Published On: July 27, 2026
Authored By: Priyani dey
University of Allahabad
Abstract
With increasing environmental awareness among consumers, corporations now market their products or services as eco-friendly and sustainable. In reality, many of these claims are inflated or false. This practice, termed “greenwashing,” significantly harms the field of environmental sustainability and governance. Although India currently lacks a dedicated statute against greenwashing, several existing laws, including consumer protection and environmental legislation, address aspects of the problem. This paper explores the concept of greenwashing, its common forms, and the regulatory framework that has developed around it, particularly in India.
Keywords: Greenwashing, environmental law, consumer protection, ESG, environmental governance.
Introduction
Environmental sustainability has become an important issue, and consumer choice is increasingly compromised where organisations misrepresent their environmental credentials. Businesses routinely promote their products as “eco-friendly,” “sustainable,” “carbon neutral” or “environmentally safe.” While demand for sustainable products has grown alongside deteriorating environmental conditions, some organisations exploit this concern purely for marketing purposes rather than genuine environmental improvement.
“Greenwashing,” also known as “green sheen,” refers to misleading, exaggerated, false or unproven representations regarding the environmental practices of a product, service or corporate activity. It can be understood as a form of false advertising in which organisations seek to appear environmentally responsible in order to attract environmentally conscious consumers. In India, the absence of strict ESG (environmental, social and governance) disclosure requirements has allowed greenwashing to become relatively common. Some retailers, for instance, market dedicated “conscious” or “sustainable” clothing lines using materials such as organic cotton, reflecting a broader trend of environmental responsibility entering mainstream marketing, though such claims still require scrutiny to confirm they are substantiated rather than promotional.
The term “greenwashing” was first popularised by environmentalist Jay Westerveld in 1986. He criticised hotels that encouraged guests to reuse towels under the guise of environmental responsibility, while continuing environmentally harmful practices elsewhere in their operations.
Greenwashing has emerged as a serious legal and regulatory concern because it affects consumer rights, corporate accountability, market transparency and environmental justice.
Common Forms of Greenwashing
A. Vague Claims
Terms such as “natural,” “green,” “eco-friendly” and “environmentally safe” are often used without supporting scientific evidence.
B. Hidden Trade-offs
A product may be marketed as environmentally friendly on the basis of one positive feature, while significant environmental harm elsewhere is ignored.
C. False Certifications
Companies may display unofficial labels or misleading certifications to create a false impression of environmental compliance.
D. Irrelevant Claims
Highlighting compliance with existing legal requirements as though it were a special environmental achievement, when such compliance is already mandatory.
E. Misleading Carbon Neutrality Claims
Businesses may claim carbon neutrality through questionable offsetting practices, without making any genuine reduction in emissions.
F. Selective Disclosure
Companies may publicise limited sustainability achievements while concealing broader environmental violations.
Laws Regarding Greenwashing in India
Under the Draft Guidelines for the Prevention and Regulation of Greenwashing issued by the Central Consumer Protection Authority (CCPA), under the Ministry of Consumer Affairs, greenwashing is defined as deceptive or misleading activity in which a company makes false or exaggerated claims of environmental sustainability.
Although India has no dedicated statute on greenwashing, the issue is addressed through a series of legal instruments concerned with deceptive trade practices, aimed at protecting consumers and advancing environmental justice. Key legal instruments regulating greenwashing in India include the Consumer Protection Act, 2019, the CCPA’s Guidelines for Prevention and Regulation of Greenwashing, and various industry-specific regulations issued by bodies such as the RBI and SEBI.
Guidelines for Prevention and Regulation of Greenwashing, 2024
Recognising the growing concern, the CCPA released Draft Guidelines for the Prevention and Regulation of Greenwashing on 20 February 2024, and, following a public consultation process, notified the final Guidelines for Prevention and Regulation of Greenwashing or Misleading Environmental Claims, 2024 on 15 October 2024. The Guidelines regulate environmental claims in advertising, requiring businesses to support such claims with reliable scientific evidence. They also impose transparency requirements, obliging companies to make supporting information accessible to consumers, for example through QR codes or links on packaging.
