Navigating Green Claims and Carbon Communications: A Practical Compliance Guide for Businesses
Last week, we hosted a client webinar, Understanding Carbon Claims & Your Ekos Certification, exploring how organisations can communicate carbon claims clearly, credibly and in line with their Ekos certification. We have summarised the key topics discussed and added further practical guidance and detail.
1. Introduction: Credible Storytelling in Sustainability Communication
In an era where consumers, regulators, and commercial partners increasingly demand environmental accountability, organisations face mounting pressure to communicate their carbon performance and sustainability achievements.
However, fear of greenwashing allegations or regulatory penalties can sometimes lead organisations to remain silent — a phenomenon known as “greenhushing”.
A core principle established within the Ekos compliance framework provides essential direction for modern sustainability communications:
“Start with Why.” — Simon Sinek
You do not need a perfect story to tell a credible story.
Organisations can — and should — communicate their carbon performance even when emissions have not decreased or when overall progress appears mixed. Achieving operational perfection is not a prerequisite for public disclosure.
Instead, credible communication hinges on transparency: being open about performance metrics, acknowledging operational headwinds, demonstrating the practical work undertaken, and setting out realistic future pathways.
The purpose of transparent sustainability messaging is to build long-term stakeholder trust, show the work, explain progress accurately, and avoid creating a false or misleading impression.
2. The Four Pillars of Credible Storytelling
To construct an authentic, compliant, and legally sound sustainability narrative, organisations should ground every disclosure in four essential pillars:
1. Results — What happened?
State actual performance outcomes, greenhouse gas inventory numbers, and operational figures clearly, avoiding selective data presentation or omission of material impact areas.
2. Actions — What did you do?
Detail the concrete operational steps, efficiency investments, and reduction initiatives implemented by the organisation during the relevant assessment period.
3. Context — What influenced the outcome?
Provide transparency regarding internal operations or external drivers that influenced carbon performance, such as production volume growth, supply chain disruptions, or structural operational changes.
4. Next Steps — What do you plan to do next?
Outline realistic, well-defined future ambitions and concrete, time-bound action plans designed to advance decarbonisation.
Together, these four elements help move sustainability communication away from promotional statements and towards a more complete and credible account of an organisation’s climate journey.
3. New Zealand Regulatory Framework: What Businesses Need to Know
In New Zealand, environmental claims are subject to both statutory regulation and industry self-regulation.
The two key bodies businesses should be familiar with are the Commerce Commission and the Advertising Standards Authority (ASA).
Commerce Commission
The Commerce Commission enforces the Fair Trading Act 1986, including provisions relating to misleading or deceptive conduct and unsubstantiated representations.
Businesses need to have reasonable grounds for representations at the time those claims are made. The evidence supporting a claim should therefore be available before the claim is published, rather than being assembled afterwards.
Potential consequences include investigations, formal warnings and court proceedings, with significant financial and reputational consequences possible.
Advertising Standards Authority
The ASA administers the Advertising Standards Code and considers complaints about advertising, including environmental claims.
The Code requires environmental claims to be truthful, accurate and appropriately substantiated. It also addresses the overall impression created by advertising, meaning that claims can be problematic not only because of the words used, but also because of imagery, comparisons, omissions and other elements of the advertisement.
What counts as an environmental claim?
Environmental claims can extend well beyond explicit statements such as “reduces emissions by 30%”.
They may include:
Words and numbers, such as “100% eco-friendly” or “low carbon”.
Visual imagery and colours that create an environmental impression.
Symbols, logos and certification marks.
Comparative claims such as “greener” or “more sustainable”.
Omissions or presentation choices that leave consumers with a misleading overall impression.
The key takeaway: environmental claims should be considered from the perspective of the overall impression created for the average consumer — not simply whether an individual sentence is technically accurate.
Want to explore the New Zealand requirements in more detail?
Read more: Expanded statutory and Advertising Standards Code requirements → Appendix A
This additional resource provides more detail on the Fair Trading Act 1986, relevant ASA Code provisions and how environmental claims are defined under New Zealand law.
