BRAND NAME GREEN WASHING: REGULATORY GAPS AND TRUST MISPLACEMENT

ABSTRACT

Brands try to Greenwash their products by using words that are eco themed like “fresh” or “farm” even if the product is not truly sustainable. This trick leads to encouragement in consumers to pay more, country’s progress towards SDGs and deflates the value of genuine sustainable products. In India, laws focus on labelling and advertisements and overlook trade names. Advertising Standards Council of India recognises the problem, but it is self regulatory. This problem leads to distortion in the market and breakage of trust. Stronger rules and improved compliance standards and inspiration from international models can help in upholding fairness in the market.

INTRODUCTION

Think of a food product on a shelf. It is a synthetically made product with chemicals in it, but the brand name has the word “organic” as prefix. The assurance you get turns out to be bogus. This is an example of subtle green washing through branding. In the modern era where mindful consumption, sustainability and social responsibility are prioritized, brands try to project themselves as environmentally and health conscious. Green Washing is an attempt to capitalise on growing demand for environmentally friendly and organic products. Greenwashing is the process of making claims to deceive consumers into believing that the product they are manufacturing is environmentally sound.^[1]Most of the academic and legal discussions focus on green sheen through explicit claims such as “100% Organic” and “Eco-packed”, but subtle forms of it through branding gets very little attention. Companies choose brand names which imply sustainability, ethical process, and purity. Brand names with words like, “organic”, “farm” and “Nature”, which provide a positive perception in consumers are used. These brand names do not reveal the true nature of the product. Contemporary Indian laws do not address this grey area. Regulatory bodies like Food Safety and Standards Authority of India (FSSAI) and Advertising Standards Council of India (ASCI) look after labelling and advertising claims respectfully. These bodies do not treat brand names as claims itself. Companies use this loophole, presenting themselves with a sustainability narrative. This article explores how legal blind spots are exploited by companies. It examines eco themed branding practices that are overlooked by regulations.

BRAND NAME GREENWASHING: HOW IT WORKS?

Brands use the Health Halo effect where consumers assume a food product is healthy based on one positive claim or branding exercise. It is said that deserts with healthy or lighter sounding names are often chosen over their counterparts.^[2] Similarly, Green Halo effect is where consumers’ perception regarding environmental friendliness is affected by the use of green imagery and eco symbols. People rate that the products are better tasting, believe it’s healthier and are willing to pay more when food items are labelled as “eco-friendly”.^[3] Uncertainty of decisions is reduced with logos, sound, colours and names. Science behind name signalling and colour semiotics are effectively utilised by companies. For example, Colours like green and blue create a perception that food is healthier than red.^[4] There is no ethical issue when colours and other images are used, the real problem arises when companies use words like “From the farm” as a brand name which misrepresents the actual nature of the food product. Such eco theme brand names create emotional trust. It can be seen as a low cost and high marketing tool where a brand name in itself can bring green identity without having a burden of compliance or regulatory scrutiny.

LEGAL POSITION IN INDIA

According to the FSSAI regulations 2020, Food labels of prepackaged food must not be false, deceptive or misleading or likely to create a wrong impression about its character.^[5] It is also said that the package must carry a name that represents the product’s true nature. An additional fanciful, brand name can be included.^[6] But if adjectives like “natural”, “fresh”, “pure”, “original”, “traditional”, “authentic”, “genuine”, “real” are used, which mislead the consumer, a disclaimer in not less than 3mm size must be added on the label stating that – “*This is only a brand name or trade mark and does not represent its true nature”.^[7] These regulations give out the idea that claims must not mislead, but brand names escape such scrutiny. FSSAI has tightened the rules and said that the term “100%” is not defined. It directed companies to discontinue the claim on labels and packaging.^[8] However this advisory did extend to eco themed brand names.

Section 2(28), Section 89 of Consumer Protection Act, 2019 discusses misleading advertisements. When advertisements describe a product inaccurately or make false promises, the penalties can go up to 2 years of jail time and fine up to 10 lakhs for the first offense. If the offenses are repeated, it may lead to imprisonment for a term that may extend up to 5 years and fine up to 50 lakhs. These enforcement focuses and targets advertising contents. These stringent regulations do not attract CCPA.^[9]

Advertising Standards Council of India (ASCI) requires that the advertisements be truthful and legitimate. ASCI recognises Environmental or Green claims, and states that these claims can be made through marketing material, advertisements and most importantly branding or trading names. But ASCI is a self regulatory body, it can issue advisories but lacks penalty powers.^[10] Even though ASCI recognises that the brand name can lead to consumer interpretation, statutory enforcement is absent.

