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Navigating Environmental Claims: Key Insights for Businesses Under Canada's Competition Act -

Writer's picture: Marie Horodecki AymesMarie Horodecki Aymes

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The business landscape is rapidly evolving, and environmental claims have become a cornerstone of modern marketing strategies. As we enter 2025, Canadian businesses face new regulatory challenges that demand immediate attention. The Competition Bureau has launched a crucial consultation period that will shape the future of environmental marketing in our country.


Important Notice

Understanding the changes in the Canada's Competition Act is vital for businesses across the spectrum. Whether you manufacture eco-conscious products, craft sustainability messages for your brand, or retail environmentally-friendly offerings, these new regulations will directly impact your operations. The Competition Bureau's consultation, running from December 23, 2024, to February 28, 2025, arrives at a pivotal moment, as new provisions take effect on June 20, 2024.

Whatever the size of your company, the restrictions and requirements for proof are the same. All claims must be substantiated and verified. It is not enough to replicate a competitor's claim without conducting specific verifications on your side. Adhering to these guidelines protects your business from potential legal issues and positions you as a leader in the sustainability-focused market.


What Are We Speaking Of?

The Competition Bureau's initiative represents more than just a regulatory update—it's a fundamental shift in how businesses must approach environmental claims. During this consultation period, stakeholders have a unique opportunity to shape the future of environmental marketing regulations. The timing, just before the holiday season, means many businesses may have overlooked this critical development. Now is the time to engage and understand the implications for your business.


The Opportunity

Environmental marketing has evolved from a nice-to-have into a business imperative. Modern consumers increasingly base their purchasing decisions on sustainability credentials. However, this opportunity comes with heightened responsibility. The new guidelines establish a robust framework that helps businesses build trust while avoiding the pitfalls of greenwashing.

Businesses that embrace these changes can achieve several advantages:

  • Build deeper consumer confidence through transparency.

  • Distinguish themselves in an increasingly competitive market.

  • Protect themselves from both regulatory penalties and reputational harm.

  • Position themselves as leaders in sustainable business practices.


Overview of the Guidelines

The Competition Bureau's approach centers on four fundamental pillars, each designed to ensure the integrity of environmental claims:

  1. Truthfulness: Every environmental claim must not only be honest but must also be supported by adequate evidence. The new provisions require pre-claim substantiation, meaning businesses must verify their claims before making them public.

  2. Specificity: Generic terms like "eco-friendly" no longer suffice without detailed context and supporting evidence. Claims must clearly state what environmental benefit is being delivered and how it's achieved.

  3. Methodology Requirements: Claims about business environmental benefits must now be supported by "internationally recognized" methodologies—defined as those recognized in two or more countries. This standardization helps ensure consistency and credibility across the market.

  4. Documentation: Businesses must maintain clear evidence trails supporting their environmental claims, potentially including third-party verification when required by the chosen methodology.


Practical Examples in Action

Understanding how these guidelines apply in real-world situations helps illuminate their practical impact.


  • Example 1 - Beverage Company: Simply claiming "eco-friendly packaging" could lead to compliance issues. Instead, the company needs to provide specific, verifiable claims such as "Our bottles contain 100% recycled PET plastic, verified by [certification body]."


  • Example 2 - Clothing Retailer: A retailer wanting to promote its environmental initiatives must move beyond vague sustainability claims. For instance, rather than claiming "sustainable manufacturing," the business should specify "Our facility reduces water consumption by 40% compared to industry standards, verified through ISO 14046 methodology."


These examples demonstrate how businesses can transform their environmental marketing from general assertions to powerful, credible claims that resonate with consumers while meeting regulatory requirements.


Risks and Mitigation Strategies

The Stakes of Non-Compliance

The stakes for non-compliance have never been higher. Businesses face a range of consequences for failing to meet these new standards:

  • Regulatory Impact: The Competition Bureau can now investigate claims more rigorously, potentially leading to significant administrative monetary penalties. The introduction of private right of action means competitors and other stakeholders can challenge questionable claims before the Competition Tribunal.

  • Reputational Considerations: Beyond regulatory penalties, businesses face increased scrutiny from consumers, media, and environmental groups. Accusations of greenwashing can rapidly damage brand value and consumer trust.

Mitigation Strategies

To navigate these risks effectively, businesses should:

  1. Conduct thorough internal audits of existing claims.

  2. Establish robust verification processes, including third-party validations when necessary.

  3. Maintain detailed documentation of all environmental assertions.


How to Prepare Your Business to the updated Canada's Competition Act

Success under the new framework requires a systematic approach to environmental claims:

  • Audit: Review all current environmental claims across marketing channels, product packaging, and corporate communications. Document the evidence supporting each claim and identify any gaps in substantiation.

  • Verification: Establish clear protocols for testing and verification. Claims must be substantiated before they're made public. Work with accredited laboratories, environmental consultants, or certification bodies when necessary.

  • Documentation: Develop a system that tracks the journey of each environmental claim from initial concept through verification to public communication. This creates an audit trail that demonstrates due diligence and supports compliance.


The Consultation Opportunity

The Competition Bureau's consultation period represents more than just a regulatory requirement—it's an opportunity for businesses to help shape the future of environmental marketing in Canada. By participating actively in this process, companies can:

  • Share practical insights about implementing these requirements in real-world business operations. This helps ensure the final guidelines balance regulatory rigor with operational feasibility.

  • Position themselves as thought leaders in sustainable business practices. Active participation demonstrates commitment to environmental integrity and market leadership.

  • Gain early insights into regulatory expectations, allowing for more effective preparation and implementation strategies.


Next Steps for Success

The time to act is now. With new provisions taking effect on June 20, 2024, businesses should:

  • Begin reviewing and documenting all environmental claims immediately.

  • Establish relationships with appropriate verification bodies.

  • Train marketing and compliance teams on the new requirements.

  • Participate in the consultation process before the February 28, 2025 deadline.

For expert guidance in navigating these changes, reach out to [Your Contact Information]. Our team specializes in helping businesses transform environmental compliance challenges into competitive advantages.



These changes represent more than just regulatory requirements—they're an opportunity to build stronger, more trustworthy relationships with your customers while contributing to a more sustainable future. Take the initiative today and lead the way in environmental integrity.


Contact Details:

For assistance, contact us at marie.horodecki.aymes@mhainsights.com


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2024年12月28日
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THANKS FOR THIS INFORMATION

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