4. Real-World Enforcement: What Can We Learn from NZ Cases?
The principles above are not simply theoretical. New Zealand courts and regulators have taken action where environmental, product, origin and performance claims were considered misleading or inadequately substantiated.
These cases highlight some recurring lessons:
Claims need evidence: businesses need reasonable grounds and appropriate supporting evidence when making environmental and performance claims.
The overall impression matters: imagery, wording, logos, comparisons and omissions can all influence how a claim is understood.
Claims need to reflect real-world conditions: technical or laboratory results may not support broader claims about what consumers can expect in practice.
Scope and limitations matter: certifications, environmental attributes and other claims should not be presented as applying more broadly than the evidence or certification supports.
The message for businesses is simple: a claim can be problematic even when some element of it is technically true if the overall communication creates a misleading impression.
Want to explore the cases?
See the NZ enforcement case studies → Appendix B
Our detailed case studies provide examples of enforcement action, the claims involved, the evidence considered and the issues identified by New Zealand courts and regulators.
5. Demystifying Carbon Terminology and Standards
Using carbon terminology correctly is an important part of credible environmental communication.
Terms such as carbon neutral, zero carbon, net zero, carbon positive, climate positive, carbon credit and carbon offset have different meanings and should not be treated as interchangeable.
Carbon Neutral
Under ISO 14068 and relevant MfE guidance, carbon neutrality involves addressing greenhouse gas emissions for a defined subject — such as an organisation, product, activity or event — over a specified reporting period.
This involves quantifying emissions, implementing a reduction plan and addressing remaining emissions through credible carbon credits where appropriate.
Under MfE guidance for voluntary emissions offsetting, carbon offsets should derive from tangible activities that have already been implemented. Future commitments alone do not constitute an offset until the relevant activity has occurred and delivered the claimed climate benefit.
Zero Carbon
“Zero carbon” describes an absolute state in which no greenhouse gas emissions are produced by the relevant activity, operation or product lifecycle – quite unlikely to happen.
Net Zero Carbon
Net zero generally means that the organisation or product is committed to achieve emissions reductions across the relevant footprint before offsetting remaining emissions and keeping a long-term strategy to plan to keep pursuing emissions reduction.
Carbon Positive / Carbon Negative
These terms can describe situations where more greenhouse gas emissions are removed or offset than are generated. However, terminology can be interpreted differently by consumers, so organisations should consider whether clearer language would better communicate the intended outcome.
Climate Positive
Climate Positive is similar to Net Zero, but in this case more emissions are removed or mitigated than emitted. For example, offsetting 120% of the remaining emissions.
Carbon Credit vs Carbon Offset
A carbon credit is a certified unit representing one metric tonne of CO₂-equivalent reduced, avoided or removed.
A carbon offset generally refers to the use and retirement of carbon credits against a measured greenhouse gas footprint.
The key takeaway: before using carbon terminology in marketing, make sure the term accurately reflects what has actually been measured, reduced, removed, certified or offset.
6. Communicating Ekos Certification
Certification can provide valuable independent evidence, but certification should always be communicated within its defined scope and boundaries.
Organisations using Ekos certification should ensure that certification claims:
Use the exact certification name shown on the active certificate.
Reflect the assessed subject, operational boundaries and reporting period.
Do not imply that certification applies to activities, subsidiaries, products or operations outside the assessed scope.
Present certification as supporting evidence rather than as the entirety of the organisation’s sustainability story.
For more detailed guidance on communicating Ekos certification and using programme-related claims, please refer to the Ekos Programme Communications Guidelines.
7. Global Standards & the EU EmpCo Directive
For New Zealand businesses selling into international markets, particularly the European Union, environmental communication requirements are becoming increasingly important.
The EU’s Empowering Consumers for the Green Transition Directive (EU 2024/825) amends the Unfair Commercial Practices Directive and introduces additional restrictions on environmental marketing claims.
