Clorox Copped $8.25M Fine: Greenwashing Claims Hit Aussie Consumers’ Pockets

Aussie consumers need to be more alert than ever when it comes to environmental claims made by companies. In a recent landmark case, Clorox Australia (Clorox) has been hit with a hefty $8.25 million penalty for misleading customers about the environmental credentials of some of its products. This case, pursued vigorously by the Australian Competition and Consumer Commission (ACCC), serves as a stark warning to businesses and an important lesson for consumers navigating the often-murky waters of “green” marketing.

The Federal Court Ruling: What It Means

The Federal Court has officially approved the $8.25 million penalty, sending a clear message that greenwashing – the practise of exaggerating or falsely claiming environmental benefits – won’t be tolerated in Australia. The Court’s decision requires Clorox to:

1. Pay the $8.25 million penalty.
2. Establish and implement an Australian Consumer Law (ACL) compliance programme within 90 days, at its own expense, for a period of 3 years. This programme will require:
   • Updates to Clorox’s existing compliance policies to ensure a commitment to compliance with the ACL.
   • Clorox to issue an internal policy statement confirming its commitment to compliance with the ACL.
   • Clorox to take certain steps to realise its commitment to compliance.
   • Clorox Australia to require all local personnel to report any ACL non-compliance issues or concerns of which they become aware to the Compliance Officer (Clorox Australia’s Company Secretary).
3. Publish a corrective notice within 14 days addressing its violations of the ACL; and
4. Pay $200,000 towards the ACCC’s costs.

The Court, in deciding on the penalty amount, considered the “French factors,” a set of legal principles used to determine appropriate penalties in cases of breaches of consumer law. These factors consider elements like the seriousness of the conduct, the size of the company, and the need to deter similar behaviour by other businesses. The Court was satisfied that the $8.25 million penalty was appropriate to specifically deter Clorox, and generally deter other organisations from similar conduct.

Greenwashing and the Property Market: A Growing Concern

While this case directly involves consumer goods, the principles are highly relevant to the Australian property market. “Green” building materials, energy-efficient appliances, and solar panel installations are increasingly marketed as key selling points for both new and existing properties. However, consumers need to be cautious and ask the right questions. Are the claims accurate and verified? Is the product or service actually delivering the promised environmental benefits?

Spotting Greenwashing in Real Estate

• Vague Claims: Be wary of terms like “eco-friendly” or “sustainable” without specific details or certifications. Ask for quantifiable data and independent verification.
• Misleading Certifications: Research the certification bodies and ensure they are reputable and relevant to the claims being made. Some certifications have stricter standards than others.
• Cherry-Picking: A company might highlight one environmentally friendly aspect while ignoring other less sustainable practices. Look at the overall environmental impact.
• Lack of Transparency: If a company is unwilling to provide detailed information about their environmental practices, it’s a red flag.

Consumer Rights and the Australian Consumer Law (ACL)

The ACL protects consumers from misleading and deceptive conduct. This includes false or misleading claims about the environmental benefits of products or services related to property. Some core provisions of the ACL related to this issue are:

• Section 18: A broad prohibition against engaging in conduct that is misleading or deceptive or is likely to mislead or deceive.
• Section 29: Prohibits false or misleading representations about goods or services, including their characteristics, uses, or benefits.

If you believe you have been misled by a business regarding environmental claims for a property or related products/services, you have the right to:

• Seek redress: Contact the business directly to request a refund, replacement, or repair.
• Lodge a complaint: File a complaint with the ACCC or your state/territory fair trading agency.
• Take legal action: In some cases, you may be able to pursue legal action against the business.

Protecting Yourself: Tips for Property Consumers

Here’s how to stay protected when navigating the property market:

• Do Your Research: Investigate the environmental claims of products and services before making a purchase.
• Ask Questions: Don’t be afraid to ask businesses for detailed information and supporting evidence.
• Get it in Writing: Ensure all environmental claims are documented in your contract or agreement.
• Seek Independent Advice: Consult with building inspectors, energy auditors, or other experts to verify environmental claims.
• Be Skeptical: If something sounds too good to be true, it probably is.

Resources for Consumers

• Australian Competition and Consumer Commission (ACCC): The ACCC enforces the ACL and provides information and resources for consumers. Their website (accc.gov.au) is a great starting point.
• State and Territory Fair Trading Agencies: Each state and territory has a fair trading agency that handles consumer complaints and provides advice. Check your local government website.
• Consumer Affairs Australia and New Zealand (CAANZ): CAANZ represents consumer protection agencies across Australia and New Zealand.

The Bigger Picture: Promoting Genuine Sustainability

The Clorox penalty highlights the importance of holding businesses accountable for their environmental claims. By demanding transparency and verifying information, consumers can drive demand for genuinely sustainable products and practices, both in the property market and beyond. It is important to note that enforcement of greenwashing claims is an evolving area, and we can expect more action from the ACCC in the future.

Source: https://www.twobirds.com/en/insights/2025/australia/update-court-approves-penalty-and-orders-costs-against-clorox

This article is based on a report from www.twobirds.com titled “Update – Court approves $8.25 million penalty and orders costs against Clorox for greenwashing marketing practices.”. You can find the original article here: https://www.twobirds.com/en/insights/2025/australia/update-court-approves-penalty-and-orders-costs-against-clorox