IP LAW (TRADEMARKS ACT, 1999)

Trademark law in India serves the purpose of providing an identification to brands and creating a distinction. With the help of trademark law, the owner is granted exclusive rights for using the mark and protects the owner from unauthorised use. It is an important aspect in creating a brand identity, build trust with consumers. Trademarks are registered under Trademarks Act, 1999. However, it is considered as just a mark for identification and does not convey the attributes of the product.

SECTION 9(1)(b)

According to this section of Trade Marks Act, 1999, a trademark can be refused to get registered if the name does not have distinctiveness. A trademark can be refused if the name describes the quality, purpose or kind of product. For instance, names like “Herbal Tea” can be rejected but a name like “HerbaEarth” can be used. Creative names can be used even if they don’t mean the same.

SECTION 9(2)(a)

This section prohibits registration of brand names that may cause confusion or deceive consumers in any way. This does not allow brands green washing in theory, practical challenges like lack of consumer awareness and enforcement result in the situation. Application of this section is limited when the claim is general and subjective. Stricter enforceability is necessary to reduce this gap in the marketplace.^[11]

CONSUMER IMPACT AND ETHICAL CONCERNS

MISALLOCATION OF CONSUMER SPENDING

Brand names with eco themed words lead to price hikes, as consumers tend to spend more on brands which are labelled as environmentally and health conscious. For example, a packed wheat flour branded, “G-Organix” can command a higher price when compared to rival packed flours. This is because of the eco narrative that the brand has. This disturbs the market fairness. There is a chance of diverting the expenditure from genuine organic products.

EFFECT ON CONSUMER TRUST AND ETHICAL RESPONSIBILITY

Trust in the market may erode because of the false projection and puffery. Because of rising green washing concerns, scepticism towards genuine organic and sustainable brands may rise. Trust fatigue may arise in consumers.

Greenwashing through brand name is not legally wrong or considered statutorily wrong, it raises moral questions. Companies try to capitalise on the consumers’ inclination towards environment and health related products. Though manipulation using consumer psychology is technically legal, it reduces transparency.

SUSTAINABLE CONSUMPTION GOALS

India is ambitious about meeting Sustainable Development Goals set by the United Nations. SDG 12 deals with responsible consumption and production. This goal mainly focuses on reducing waste, promoting consumer awareness and encouraging sustainability in manufacturing or production. Greenwashing through brand names disturbs these aims by misleading and misinterpreting regarding sustainability. This lack of consumer information leads to mislocation of consumer demand. This deflates the value of certifications for proving sustainability of genuine brands and trust deficit is created. Government’s policy initiatives regarding sustainability gets weakened because of the green narrative that companies use through brands.

REFORMS AND REMEDIES

STRENGTHENING CONSUMER PROTECTION LAWS

Consumer Protection Act currently focuses on misleading advertisements, there is a need for expanding scope of law to look after brand names as well. Amendment or update defining brand name, misrepresented brand name and extension of penalty structure of CCPA towards trade names can build fairness and increase transparency in the market. A mandate which necessitates evidence for eco themed claims and brand names ensures accountability and prevents green sheen.

ASCI ENHANCEMENT

ASCI already recognises the green washing practices through advertisements and trade names. Advisories are formed on the idea that there is a possibility of misinterpretation about the nature and form of a product on the basis of brand name. ASCI guidelines for Advertisements Making Environmental / Green Claims states the same.

The main problem with ASCI is that the body is self regulatory. It does not have power to penalise companies for the green washing. A change can be brought to market if FSSAI and CCPA take ASCI guidelines officially and recognise them. If ASCI finds problematic in the market, these statutory bodies can take a stronger legal action and penilise for the same. ASCI and FSSAI could publish a public list with names and words that need to be backed with evidence. A layered hybrid compliance mechanism can really bring in responsible production.