Member States were required to transpose the Directive by 27 March 2026, with the new requirements applying from 27 September 2026.
Some of the key changes include:
Restrictions on generic environmental claims such as “green”, “sustainable”, “climate-friendly” and “environmentally friendly” unless the required basis for making the claim is demonstrated.
Greater scrutiny of future environmental performance claims, including commitments such as “Net Zero by 2030”, which require an appropriate implementation plan.
Restrictions on climate claims based on offsetting, including claims that a product (goods or services) has a neutral, reduced or positive climate impact where this relies on greenhouse gas offsetting. The claim must not mislead consumers by making them believe that such a claim would relate to the product itself, or the supply or production of that product.
Greater controls over sustainability labels, including requirements relating to recognised public schemes or appropriately verified certification schemes.
The Directive also introduces practical challenges for businesses managing existing products and marketing materials, particularly where claims remain visible through digital channels.
For New Zealand exporters, this highlights an important principle: environmental claims should be designed with the markets in which they will be seen in mind.
Digital content is particularly important because websites, e-commerce pages, ESG landing pages and digital brochures can be updated rapidly and are likely to receive regulatory attention.
8. Before You Publish: A Practical Compliance Check
Before publishing an environmental claim, it is useful to step back and ask whether the communication is accurate, appropriately supported and clear about its scope.
A practical review should consider questions such as:
What exactly are we claiming?
What does our certification or supporting evidence cover?
What has been measured and what has been excluded?
Could the overall impression be different from the literal wording?
What evidence supports the claim?
Are our reduction actions and future commitments clearly represented and realistic?
Can consumers easily access the information needed to understand the claim?
These questions can help marketing, sustainability and communications teams identify potential issues before claims are published.
Want the full checklist?
See the complete 8-question pre-publishing compliance checklist → Appendix C
The full checklist provides a practical tool that organisations can use internally when reviewing environmental claims across websites, advertising, social media, packaging and other communications.
9. Conclusion and Next Steps
Navigating environmental disclosures requires a structured sequence that connects internal operational performance to external communication:
1. Identify Material Risks & Opportunities →
2. Prioritise Strategically →
3. Take Action →
4. Improve Capability & Build Resilience →
5. Communicate
By systematically measuring greenhouse gas footprints, maintaining precise boundary definitions, verifying source evidence, and placing transparency at the heart of your strategy, your business can communicate its climate journey with confidence.
The goal should not be to create a perfect sustainability story.
It should be to create an accurate, transparent and credible story that reflects where your organisation is today, what it is doing, and where it is going next.
Regulatory Compliance Advisory: While internal review against this guide is an essential preliminary step, organisations should always obtain legal or specialist sustainability advisory support when drafting, verifying, or publishing complex environmental claims, comparative marketing campaigns, or structural carbon disclosures.
Appendix A
Expanded NZ Statutory & Advertising Standards Code Requirements
Environmental claims in New Zealand are subject to both legislation and industry self-regulation. Understanding the different requirements helps organisations assess not only whether a claim is technically accurate, but whether the evidence, presentation and overall impression are appropriate.
Fair Trading Act 1986
The Fair Trading Act 1986 (FTA) provides the primary statutory framework governing misleading representations made by businesses to consumers.
Section 9 — Misleading and deceptive conduct
Section 9 prohibits conduct that is misleading or deceptive, or is likely to mislead or deceive, in trade.
Importantly, a claim does not necessarily need to contain an outright false statement to create an issue. The overall impression created by the communication can be relevant, including the way information is presented, qualified or omitted.
For environmental communications, this means businesses should consider the message that an ordinary consumer is likely to take from the communication as a whole.
Section 12A — Unsubstantiated representations
Section 12A addresses representations made without reasonable grounds.
The key principle is that businesses need to have reasonable grounds for a representation at the time it is made.
This means that evidence should not be developed retrospectively after a claim has been challenged. Organisations should be able to demonstrate the basis for their claims before publication.
The nature of the claim will influence what constitutes reasonable grounds. Depending on the claim, relevant evidence may include:
· Scientific research or testing.
