Communicating future ambition and net zero – how to avoid greenwashing

Much of the attention on greenwashing focuses on specific claims, often at the product or service level with claims such as ‘our nappies are sustainable’. These focus on the specific sustainability impacts of something that already exists.

But what’s important when looking into the future? How can companies ensure that they minimise their greenwashing and wider reputational risks when it comes to expressing sustainability ambitions, commitments, and future intentions?

Setting long-term or forward-looking targets is an important part of best practice in sustainability management and sustainable transition. A firm seriously engaging with sustainability should be planning for significant changes in business models, activities and sustainability performance and setting appropriate and meaningful targets that describe these desired changes. Over time they should be disclosing their success, or otherwise, in achieving them.

But how do you do this and remain on the right side of the law? We explore this below through the lens of the different regulatory requirements in the UK.

The core position across all three regulators

The main UK regulators (CMA, ASA & FCA) work together closely to tackle greenwashing, and convergence across the three means that a claim that fails one framework is increasingly likely to attract scrutiny from the others.

The regulators do not discourage communicating long-term sustainability ambitions. All three apply the same fundamental requirements, that the gap between current reality and future aspiration must be honestly disclosed, and that an organisation’s ambition for sustainability must be backed by a credible plan. Intent on its own is not sufficient.

The CMA has explicitly confirmed that the same standards apply to both carbon-related sustainability claims and for wider ambitions on other topics , for instance, on nature, water, circularity and social impact.

What the claim must do

A communicated sustainability target or ambition must:

• Clearly differentiate between current achievements and future commitments. Conflating or blurring the two is seen as misleading.
• Clearly define the scope, what emissions, activities, parts of the value chain, or business operations are covered, and crucially what is excluded.
• Be specific and measurable and disclose interim milestones. A single end-date without staged commitments is insufficient under both CMA and ASA guidance.
• Be supported by a credible delivery strategy, and critically, this must already be in place at the time of the claim.
• Disclose the current position honestly alongside the target. Presenting a future net-zero commitment without acknowledging current emissions levels creates a false impression.

On net zero and carbon neutral specifically

The ASA’s February 2023 CAP/BCAP guidance update, reinforced by CMA and FCA positions, requires that:

• ‘Carbon neutral’ and ‘net zero’ are not used interchangeably, they have different technical meanings, and consumers cannot be assumed to know or understand this.
• The role of offsetting versus actual emission reduction must be disclosed prominently.
• Claims must be regularly reviewed to ensure supporting evidence remains current for as long as the claim is being communicated.
• In high-emission sectors, the substantiation (proof) threshold is higher. Any credibility gap between claim and operational reality is treated as an aggravating factor by both the ASA and CMA.

The FCA’s additional requirements for regulated firms

The FCA anti-greenwashing rule applies to all FCA-authorised firms making any sustainability claims about any product or service, not only investment products with sustainability objectives. For those firms it adds:

• Claims must be consistent with the actual sustainability characteristics of the product or service, a firm cannot make corporate-level sustainability commitments that are materially inconsistent with the products it sells or finances.
• Claims must be complete, they should not omit or hide important information and should consider the full lifecycle of the product.
• Sustainability-related terms including ‘ESG’, ‘green’, ‘climate’ and ‘sustainable’ in product naming and marketing have been subject to specific naming and marketing rules since December 2024.

The supply chain dimension (CMA January 2026)

The CMA’s most recent guidance confirmed that long-term ambitions communicated across a supply chain face the same requirements as direct claims. A business that repeats a supplier’s sustainability target as part of its own positioning takes on responsibility for that claim’s accuracy, and systemic failures of governance around target-tracking are treated as an aggravating factor in any enforcement.

The practical three-part test

Taken together, the standards set by all three regulators can be distilled to three critical questions:

• Is the current position honestly disclosed alongside the ambition?
• Is there a specific, evidence-based plan with interim milestones for delivering the ambition?
• Would a reasonable consumer clearly understand the difference between what is true now and what is intended for the future?

Answering no to any of these means that the communication of the ambition is misleading, regardless of whether the underlying intent or ambition is genuine.