : le Canada serre la vis.
Bureau de la concurrence Canada. (2024). Directive sur les allégations environnementales.
CBC News. (2024). Sanctions sévères pour les entreprises pratiquant l’écoblanchiment au Canada.