· Relevant technical standards.
· Product or operational data.
· Independent verification or certification.
· Comparative data.
· Evidence from credible and appropriately qualified sources.
The stronger or more specific the claim, the stronger and more directly relevant the supporting evidence is likely to need to be.
Advertising Standards Code
The Advertising Standards Authority (ASA) administers the Advertising Standards Code and considers complaints about advertising in New Zealand.
Environmental claims are particularly relevant to:
Principle 1 — Social Responsibility
Advertising should observe a high standard of social responsibility.
Rule 1(i) specifically addresses environmental considerations and states that advertisements should not depict or encourage environmental damage or degradation.
Advertisers should also take particular care when advertising or depicting areas of significant conservation value, including environments such as beaches, wetlands, riverbeds, lake margins, estuaries and other sensitive natural areas.
Principle 2 — Truthful Presentation
Advertising must be truthful and not misleading.
Environmental claims should be accurate and capable of being substantiated by appropriate evidence, taking into account relevant scientific knowledge and developments.
Particular care is required with:
· Absolute environmental claims.
· Comparative environmental claims.
· Claims about environmental benefits.
· Claims based on scientific or technical performance.
· Claims where important limitations or conditions apply.
For example, a claim such as “environmentally friendly” makes a broad environmental proposition and can be difficult to substantiate across the relevant lifecycle.
A comparative statement such as “more environmentally friendly” also requires a meaningful basis for comparison.
What is an Environmental Claim?
An environmental claim is not limited to a sentence explicitly mentioning carbon, emissions or sustainability.
Consumers can receive an environmental message through the overall presentation of an advertisement, product, website or other communication.
Environmental claims may therefore be created through:
Words and numbers
Examples include:
· “100% eco-friendly”
· “Low carbon”
· “Reduces emissions by 30%”
· “Climate positive”
· “Net zero by 2030”
Images and colours
Images of forests, native wildlife, pristine waterways, green landscapes or other environmental imagery can contribute to the overall environmental impression of a communication.
Symbols and certification marks
Environmental logos, labels, certification marks and other symbols can communicate environmental attributes even where the accompanying text is limited.
Comparisons
Statements such as:
· “Greener”
· “More sustainable”
· “Lower carbon”
· “Better for the environment”
can create comparative claims that require an appropriate benchmark.
Omissions
A claim can also become misleading where important information is omitted.
For example, a communication may highlight an environmental benefit while failing to disclose a material limitation, exclusion, lifecycle impact or condition attached to that benefit.
Practical Implication for Businesses
Before publishing an environmental claim, businesses should ask:
What would a reasonable consumer understand from the communication as a whole?
The answer should be supported by evidence that was available when the claim was made.
The safest approach is not simply to ask whether each individual statement is technically true. Consider the complete communication — wording, imagery, comparisons, qualifications, certification marks and omissions — and the overall impression they create together.
Appendix B
NZ Green Claims Enforcement Case Studies
New Zealand enforcement cases provide useful practical examples of how misleading or inadequately substantiated claims can create legal and reputational consequences.
The cases below illustrate an important principle: compliance is not simply about whether a statement contains a factual element. The overall impression created for consumers, and whether the evidence supports that impression, also matters.
1. Smallgoods Producer — Origin and Farm Imagery
Penalty: $180,000 fine
A smallgoods producer used farm imagery, rural building graphics and phrases including “Farmland Fresh”, “100% NZ owned” and “Made by New Zealanders, for New Zealanders”.
The issue was that the presentation created an impression that the products were made from New Zealand-reared pork, while 87% of the pork was imported.
Key lesson
Environmental and provenance claims can be created through the combination of words and imagery, rather than through one explicit statement alone.
2. Heat Pump Supplier — Efficiency Claims
Penalty: $310,000 fine
A heat pump supplier made claims about heat output relative to electricity costs.
The court found that the advertised performance could only be achieved under narrow laboratory conditions — including specific outdoor and indoor temperatures and operation at full load — rather than under normal consumer conditions.
