‘Greenwashing? Being a Benefit Corporation does not shield you from penalties’
Interview with Michele Bonsegna, a corporate criminal lawyer and member of the Executive Board of the Association of Supervisory Bodies
A green certification label? It is not enough to shield a company from accusations of greenwashing. The same applies to the definition of a ‘Benefit Corporation’. This is according to Michele Bonsegna, a corporate criminal lawyer and member of the Executive Board of Aodv231, the association of supervisory bodies.
Many companies choose to register as Benefit Corporations or obtain private certifications. Does this formal safeguard protect them from accusations of greenwashing?
‘Absolutely not. Many organisations describe themselves as “Benefit” or purchase labels from third-party certifiers, but certification merely captures a snapshot of the past. The certifier comes along today and documents what you have done up to yesterday, but from that moment onwards, the company must not neglect its internal organisational controls. What is needed is what I call ‘certification maintenance’: periodic checks and internal audits that demonstrate the ongoing operational excellence claimed. Without this practical evidence, calling oneself a ‘Benefit’ organisation or declaring ESG objectives without reporting on them exposes the company to serious challenges.”
What practical changes will the EU’s greenwashing rules bring for businesses?
‘It is now established that, when making an environmental claim, you must be able to demonstrate the excellence you attribute to yourself; otherwise, you risk providing the market with incorrect information. As a lawyer, I can say that I live and work by written evidence. Until recently, a formal report or a generic sustainability report might have sufficed; today, every claim must be substantiated with verifiable documents and technical data. The provision is set out in the Consumer Code, assigning a central role to the Competition Authority in penalising misleading communications. Whilst this does not, in itself, fall under the Criminal Code, a false claim made to the market or to shareholders becomes the basis for charges of false corporate communication.”
