CMA guidance on green credentials reinforces sustainability accountability in global supply chains
Environmental claims – asset financiers, manufacturers and others in the supply chain need to pay attention to sustainability messaging in respect of those assets.
Those operating in the asset finance market will be particularly interested to note a recent development on how certain assets are marketed by reference to their purported sustainability and ‘green’ credentials. If not properly and accurately identified, this could be the source of new environmental claims.
We examine the Competition and Markets Authority (CMA)’s new guidance and what it means in terms of accountability for those in the asset finance and supply‑chain.
On 22 January 2026, the UK regulator, the CMA that ensures that competition is promoted in the UK economy, issued new guidance (the Guidance) to reinforce how environmental statements should be made and substantiated across assets in supply chains.
The Guidance is intended to be read in conjunction with the CMA’s Green Claims Code, which offers detailed guidance to businesses on how to comply with the law when making environmental claims about products and services.
The Guidance clarifies where responsibility for environmental statements lies at each stage of the supply chain and reiterates that misleading green statements remain a key area for CMA enforcement.
Environmental statements: what counts?
Environmental statements are not limited to written statements. They include, for example:
- website and marketing descriptions of a product’s environmental credentials;
- packaging statements (e.g. “compostable”, or “made from recycled content”);
- the use of green imagery, symbols or logos suggesting environmental benefit; and
- omissions that withhold important information needed for consumers to make an informed decision.
Importantly, businesses may be deemed to make an error which may lead to an environmental claim simply by stocking a product that displays such an inaccurate, false or misleading statement. If such statement is false or misleading, retailers, as well as manufacturers, may be held liable. It is therefore incumbent on all operators in a supply chain to perform proper due diligence on the asset and all those that have been or are in the supply chain to the end user customer.
Shared responsibility across the supply chain
The Guidance reinforces that every business in the supply chain has a role in ensuring that environmental statements are accurate. Any evidence to support this must be credible, relevant and up to date. If businesses cannot access the information needed to verify such statement, the CMA expects it to reconsider whether that statement should be made at all.
Where another business is the source of the statement and will not or cannot verify it, the Guidance suggests that businesses may need to re-consider supplier relationships.
The Guidance also emphasises that misleading environmental statements may be unlawful even where the business did not intend to mislead. Innocent mistakes are still breaches, and it is also not a defence for businesses to argue that it exercised all due diligence and took all reasonable precautions to avoid making the misleading statement.
Enforcement powers and priorities
The Guidance clarified the CMA’s approach to consumer law enforcement. Following the introduction of the Digital Markets, Competition and Consumers Act 2024 (which came into effect in April 2025), the CMA can determine whether consumer law has been infringed and issue fines to non-compliant businesses, without needing to go to court.
The CMA will prioritise cases based on factors such as:
- the strategic importance of intervention;
- the likely impact of action on consumers and markets; and
- which businesses in the chain have engaged in the commercial practice.
This underscores the importance of businesses having adequate internal processes in place for verifying environmental statements.
Practical implications for supply chains
The Guidance includes a detailed checklist for retailers, brands and suppliers, intended to clarify the CMA’s expectations across supply chains when making or relying on green statements. Themes include:
- Evidence gathering: Ensuring robust, credible, and up‑to‑date evidence is available before statements are made or relied on.
- Supplier engagement: Seeking evidence from suppliers to verify green statements, or confirmations such as via self‑assessment, if full evidence is not available.
- Internal processes: Establishing systems to verify green statements made and training staff responsible for sustainability messaging.
- Ongoing review: Regularly reassessing statements and documentation to ensure statements remain accurate. This could include carrying out spot-checks.
- Avoiding casual statements: Avoiding making informal or vague environmental statements that could be interpreted as verifiable without having the evidence to back them up.
Conclusion
The Guidance reinforces that credible sustainability requires rigorous evidence, transparent communication and collaboration across supply chains. As environmental statements play a growing role in shaping brand trust, businesses must ensure their messaging is grounded in verifiable facts, and that they request and retain any evidence to support their assertions.
Our Banking & Finance experts can support lenders, borrowers and asset financiers by helping them assess, evidence and manage green credentials across transactions and supply chains, reducing regulatory risk while ensuring sustainability claims are robust, compliant and commercially workable.
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