Taming the 'Wild West' of Green Marketing: A History of the U.S. Green Guides

During a 1991 Minnesota Public Radio program, a listener mentioned that environmental claims on packaging were vague and confusing to consumers. "Half the time I can't figure out," he said, "what they're trying to say." Hubert "Skip" Humphrey, then Minnesota Attorney General, was a guest on the program and agreed.

"I went to the store the other night, walked down an aisle, and sure enough, I saw some claims like the ones you're talking about. There was a spray can that said 'safe for the environment,' who knows what that means..." he responded.

At that time, a decade had passed since scientists began worrying about the impact of chemicals in aerosols and refrigerators on the ozone layer, and several years since the Montreal Protocol was signed to phase out such substances. But marketing claims about being "ozone-friendly" were still largely unchecked.

That changed on July 28, 1992, when the Federal Trade Commission—under pressure from a group of state attorneys general led by Humphrey and manufacturers seeking guidance—issued the Guides for the Use of Environmental Marketing Claims.

The rules, quickly nicknamed the Green Guides, were designed to provide clear guidance to businesses on the types of environmental marketing claims they could make about their products and packaging. Since then, they have helped make the term "greenwashing" a household phrase and have driven numerous policy shifts over the years.

Although the Green Guides themselves are not independently enforceable, the FTC can bring actions under the Federal Trade Commission Act—which prohibits unfair methods of competition and unfair or deceptive acts or practices affecting commerce—citing the Guides.

After updating the Guides multiple times in 1996, 1998, and 2012, the FTC is now considering what could be one of its most consequential revisions to the Green Guides.

With public debate over the effectiveness of recycling intensifying and states increasingly passing legislation to regulate environmental marketing, the boundaries of the Green Guides' influence are also under scrutiny. This update could mark a significant shift in the FTC's regulatory approach.

A sense of déjà vu for the Green Guides

In 1990, a survey by J. Walter Thompson, published in Advertising Age, showed that 96% of consumers felt they needed more information to understand environmental marketing claims. So when the FTC issued the Green Guides, it aimed to guide companies in crafting claims in ways consumers could understand—such as whether packaging was recyclable and how to dispose of it—while making it easy for marketers to meet the Guides' requirements with substantiated language.

More than three decades later, modern consumers have grown up in a recycling system, but they face a new, perhaps more difficult problem: rapidly growing distrust.

Suzanne Shelton, president and CEO of market research firm Shelton Group, says years of marketing around recyclability allowed packaged goods companies to assuage consumer concerns about their consumption habits. In her view, the message conveyed was: "Go ahead and buy stuff, don't feel guilty about it, because you just throw it in the blue bin and it goes to a magical place called 'away' and becomes something else."

But that has changed. A recent Shelton Group survey of 6,500 people found that nearly a third of Americans are not confident that items they put in their recycling bins are actually recycled. Four years ago, that figure was just 14%.

There are other notable similarities between the current moment and the early 1990s.

Back then, many state governments were considering or enacting regulations aimed at environmental marketing claims. Today, recently passed laws in California and Oregon are forcing marketers to change how they communicate recyclability, such as removing the chasing arrows around resin identification codes and providing clear and accurate recycling instructions instead.

Back then, packaging-related technology was advancing rapidly, with a focus on biodegradability. Now, the discussion centers on chemical recycling of plastics and the scaling of plant-based and compostable materials.

The macro sustainability issues then revolved around ozone depletion and landfill space. Today, they concern carbon emissions and material circularity.

Another key similarity: in the early '90s, consumers were eager to incorporate sustainability into their purchasing decisions but were confused or distrustful about whether packaging going into the recycling stream was actually being recycled.

"It was a real 'Wild West' environment, and companies realized that being green could give them a competitive advantage," says Doug Blanke. He served as assistant attorney general and director of the consumer protection division in the Minnesota Attorney General's office during Humphrey's tenure.

Blanke recalls that some manufacturers "reformulated their products," but others "just reformulated their advertising." He cites fast-food companies, some of which used polystyrene foam containers with recycling symbols to serve food.

"When we looked into it, we found that recycling foam was technically feasible, but the nearest recycling facility was 400 miles away in Chicago. You're not going to mail your McDonald's container to Chicago to be recycled," Blanke said.

After the FTC issued the Green Guides, Blanke moved on to consumer protection issues in the tobacco industry, but he believes the Green Guides were effective and worked as intended.

Marketers, manufacturers, consumers, and environmental groups all got what they wanted: clear guidelines written in language everyone could understand. And the legal cases the attorneys general task force brought and won before and after the Guides were issued—including one against a manufacturer claiming its diapers were biodegradable—sent an effective signal to other companies: they could face legal scrutiny.

"You don't want to be the poster child for environmental irresponsibility," Blanke said. "I mean, biodegradable diapers, come on."

However, Blanke believes the FTC would not have developed the Green Guides without the pressure from the attorneys general task force. Nor does he think state attorneys general today could collaborate as seamlessly as they did back then, because the environment was less partisan at the time.

Not all stakeholders were optimistic after the Guides were issued. In Marketing News (a publication of the American Marketing Association), environmental researcher Bentham Paulos and Abt Associates senior analyst Andrew Stoeckel wrote in 1993 that they were "not sure the Guides have had the effect marketers expected."

They described two major complaints from marketers: first, the Guides were voluntary in theory but not in practice, creating a "Catch-22"—the FTC was saying, "If you voluntarily follow our advice, we won't force you"; second, the Green Guides failed to and could not address the looming issue of state legislation regulating environmental marketing claims.

However, the hope was that any state seeking to enact new laws would look to the Green Guides as a reference, thereby reducing the need for marketers to adjust their environmental marketing strategies.