INTERNATIONAL LESSONS

For the promotion of transparency and curbing green sheen, the European Union bought in a landmark regulatory initiative, EU’s Green Claims Directive (2023). According to the Green Claims Directive, Explicit and implicit environmental claims are recognised under this directive. According to this, evidence must be presented where companies provide clear, scientific evidence to support environmental claims. The substantiating evidence must be independently verified before the claims become public. The importance for transparency is understood here. Most importantly, Green Claim Directive extends its jurisdiction towards trade names along with advertisements and labelling. This directive ensures credibility, accountability and transparency.^[12] Adoption of a similar model enhances market fairness.

CONSUMER AWARENESS

There could be several changes in the judiciary system and commercial markets, but it is important for consumers to be informed. Consumers must look at more than just brand names and packaging. It is important to look upon facts rather than uncertified claims. There is a need for rational and logical thinking about the price differences and be cautious about misinterpretations. Staying informed and critical thinking makes consumers take decisions which are reasoned.

CONCLUSION

Greenwashing through trade names is not just a PR game, it is a systematic problem which affects consumer awareness and trust. This misleading and misrepresentation through eco themed brand names can disrupt market certainty by exploiting consumers’ inclination towards sustainability. Manipulation and deception of psychology undermines informed decision making ability of consumers. Even though this green sheen is legally correct, they violate ethical boundaries and responsible production practices. Over time it disrupts the market and affects India’s progress towards SDG 12.

Corporates strategize legal insufficiency to leverage consumer vulnerability. Statutory bodies like FSSAI and CCPA and rules levied by them only focus on advertisements and labeling and overlook brand names. This creates a legal grey area. Though ASCI has acknowledged the deception through brand name, it is self regulatory. It does not have power to penalise companies for it. In India, Trademarks law was designed to prohibit deceiving brand names, but it falls short of practical applicability.

To bring change, there must be reforms, both institutionally and behaviourally. Institutionally, statutory bodies must take up ASCI guidelines and enforce them for upholding transparency. A 3 fold compliance mechanism facilitates a fair marketplace. EU Directives regarding the same shows the successful application of institutional guidelines.

Human desire is the basis of business and this seeks possible opportunities. This is the same place where the idea of Greenwashing is born. But it is important for companies to prioritise honesty and integrity over tricks. Companies must do what is right to do rather than what is allowed to do. Brand name tricks look subtle and simple but it leads to money wastage and misleading choices and most importantly it breaks trust. It is the responsibility of every entity in the market to protect the trust. A fair market can only thrive with honestly and truth.

REFERENCES

^[1] Adam Hayes, ‘Greenwashing: Definition, How It Works, Examples, and Statistics’ (Investopedia, 2025) https://www.investopedia.com/terms/g/greenwashing.asp accessed 19 July 2025.

^[2] ‘The Health Halo: How Good PR Is Misleading Shoppers’ (The Guardian, 11 March 2015) https://www.theguardian.com/sustainable-business/2015/mar/11/know-what-you-eat-health-halo accessed 19 July 2025.

^[3] Patrik Sörqvist and others, ‘The Green Halo: Mechanisms and Limits of the Eco-Label Effect’ (2015) 43 Food Quality and Preference 1.

^[4] Kosuke Motoki and Achal Pathak, ‘The Length of Brand Names Influences the Expectation of Healthiness in Foods and Preference for Healthy Foods’ (2023) 40 Psychology & Marketing 1850.

^[5] Food Safety and Standards (Labelling and Display) Regulations 2020, reg 4(3).

^[6] Food Safety and Standards (Labelling and Display) Regulations 2020, reg 5.

^[7] Food Safety and Standards (Advertising and Claims) Regulations 2018, reg 4(7).

^[8] A 100% No Food Labels Sent Packing: FSSAI Asks Food Companies Not to Make False Claims of Absolute Purity’ (The Economic Times) https://economictimes.indiatimes.com/industry/cons-products/food/a-100-no-food-labels-sent-packing-fssai-asks-food-companies-not-to-make-false-claims-of-absolute-purity/articleshow/121497479.cms accessed 19 July 2025.

^[9] Consumer Protection Act 2019.

^[10] Advertising Standards Council of India, Guidelines for Advertisements Making Environmental/Green Claims (ASCI).

^[11] Trade Marks Act 1999.

^[12] J MacLennan and W De Catelle, ‘The Revision of EU Greenwashing Laws: A New Framework of Analysis’ (2025) Business and Human Rights Journal 1.