The business also claimed to have “New Zealand’s most energy efficient heat pump range” based on having the highest number of Energy Star marks. The court found this did not substantiate a comparative efficiency claim because the Energy Star system operates on a pass/fail basis.
Key lesson
Technical or laboratory performance should not automatically be presented as representative of normal real-world performance. Comparative claims also need an appropriate basis of comparison.
3. Water Filter Company — Scientific Claims
Penalty: $162,000 fine
A water filtration company advertised its systems as “scientifically proven”.
The supporting evidence included general internet literature, limited internal trials and anecdotal customer feedback.
The court considered the evidence inadequate to support the scientific efficacy claims.
Key lesson
The level of evidence needs to be appropriate to the strength and specificity of the claim. Calling a product or environmental benefit “scientifically proven” creates a particularly strong expectation about the quality of supporting evidence.
4. Plastic Rubbish Bags — Biodegradability Claims
Penalty: $60,000 fine
A manufacturer marketed rubbish bags as “oxo-biodegradable”.
The court found that the bags would not biodegrade in standard landfill environments within timeframes consumers could reasonably expect, such as 12–24 months. Important limitations relating to commercial composting availability in New Zealand had also not been adequately disclosed.
Key lesson
Environmental claims should reflect real-world conditions and consumer expectations, including material limitations on where and how an environmental benefit can actually occur.
5. Certified Organic Butcheries — Certification Scope
Successful criminal prosecutions
Two separate cases involved businesses representing products as “certified organic” when the certification did not cover the full circumstances represented.
In one case, chicken came from certified organic farms, but the retail butchery facility itself was not certified. Products were also represented as organic despite containing non-organic ingredients.
In another case, processed meats were represented as certified organic even though secondary ingredients such as binders and seasonings were not organic.
Key lesson
Certification has a defined scope. Businesses should not extend a certification claim beyond the subject, activities, products, facilities or ingredients actually covered by the certification.
6. Freshly Squeezed Limited — Overall Impression
Conviction under the Fair Trading Act 1986
The company’s legal trading and brand name, “Freshly Squeezed Limited”, contributed to an overall impression that its juice products consisted of 100% freshly squeezed juice when they did not.
Key lesson
A potentially misleading impression can arise from branding itself, not only from a specific advertising statement.
7. Taxi Companies — Environmental Benefits and Programme Associations
Formal warnings and investigation
Two taxi-related cases illustrate different risks.
One company made claims about reductions in CO₂ emissions and fuel efficiency that were considered overstated.
Another claimed that it funded tree planting initiatives with organisations associated with the carboNZero programme. The Commission found the advertising misleading because the tree planting occurred overseas and the advertising created a false impression of an official corporate association with the programme.
Key lesson
Environmental claims should accurately represent both the magnitude of an environmental benefit and the nature of any relationship with certification or environmental programmes.
What These Cases Have in Common
Although the cases involve different industries and types of claims, several common themes emerge:
1. Evidence matters.
Claims should be supported by appropriate evidence before they are published.
2. The overall impression matters.
Words, imagery, branding, symbols and omissions can collectively communicate an environmental message.
3. Real-world conditions matter.
Laboratory results or theoretical benefits should not automatically be presented as outcomes consumers can expect in normal use.
4. Scope matters.
Certification and environmental attributes should not be represented as applying beyond their actual boundaries.
5. Specific claims require appropriate substantiation.
The stronger the claim, the stronger and more directly relevant the supporting evidence should be.
For organisations communicating their carbon or sustainability performance, these principles provide a useful practical test:
Could we demonstrate the basis for this claim, and would a reasonable consumer understand it in the way we intend?
Appendix C
8-Question Environmental Claims Pre-Publishing Checklist
Before publishing website copy, advertising, social media posts, packaging or other communications containing environmental claims, use the following checklist to review the proposed communication.
The objective is not to prevent organisations from communicating their sustainability progress. It is to help ensure that claims are accurate, appropriately substantiated, transparent about their boundaries and unlikely to create a misleading overall impression.
