Upward Push towards ESG Integration in California with the Publication of a New Bill on Environmental Advertising

As part of California’s growing momentum towards the integration of accurate and comprehensive ESG claims, the State’s governor approved a bill relating to environmental advertising. Indeed, the bill amends Sections 17580 and 17580.5 of the California Business and Professions Code and Sections 18015 and 42355.5 of, and to add Section 42355.51 to, the Public Resources Code. These amendments seek to eliminate deceptive and misleading environmental marketing claims in the state, particularly with regards to recycling.

The new law calls on the state’s Department of Resources Recycling and Recovery to issue standards on or before 01/01/2024 specifying what types of material types/forms are considered recyclable. The law will apply to all consumer goods and packaging sold in the state, with some exceptions (exceptions include any product or packaging that is manufactured up to 18 months after the date the department publishes its recycling standards or products, or packaging covered by other state recycling laws). As such, unless a product of packaging follows “statewide recyclability criteria and is of a material type and form that routinely becomes feedstock used in the production of new products or packaging”, the use of a “chasing arrows symbol” or any other symbol/statement indicating the product/packaging is recyclable, will be considered deceptive or misleading.

For now, this Bill only applies to products sold in California. Nevertheless, considering the important size of the consumer good market in California, it is expected that this law will have an impact at a national scale. Furthermore, it is likely that these amendments find themselves replicated in other states.

This Bill is considered as the nation’s strictest standard with regards to environmental advertising.

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