In the business sector, there is often a conflict between the interests of business organizations in maximizing profits and the public’s interest in receiving complete, truthful, and non-misleading information about products that they purchase. A related area of concern is when products are heavily promoted as being environmentally friendly. This practice is known as “greenwashing.”
Your discussion should address the following questions:
- Identify what legal issues are involved in using greenwashing tactics to market products. Explain how this practice is regulated.
- Discuss from a business perspective, if the legal marketing of products as being “green” or “friendly to the environment” is an ethical practice. If so, what ethical theory would justify this type of marketing?
- If you were a marketing executive, would you support the practice of greenwashing? Explain why or why not.
UAGC | BUS670 | Week 06 | The Federal Trade Commission
Welcome to BUS 670, week six– the Federal Trade Commission. This week, your first discussion assignment will involve an analysis of environmental marketing practices. This type of business activity is regulated by administrative law under the Federal Trade Commission or FTC.
The general mission of this agency is to keep the US economy fair and free. To support this objective, the FTC is empowered to prevent unfair methods of competition as well as unfair or deceptive acts or practices. These broad powers allow it to regulate a wide range of business activities, including competition reduction or monopolies, price fixing, telemarketing, internet tracking, product warranties, consumer credit, debt collection, product safety.
The FTC also regulates deceptive advertising or business practices. To be considered deceptive, the activity must involve a material misrepresentation, omission, or practice that is likely to mislead a consumer who acts reasonably under the circumstances. It should be noted that in the US, statements of opinion, sales talk, or puffing, and statements that consumers can easily evaluate for themselves are not considered deceptive.
In the first discussion assignment this week, you are asked to address the issue of greenwashing, which is the marketing practice of making false or misleading statements about the environmental benefits of a product. Basically, companies are taking advantage of consumers who are concerned about the environment, which has become more of a concern in recent years.
However, if the positive environmental claims can be supported through research and evidence, then the marketing approach is valid, and there is no misrepresentation. Greenwashing and other misleading environmental claims can be difficult to identify. Therefore, the FTC website has a section on environmental marketing, which includes Green Guides. These provide guidance to both consumers and business organizations.
I hope you find this information useful in developing your first discussion assignment this week. Stay informed and make a difference.