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H&M and Decathlon committed to provide better information about sustainability as well as donate € 500.000

  • Netherlands
  • Consumer
  • Retail

21-10-2022

In the Netherlands two interesting ‘commitment decisions’ were published by the ACM (Dutch Authority for Consumers and Markets) in relation to incorrect sustainability claims resulting in commitments from both H&M and Decathlon to donate half a million euros.

The ACM sent out a letter in April 2021 to 170 companies in the Netherlands in relation to the (correct) use of sustainability claims, including letters to over 70 companies active in the fashion industry. This initiative follows the publication by the ACM of the Guidelines Sustainability Claims in January 2021. ACM has worded five rules of thumb for companies wanting to use sustainability claims. In short, the sustainability benefit must be clear, substantiated with up-to-date facts; claims re. efforts must be honest and specific, with comparisons being fair and visual claims and labels being useful and not confusing. One of ACM’s tasks is consumer protection and to ensure consumer information, including advertising, is correct, giving ACM the authority to follow up on complaints, investigate and impose fines in case of misleading information, advertising or claims.

In June 2021 the ACM followed up by starting an investigation into 10 companies in the fashion industry, which companies were chosen on the basis of their turnover in the NL. H&M and Decathlon are two companies which were subject of the sustainability claim investigation. Recently, ACM has published the commitment decisions for these companies, finding H&M’s use of the claims ‘Conscious’ and ‘Conscious Choice’ not sufficiently substantiated or lacking it, and also that the information given about H&M’s sustainability efforts in the product information, irrespective of the fact if the product at hand consisted of sustainability materials, created a wrong impression. As for Decathlon, the ACM concluded that the use of the term ‘Ecodesign’ lacking the specific sustainability advantage of the product, is misleading. For some products the sustainability claim is not or to brief. Also the sustainability filter named ‘Ecodesign’ is explained in a vague or unclear manner as the criteria for a product to be an Ecodesign are obscure. In addition, Decathlon uses a ‘Environmental labelling system’ using a score between A and E, for which the scores nor the classification criteria were substantiated.

This detailed investigation resulted in both companies obliged to make a commitment in order to avoid sanctioning. H&M and Decathlon have committed to:

  • informing consumers more clearly in order to minimize the risk of misleading practices involving sustainability claims.
  • make donations of € 400,000 and € 500,000 euros, respectively, to different sustainable causes to compensate for their use of unclear and insufficiently substantiated sustainability claims.

The ACM has published these decisions end of August, and we expect further decisions in relation to some of the other 8 companies that were investigated. We also suspect the ACM to broaden their horizon by looking in to other sectors as well as looking into fashion companies which may have less significant turnover but use sustainability claims which may be questioned. Considering the amounts both companies will donate, which in essence is similar to being fined, reconsidering the substantiation for sustainability claims made, might be worthwhile.