Bill C-59: Strategies to avoid greenwashing in Canada

Understanding Bill C-59

Bill C-59, also known as the Fall Economic Statement Implementation Act 2023, introduces significant changes to the Competition Act. The amendments mandate that any environmental claims made by businesses must be substantiated with rigorous evidence. This means that companies can no longer make vague or unverified statements about their environmental impact; they must now provide proof in the form of disclosures aligned with internationally recognized methodologies.

The impact of Bill C-59 on environmental claims

Bill C-59 represents a significant shift in how environmental claims must be handled by businesses in Canada. The legislation requires that any environmental statements, whether about products or broader corporate practices, be backed by credible, verifiable evidence. This is a direct response to growing concerns about greenwashing, aiming to ensure that companies’ environmental messaging is both accurate and honest.

Key requirements:

• Product claims: These are specific statements about the environmental benefits of products, such as reduced carbon emissions or sustainable materials. Companies must ensure these claims are supported by rigorous tests and verifiable data.
• Business claims: These involve broader assertions about a company’s overall environmental practices, such as commitments to being “carbon-neutral”. These claims must be substantiated using internationally recognized methodologies.

The amendments place significant responsibilities on businesses to reassess their marketing strategies and ensure compliance. The penalties for non-compliance, including potential fines and loss of revenue, are severe, underscoring the importance of accurate environmental claims.

Leveraging data-driven strategies and technology

In navigating the complexities of Bill C-59, using data-driven strategies and technology is essential. Accurate, audit-grade data is the foundation of credible environmental claims, ensuring compliance and positioning companies as leaders in sustainability. Despite the lack of specificity in the amendment, businesses can mitigate the risk of greenwashing using internationally recognized standards. Data management platforms play a critical role by automating the collection, verification, and reporting of ESG data, making compliance with Bill C-59, more efficient and reliable. Regular monitoring and updates to environmental claims further enhance accuracy and credibility, reinforcing a company’s commitment to transparency and proactive climate action.

Preparing for Bill C-59: Key steps for Canadian companies

To navigate the requirements of Bill C-59, Canadian companies should take proactive measures to ensure their environmental claims are accurate, transparent, and compliant. Here are six steps companies can take to prepare:

• Conduct a comprehensive audit: Review all existing environmental claims and marketing materials to identify any potential risks of non-compliance.
• Develop robust data management systems: Implement advanced data management platforms to support in the collection, verification, and reporting of ESG data.
• Engage with compliance experts: Consult with professionals to interpret the specifics of Bill C-59 and align your practices with its requirements.
• Train employees on compliance: Provide targeted training for employees in marketing, product development, and compliance to ensure they understand the new regulations.
• Adopt internationally recognized standards: Utilize recognized standards for substantiating environmental claims.
• Establish ongoing monitoring and reporting: Set up regular compliance checks and continuously update environmental claims to reflect the latest data and regulatory guidance.

Uncertainties surrounding the guidance

Despite the clear direction provided by Bill C-59, there are still areas of uncertainty. For instance, the Act references “internationally recognized methodologies” without providing specific definitions. This leaves companies navigating a complex landscape of competing standards and certification processes. The Canadian Competition Bureau has acknowledged these challenges and plans to release further guidance later this year. In the meantime, companies should focus on managing legal risks by reviewing and revising any claims that could be subject to scrutiny under the new amendments​.

Building trust and long-term value with Bill C-59

Bill C-59 marks a pivotal moment for Canadian businesses, transforming the regulation of environmental claims into an opportunity for leadership in sustainability. By embracing data-driven strategies, leveraging technology, and committing to transparency, companies can navigate the challenges of greenwashing while building trust and long-term value. This proactive approach not only ensures compliance but also positions businesses as leaders in the global sustainability movement, opening doors to new opportunities, partnerships, and investments. Companies that view these changes as opportunities for growth will thrive and drive meaningful industry impact.

Position Green and Shift Critical International: Powering your ESG compliance

Position Green, in partnership with Shift Critical International, offers a comprehensive solution to meet the demands of Bill C-59 and ensure your environmental claims are fully compliant. Our platform, built by sustainability experts, automates your compliance process, streamlines data management, and powers your ESG strategy with robust, audit-ready data. Combined with Shift Critical’s deep expertise in compliance and sustainability, our partnership provides you with the tools and guidance needed to confidently navigate mandatory reporting in Canada, substantiating your claims and building trust with stakeholders.