Evolution of the Guides

In the two years following the release of the initial Guides in 1992, a group of researchers from the University of Illinois and the University of Utah audited their early impact by examining brand labels in supermarket product categories.

During the study period, researchers found that brands had made significant changes in line with the FTC Guides. Environmental claims generally became more specific and meaningful. Claims mentioning ozone decreased, likely because the Green Guides required marketers to substantiate such claims, but general environmental commitment claims nearly tripled.

Packaging recyclability claims increased, but not necessarily in a way that helped alleviate consumer confusion—because, inconsistent with the Green Guides, these claims lacked specificity and were mostly vague, such as "Please Recycle." However, the Guides required marketers to provide specific instructions on where or how to recycle the packaging or product, unless recycling facilities were available to a "substantial majority of consumers or communities."

In the first update in 1996, language was added requiring marketers to substantiate claims like "environmentally preferable," and the FTC also sought to clarify how to use the chasing arrows symbol. It advised marketers to specify whether the symbol indicated recycled content or recyclability, and instructed them to indicate where to recycle and what recycled content was included, if any.

As environmental marketing and consumer interest in sustainable products grew rapidly, the FTC quickly conducted a second round of revisions in 1998.

These revisions included: recyclability claims could cover "reuse, reconditioning, and remanufacturing of a product or part in another product," and recycled content claims should only apply to "products or packaging that have been reused as 'raw materials' in the manufacture or assembly of a 'new' package or product." With the growth of multi-channel commerce, the FTC also clarified that service marketers and marketing conducted via the Internet and email were also subject to the Guides.

After that, the FTC did not issue its next update until 2012. The process began with a workshop in 2007 and was originally scheduled for 2010, but was slowed by the change in presidential administration in 2008.

In addition to new sections on carbon offsets, green certifications and seals, renewable energy, and renewable material claims, the 2012 Green Guides also included other packaging-related revisions, such as compostability claims. Besides clarifying whether a package or product would break down "safely and in a timely manner" into usable compost in an industrial compost facility or a home garden setting, the update clarified that "timely manner" means "the same time as the compostable materials."

Early versions advised marketers to qualify recyclability claims when recycling facilities did not cover a "substantial majority" of consumers or communities. The 2012 update clarified that this threshold was at least 60%, and stated that "the lower the availability of facilities, the more marketers should emphasize the limited nature of product recycling." This change quickly gave rise to voluntary brand support systems like the How2Recycle label, which has become a focal point of discussion in the latest update process.

In comments submitted to the FTC for the next round of updates, industry and advocacy groups expressed differing views on issues such as how to reduce contamination in the recycling stream. Sometimes recyclers want clearer language on certain products, while the companies behind the products want a more nuanced approach to recyclability claims for new materials.

Although groups disagree on some issues, many agree that the current Guides do not adequately inform consumers or effectively prevent misleading claims.

Past and future enforcement battles

Although the Guides have sparked many broader debates, the FTC's actual enforcement efforts have fluctuated over time.

The agency, along with seven states, sued Mobil Corporation for selling Hefty trash bags while claiming they were "degradable" under the action of light, air, and water. Mobil agreed to stop the advertising campaign and paid a $150,000 settlement in 1991 (before the Green Guides were issued). It was the first consent decree action over false environmental claims, but not the last.

The agency spent nearly a decade dealing with cases related to a plastic additive that manufacturers claimed made plastic biodegradable. In 2013, the FTC announced six enforcement actions, one of which included a $450,000 civil penalty.

But the FTC is not the only body using the Green Guides to push marketers toward compliance. The National Advertising Division (NAD)—an independent industry self-regulatory body affiliated with the BBB National Programs—also applies the Guides in its work.

"It's the advertising industry's self-regulatory effort to hold itself to industry standards, protect brands, not confuse consumers, and level the playing field so everyone knows the rules and operates in a clear and transparent way," says David Mallen. He spent 15 years as deputy director at NAD before entering private practice and is now an advertising and media lawyer at Loeb & Loeb.

NAD recently brought a case against American Beverage, requiring the organization to modify "certain aspirational claims about the use of recycled materials in its bottles, as well as claims involving ABA's collaboration with nonprofit partners and the joint achievement of sustainability goals."

As the FTC works on the next version of the Green Guides update, Shelton says many of her clients across the packaging value chain are highly focused on how chemical recycling will be treated.

"I think a lot of people are worried the FTC will make some kind of decision that destroys the industry, because that's where the industry is heading. Hard-to-recycle packaging and multilayer packaging are all moving toward chemical recycling," she said.

But she says that overall, clients do ensure strict compliance with the FTC's Green Guides, especially because the agency continues to bring actions based on serious violations.

"Our clients often treat it as law," Shelton said. "In my view, it works as intended, like having a school crossing guard." The guard is not a police officer, "but having someone who looks authoritative present often makes you behave."

As in the early '90s, state attorneys general are also weighing in on what changes they want to see. But given that the latest coalition of attorneys general are all Democrats, pushing the FTC to set a high bar for "recyclable" and to be cautious about chemical recycling, partisan politics may begin to play a larger role.

Looking ahead to the next round of Green Guides revisions, Mallen says it's important to remember that the agency's goal "is not really to achieve some specific environmental outcome, but to ensure consumers are not misled."

Therefore, transparency is the ultimate goal, even if it means not telling consumers what they want to hear.

"If you tell consumers, 'You have to take this to the store, otherwise it won't be recycled'—that may not be a good outcome for those worried about plastics in landfills," he said. "But at least you raise the bar for actual outcomes and expectations. Maybe the best advertising can ultimately do is be clear and transparent."

Visual editor Sean Lucas contributed to this article.

Correction:This article has been updated to correct the name of the nonprofit organization affiliated with the National Advertising Division.

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