News, Sustainable Governance
SUBMISSION | Senate Inquiry into Greenwashing
Dan Wilcock | August 2, 2023
The UN Global Compact Network Australia (UNGCNA) recently made a submission to the Senate Inquiry into greenwashing. The submission was developed after consultation with UNGCNA Participant businesses, and in light of the UN Global Compact’s Ten Principles – in particular Principle 8: Businesses should undertake initiatives to promote greater environmental responsibility.
Consistent with the focus of the Inquiry on “sustainability claims” beyond just environmental claims (e.g. “greenwashing”), our submission focuses on the broader challenge of “ESG-washing” as misrepresenting the extent to which a good, service or strategy is positive or sustainable under aspects of environmental, social or governance dimensions.
The UNGCNA strongly supports the overarching intent of the Inquiry: to improve the quality and availability of information about environmental and sustainability issues in the market. This objective aligns closely with two specific targets of the Sustainable Development Goals (SDGs):
- 12.6: encourage companies to adopt sustainable practices and sustainability reporting
- 12.8: to ensure that people everywhere have the relevant information and awareness for sustainable development and lifestyles in harmony with nature.
The UNGCNA encourages the Government to strengthen Australia’s suite of policy and legislative tools to prevent ESG-washing – in partnership with the Australian business sector, the international community and other stakeholders. In particular, the UNGCNA made the following recommendations:
- 1. Continue to monitor whether the existing legal provisions are fit for purpose
- 2. Support the provision of more detailed Regulatory guidance
- 3. Continue efforts to mandate sustainability action and disclosure requirements
- 4. Work towards harmonisation of regulatory requirements, standards and principles for ESG-washing across national and international jurisdictions.
The Senate Committee is due to report by 5 December 2023.
The Australian Competition and Consumer Commission (ACCC) subsequently released updated draft Regulatory guidance on environmental claims on 14 July 2023. The ACCC is currently consulting on the draft guidance, closing on 15 September 2023.