01. What are we claiming?
Identify the claim clearly.
Ask:
· What environmental or sustainability claim are we making?
· Is it explicit or implied?
· Is it absolute or comparative?
· What would an average consumer understand from the overall communication?
· Do the words, images, colours, logos and other elements communicate the same message?
Check: Can we describe the claim in one clear sentence?
02. What does the certification cover?
Where a certification or verification is referenced, check that the communication accurately reflects its scope.
Ask:
· What entity, product, activity or operation is certified?
· What reporting period does the certification cover?
· Are there subsidiaries, products, locations or activities outside the certification boundary?
· Does the wording imply broader certification than actually exists?
Check: Does the claim match the exact subject, boundary and timeframe of the certification?
03. What was measured?
Clearly identify the basis of any environmental performance claim.
Ask:
· What was measured?
· What methodology was used?
· What reporting period does the data relate to?
· What emissions sources or lifecycle stages are included?
· Are the boundaries clearly defined?
Check: Could an interested reader understand what the reported environmental performance actually relates to?
04. What was excluded?
Consider whether exclusions or limitations could materially affect how the claim is understood.
Ask:
· Were any emissions sources excluded?
· Are there lifecycle stages outside the assessment boundary?
· Are there material operational exclusions?
· Are there geographical, product or organisational limitations?
Check: Could an informed consumer reasonably reach a different conclusion if they knew about the exclusions?
If so, consider whether the information should be disclosed alongside the claim.
05. Why are we doing this?
Consider whether the communication explains the organisation’s purpose and motivation rather than simply presenting an environmental achievement as a marketing benefit.
Ask:
· Does the communication explain why the organisation is taking action?
· Does it reflect the organisation’s actual sustainability journey?
· Is the story consistent with the organisation’s wider activities?
Check: Does the communication tell an authentic story rather than simply promote an environmental label or achievement?
06. What are we doing to reduce emissions?
Where carbon claims are being made, distinguish between:
· Measuring emissions.
· Reducing emissions.
· Removing emissions.
· Using carbon credits or offsets.
Ask:
· What direct emissions reduction actions have been undertaken?
· Are reduction actions clearly distinguished from offsetting?
· Are future commitments presented as commitments rather than achievements?
· Does the communication accurately describe the role of carbon credits or offsets?
Check: Does the communication make it clear what has actually happened versus what is planned?
07. What evidence supports the claim?
Identify and retain the evidence supporting the claim before publication.
Depending on the claim, this could include:
· GHG inventory data.
· Technical studies.
· Scientific research.
· Testing results.
· Certification or verification.
· Recognised standards.
· Independent assessments.
· Comparative data.
Ask:
· Is the evidence current?
· Is it relevant to the exact claim?
· Does it support the strength of the claim?
· Would the evidence withstand reasonable external scrutiny?
Check: Could we provide the evidence if a regulator, customer, journalist or other stakeholder asked us to substantiate the claim?
08. Can someone easily find the detail?
Supporting information should be accessible where consumers need it.
Ask:
· Is there enough information alongside the claim to prevent misunderstanding?
· Can consumers access supporting information through a direct link or QR code?
· Are important qualifications visible rather than hidden in fine print?
· Does the supporting information genuinely clarify the headline claim?
Check: Would someone encountering the claim for the first time be able to find the information needed to understand it properly?
Final Review
Before publication, ask one final question:
If someone saw only this communication, without any additional explanation from us, would they form an accurate understanding of what we have achieved, what we have measured, what remains outside the boundary, and what we intend to do next?
If the answer is no, consider whether the claim, supporting information or overall presentation should be revised.
Keep the Evidence
Organisations should retain the evidence supporting environmental claims at the time the claim is published.
This creates a clear audit trail and helps ensure that marketing, sustainability and communications teams are working from the same information.
Remember: the purpose of this checklist is not to make sustainability communication more difficult. It is to help organisations communicate their progress confidently, accurately and transparently.