The Federal Court has ordered Clorox Australia Pty Ltd to pay $8.25 million in penalties for making false and misleading claims about the environmental credentials of its GLAD kitchen and garbage bags. The ruling follows enforcement action by the Australian Competition and Consumer Commission (ACCC).

Between June 2021 and July 2023, Clorox marketed its GLAD to be GREEN “50% Ocean Plastic Recycled” Kitchen Tidy Bags and Garbage Bags as being made from at least fifty percent recycled plastic waste collected from the ocean or sea. In reality, the products contained approximately fifty percent plastic waste gathered from communities in Indonesia without formal waste management systems, located up to fifty kilometres from a shoreline. The remainder was made up of non-recycled plastic, processing aid and dye. More than 2.2 million units were sold in this packaging during the period.

“Claims about environmental benefits matter to many consumers and may impact their purchasing behaviour. When those claims are false or misleading, this is a serious breach of trust, as well as the Australian Consumer Law,” ACCC Chair Gina Cass-Gottieb stated.

The Court found that elements of the GLAD product packaging – including its use of wave imagery, the phrase ‘50% Ocean Plastic Recycled’ and references to ‘green’ – were likely to give ordinary consumers the impression that the bags were made from plastic collected directly from the ocean and that the products offered meaningful environmental benefits. These design choices were ruled as “important contextual matters in assessing the contravening conduct.”

The Court also warned of the broader consequences of this type of misconduct, observing that “there is a particular societal harm that arises when conduct undermines consumers’ confidence in environmental claims.” It added that while developing products designed to reduce environmental harm is beneficial, those claims are only meaningful if they are accurate.

In addition to the financial penalty, Clorox has been ordered to establish an Australian Consumer Law compliance program, publish a corrective notice on its website, and contribute to the ACCC’s legal costs.

Clorox told INCLEAN that Glad Australia is committed to ensuring its packaging and marketing claims are accurate and backed by evidence. “GLAD Australia takes seriously its obligations to package and market its products with claims that are accurate and substantiated“

While the ACCC and the Court recognised that Glad did not intend to mislead consumers, we respect this outcome and see this as an opportunity to further enhance our practices and reaffirm our commitment to offering products that help reduce environmental impact and meet consumers’ evolving needs.”

The ACCC noted that Clorox cooperated with the investigation and legal proceedings, admitted the breaches, and jointly submitted proposed penalties and orders with the ACCC to the Court. The company discontinued the GLAD to be GREEN products in July 2023, after learning of the ACCC’s investigation and before proceedings commenced.

“We take allegations of greenwashing extremely seriously and will continue to monitor claims made by businesses and, where appropriate, will take enforcement action on misleading environmental claims,” Ms Cass-Gottlieb said.

She reinforced the ACCC’s broader warning to businesses making sustainability claims. “While the ACCC encourages businesses to innovate and offer environmentally sustainable products, businesses need to be clear and accurate when making representations about them. We take allegations of greenwashing extremely seriously and will continue to monitor claims made by businesses and, where appropriate, will take enforcement action on