LegalComplianceMarch 01, 2023

ASIC’s first greenwashing court case + 7 other greenwashing cases

ASIC has started its first lawsuit against greenwashing. ASIC alleges that a superannuation trustee offered “sustainable” investment options that misleadingly claimed to exclude investments in fossil fuels, alcohol and gambling.


ASIC alleged that Mercer Superannuation (Australia) Limited stated on its website that its 7 Sustainable Plus investment options excluded investments in companies involved in carbon intensive fossil fuels, alcohol production and gambling. However, ASIC alleged that members who took up the Sustainable Plus options had investments in companies involved in these “excluded” industries, e.g.,

  • 15 companies involved in extracting or selling carbon intensive fossil fuels, e.g., AGL, BHP, Glencore and Whitehaven Coal
  • 15 companies involved in producing alcohol, e.g., Budweiser, Carlsberg, Heineken and Treasury Wine Estates
  • 19 companies involved in gambling, e.g., Aristocrat, Caesar’s, Crown Resorts and Tabcorp

Seeking penalties

ASIC is seeking pecuniary penalties, injunctions to stop the misrepresentations, publication orders and declarations from the Federal Court. ASIC alleges that Mercer made false and misleading statements and its conduct could mislead the public.

Wider powers against superannuation trustees

This is also the first court case ASIC has brought after legislative changes enhancing its powers to pursue a wider range of superannuation trustee conduct.

What is “Greenwashing”?

Greenwashing is the practice of misrepresenting the extent to which a company, product, service or investment strategy is environmentally friendly, sustainable or ethical. It may involve exaggerated claims.

Tips to avoid greenwashing

Be specific. Give a realistic impression of environmental impact or sustainability. Make your advertisements (especially the headline) consistent with any disclaimers. Use clear, plain language. Only make claims you can prove. Only make claims in an appropriate context. Use current, complete information. Use our Advertising checklist and practical guide to check whether your marketing material is misleading due to greenwashing or other issues, e.g., price, comparisons, reviews.

More greenwashing cases

Check out our greenwashing case table. Here’s a partial sneak peek:

Case Summary Successful party Unsuccessful party Consequence
Volkswagen Aktiengesellschaft v ACCC (2021) ATPR ¶42-724; [2021] FCAFC 49 “Two mode software” used to cheat emissions standards tests ACCC Vehicle importer $125 million pecuniary penalty
Mitsubishi Motors Australia Ltd v Begovic (2022) ATPR ¶42-792; [2022] VSCA 155 Fuel consumption label complied with legal standard but was still misleading Buyer Car dealer and manufacturer Not yet decided (remitted to VCAT)
ACCC v Woolworths Group Ltd (2020) ATPR ¶42-693; [2020] FCAFC 162 “Biodegradable and compostable” disposable dishes and cutlery Supermarket ACCC N/A
Tlou Energy Ltd Claims: Carbon-neutral, Low emissions, Equal focus on clean energy, Environmental approval and solar capability ASIC Energy company $53,280 infringement notice penalty
Black Mountain Energy Limited “Net-zero carbon emissions”, but no progress on specific works, no funding, no detailed plan or modelling ASIC Energy company $39,960 infringement notice penalty
Vanguard Investments Australia Ltd Overstated claim to not invest in tobacco ASIC Investment manager $39,960 infringement notice penalty
Diversa Trustees Limited Overstated claims to exclude polluting or harmful investments ASIC Superannuation trustee $13,320 infringement notice penalty

ACCC’s internet sweep triggers deeper investigations

The ACCC is actively investigating multiple businesses for greenwashing in the packaging, consumer goods, food manufacturing and medical devices sectors. 57% of the 247 businesses reviewed in the ACCC’s greenwashing internet sweep made concerning claims about their environmental credentials or sustainability practices. The ACCC may launch more investigations as it continues to assess the businesses and claims identified in the sweep. The ACCC will ask businesses to substantiate their claims, if it has concerns. The cosmetic, clothing, footwear, food and drink sectors had the highest proportion of concerning claims. Many businesses made vague environmental claims.

Explore our interactive Misleading conduct case finder at ¶26-1000 on CCH iKnowConnect, our next-generation research platform for tax and legal professionals.

Check out our guide to corporate ESG reporting available as part of our Company Law practice area.

Free 7-day trials for CCH iKnowConnect are now available for your specific area of interest and practice area. Experience it for yourself today!

Rufina Law
Portfolio Lead, Wolters Kluwer
Rufina leads the Commercial Law portfolio, which covers company, competition and consumer, insurance, insolvency, contracts, privacy, intellectual property, and consumer credit law.
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