ULVR Unilever Plc

By Saabira Chaudhuri and Michael Susin

The U.K.'s competition authority has launched a probe into environmental claims made by Dove soap owner Unilever, marking the start of what the regulator indicated could be a broader crackdown on greenwashing by consumer products makers.

The U.K. Competition and Markets Authority said Tuesday that it has started a formal investigation into the London-based company's environmental claims about "a number" of its essential products including household cleaners and toiletries.

The investigation comes after the CMA in January launched a review of potentially misleading green claims made by consumer-goods companies. On Tuesday, it said that effort had "identified a range of concerns" and that new investigations into other companies may follow.

The CMA said its concerns about Unilever include language that is vague enough to mislead shoppers, ingredient claims that could exaggerate how "natural" a product is and recyclability claims that may not specify whether they refer to the product or packaging.

"The evidence we've seen has raised concerns about how Unilever presents certain products as environmentally friendly," said CMA Chief Executive Sarah Cardell. "We'll be drilling down into these claims to see if they measure up."

Unilever said it refuted that its claims are in any way misleading and that it was surprised and disappointed by the CMA's announcement. The company added that it plans to cooperate with the investigation.

The regulator hasn't yet decided whether Unilever has broken any consumer-protection laws and may still close the case without further action. It said other outcomes include getting Unilever to promise to change the way it operates and taking the company to court.

The investigation is a blow to new Unilever Chief Executive Hein Schumacher, who has made a point of shifting away from the company's previous wide-ranging focus on sustainability. While Unilever previously said all of its products needed to have an environmental or social purpose, Schumacher has narrowed that focus to certain key areas like climate and plastics.

The CMA, as part of its wider industry review, plans to analyze environmental claims about consumer-goods products online and in stores. It said it would focus on broad statements, including claims about a product being "sustainable" or "better" for the environment with no evidence, and about the use of recycled or natural materials in a product and how recyclable it is.

Regulators in the U.S. have also been working to better protect consumers from misleading recyclability claims and other claims they say are too vague. The Federal Trade Commission is in the process of updating its Green Guides, which serve as guardrails for companies making green marketing claims.

Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com and Michael Susin at michael.susin@wsj.com

(END) Dow Jones Newswires

December 12, 2023 06:38 ET (11:38 GMT)

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