Advertising Standards Council of India
The Advertising Standards Council of India (ASCI) regulates advertisements in India, among other functions. In relation to greenwashing, ASCI has issued “Guidelines for Advertisements Making Environmental/Green Claims,” commonly known as the “ASCI Green Guidelines,” applicable from 15 February 2024. These guidelines are intended to curb greenwashing among advertisers and ensure that environmental claims made in advertising are accurate and credible.
Consumer Protection Act, 2019
The Consumer Protection Act, 2019 is one of the most significant legal tools available against greenwashing. Section 2(47) of the Act broadly defines “unfair trade practice” to include misleading representations concerning the quality of goods or services. The Act empowers authorities to take action against such practices, ensuring that consumer rights are protected.
Reserve Bank of India (RBI)
The Reserve Bank of India has addressed greenwashing in the financial sector through its “Framework for Acceptance of Green Deposits.” This framework requires financial institutions to substantiate their environmental claims when offering green investment products, helping prevent institutions from labelling financial products as “green” without adequate evidence of environmental impact, and thereby strengthening consumer trust in such products.
Companies Act, 2013
The Companies Act requires certain corporations to allocate a proportion of their profits to Corporate Social Responsibility (CSR), which is intended to improve the social and environmental impact of business activity. Separately, BIS certification is required to substantiate the authenticity of many products; marketing a product with eco-labels without meeting applicable BIS standards may attract legal consequences. Relevant provisions under the Act include the following:
Directors owe fiduciary duties to the company. Corporate reports must provide accurate information. False statements in such reports may give rise to liability. Misrepresentation of sustainability initiatives in annual reports may accordingly attract legal consequences.
SEBI Regulations and ESG Disclosures
The Securities and Exchange Board of India (SEBI) has strengthened ESG disclosure requirements through the Business Responsibility and Sustainability Reporting (BRSR) framework, which requires listed companies to disclose sustainability-related performance in a standardised format.
Legal Repercussions of Greenwashing
Greenwashing may give rise to several forms of liability.
A. Consumer Liability
Consumers may initiate complaints regarding misleading advertisements and unfair trade practices.
B. Regulatory Liability
Regulatory authorities may impose penalties, order corrective disclosures, or restrict advertisements found to be misleading.
C. Civil Liability
Investors and consumers may seek compensation where they have suffered losses as a result of false environmental representations.
D. Corporate Governance Liability
Directors and officers may face scrutiny for inaccurate sustainability reporting.
E. Reputational Damage
Beyond formal legal sanctions, greenwashing can significantly damage corporate reputation and investor confidence.
Recommendations
To strengthen regulation against greenwashing in India, the following measures may be adopted: enacting dedicated anti-greenwashing legislation; establishing standardised definitions for environmental claims; strengthening ESG auditing requirements; increasing penalties for misleading environmental advertisements; and improving consumer awareness regarding sustainability claims.
Conclusion
Overall, greenwashing continues to pose a significant challenge in India, given the heightened interest in ESG issues. Increased legislative attention to climate change has not yet translated into comprehensive anti-greenwashing legislation, and the practice remains widely used by businesses seeking to profit from the deceptive marketing of their products as environmentally friendly. Although greenwashing is not itself classified as a criminal offence, it is recognised as a form of unfair trade practice.
By misleading both consumers and investors about the environmental performance of companies, greenwashing undermines the principles of sustainable development and erodes public trust in environmental regulation. Despite an existing legislative framework spanning consumer protection law, environmental law, advertising regulation and ESG rules, recent measures such as the CCPA Guidelines on Greenwashing represent a significant step toward greater transparency. As sustainability continues to grow in importance within economic and environmental policy, further improvements to India’s legal framework will be necessary.
References
Consumer Protection Act, 2019.
Guidelines for Prevention and Regulation of Greenwashing or Misleading Environmental Claims, CCPA, 2024.
Companies Act, 2013.
Advertising Standards Council of India (ASCI), Guidelines for Advertisements Making Environmental/Green Claims.
S&R Law, ‘Greenwashing: An Overview’ <https://www.snrlaw.in/greenwashing-an-overview/>.
