If your business sells products that get some of their cachet from being green, natural, organic or locally sourced, you know that buzzwords like these can help you attract customers—and charge premium prices. But what do these terms really mean? Sometimes not much. Here’s what you should know before using popular “green” terms in your marketing, labeling or packaging.
According to the Environmental Protection Agency (EPA), there's currently no single U.S. authority that determines which products are "green," "greener" or "greenest." However, there are voluntary standards you can comply with to earn certification and/or eco-labeling for your products. (Eco-labels are seals you can display on your product packaging, marketing or website to show that you’ve met the standards.)
More and more eco-labels and standards are being developed to help consumers and businesses sort through often confusing product claims. Eco-labels and standards exist for everything from furniture, carpet, apparel and cleaning products to food, cosmetics and personal care products. You can search a database of EPA green product standards to find eco-labels and standards you may want to comply with for your industry and product type.
The Federal Trade Commission (FTC) has taken action against businesses when consumers complained that “green” marketing claims were false or misleading. Before making any claims in your labeling or marketing, read the FTC’s Green Guides. They explain how to ensure marketing claims about a product’s environmental attributes are honest.
Like “green,” “natural” is an extremely vague term. Neither the Food and Drug Administration (FDA) nor the U.S. Department of Agriculture (USDA) has developed a strict definition of the term to be used in food labeling. Under an informal FDA policy, the word can be used on food labels provided nothing artificial or synthetic has been added "that would not normally be expected to be in the food." The USDA has a definition for meat and poultry only: “A product containing no artificial ingredients or added color and only minimally processed (a process which does not fundamentally alter the raw product).” However, there is no certification process for this claim.
Fair Trade Certified
Perhaps most often used with coffee, Fair Trade certification can be obtained for numerous products, primarily food. The certification affirms that the product supply chain practices fair trade at every step—from the farmers or craftspeople to the surrounding community. Fair trade certification is meant to ensure safe working conditions, fair wages and environmentally responsible practices. The right to use the Fair Trade Certified™ label is granted by Fair Trade USA, the certifying organization that helps businesses get their products, businesses or supply chains certified or just find fair trade certified suppliers.
Restaurant owners know that locally sourced menu items are a hot ticket with customers. However, there’s no general agreement on what “locally sourced” means. The 2008 Farm Act defined locally sourced or regionally sourced as products being transported either 1) fewer than 400 miles from its origin or 2) within the state where it is produced. However, in 2007, the New Oxford American Dictionary defined a “locavore” as someone who tries to eat only food produced within a 100-mile radius. Clearly, the definition of “local” may also vary based on the population density of the area.
If you’re going to refer to food you sell as "locally sourced," you should provide specific details about the source, such as the name and location of the farm or manufacturer. Vague claims of local sourcing are likely to be met with skepticism.
Free Range/Free Roaming
Another term you may want to use on your restaurant menu, “free range” conveys happy visions of animals roaming free in the sun. Not really: The USDA does not regulate this term for beef or eggs (only for poultry), and its only standard is that the birds have access to the outdoors for five minutes a day. Chickens that are let out into a filthy cement parking lot for five minutes can qualify as “free range.” What’s more, there is no independent organization that verifies this claim.
If you’re going to claim products are “free range,” be sure you know what you’re talking about. If you have indeed visited the supplier and seen the conditions, feel free to make the claim—if not, it’s probably best not to.
Products that can be certified as organic include plants, textiles, personal care products or cosmetics, pet food and, of course, foods and beverages. The National Organic Program, overseen by the USDA, defines standards for organic certification and labeling. If you want to label or claim that products you produce or sell are organic, they must be certified by a USDA-accredited certifying agency.
There are different degrees of organic claims:
- For a product to be labeled “100 percent Organic,” 100 percent of the ingredients must be organic.
- For a product to use the USDA Certified Organic seal, at least 95 percent of the ingredients must be organic.
- In order to be labeled “Made With Organic Ingredients,” the product must have at least 70 percent organic ingredients and list up to three of them on the main ingredients label.
The USDA enforces its standards. If you knowingly use the USDA Certified Organic seal or USDA organic wording on a product that doesn’t actually qualify, you can be fined up to $11,000 per offense.
Businesses that sell less than $5,000 worth of organic agricultural products a year, retail businesses and restaurants are exempt from official certification. In other words, if you sell food made with organic ingredients in your restaurant, you don’t need to get your restaurant certified as organic. However, you need to be clear about whether the food is certified organic or just “organic” before putting that terminology on your menu.
There are some businesses that promote their products as organic without using the USDA certification or wording because they think the USDA’s standards aren’t strict enough. For example, the USDA organic standards allow food to be grown using naturally derived pesticides, and allow farm animals to be given antibiotics.
If you are or sell organic but don’t get certified, you should be transparent. Be ready to answer questions about your products and put information on your website and marketing materials.
The EPA defines sustainability as “[creating] and maintain[ing] the conditions under which humans and nature can exist in productive harmony [in order to fulfill] the social, economic and other requirements of present and future generations.” However, there is no universally agreed on definition, nor is there certification for sustainability.
That said, many business owners devoted to green practices believe that “sustainable” is actually a more meaningful term than “organic.” While organic products have to meet only the USDA’s rather limited definition to be certified, sustainable products are generally farmed or produced under conditions including:
- Conserving natural resources such as water, land and fuel.
- Small-scale production or farming that uses space efficiently.
- Using renewable energy sources to reduce fossil-fuel emissions.
- Ethical and humane treatment of animals and workers.
What to Do?
Do you need to get your products certified or eco-labeled? Investigate your options and assess the time and expense required. (Costs will vary depending on what you’re having certified, the certifying agency and the certification.) Weigh these against the potential benefits. For example, if getting certified is required to land a huge account, perhaps it’s worthwhile. If you prefer to sell on a smaller scale to local customers who already trust you without certification, then perhaps it’s not necessary.
Whether you choose to go through certification or simply make claims, the key is to make sure your claims can be substantiated, that you’re not making assumptions about your supply chain, and that you can provide details about what makes your products sustainable, green, natural or what-have-you to customers and partners. Nothing will violate trust more than false green claims that turn out to be “greenwashing.”
- EPA Greener Products guide to eco-labeling
- USDA’s Guide to Organic Marketing
- USDA list of accredited organic certifying agencies
- View a list of various eco-labels that can be obtained for personal care or cosmetics products.
- EPA Green Guides (summary)
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