The peak body behind Australia's organics industry has called for companies to face harsher penalties for misleading claims as part of a a Senate inquiry into greenwashing.
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Australian Organics Limited (AOL) addressed the public hearing in Canberra on Friday, alongside farmers who spoke about the impact on their certified organic businesses.
There's concern unsupported claims about the sustainability of products are being used as a "marketing ploy", with the organisation's 2023 market report finding 33 per cent of shoppers had purchased an item falsely believing it was organic because of claims on the packaging.
An internet sweep by the ACCC in October and November 2022 found 57pc of 247 businesses examined had made "concerning claims about their environmental credentials", including claims which were vague, unclear, too broad, false or misleading.
While the ACCC indicated it would conduct further investigations, ask businesses to substantiate their claims and follow up with non-compliant cases, AOL argues the report hasn't managed to deter illegitimate "organic" claims on products.
The ACCC also published draft guidance to help businesses maintain best practice when making claims about their environmentally friendly status.
But AOL CEO Niki Ford said the consequences for mislabelling needed to be more severe and the guidelines strictly enforced, especially for repeat offenders.
"There are currently over 2,000 businesses in Australia claiming to be organic that are not certified, with no way for consumers to verify the authenticity of their claims," Ms Ford said.
"This jeopardises the efforts of producers who have gone through the rigorous third-party organic certification process, proving how they promote biodiversity and encourage soil regeneration with natural alternatives to synthetic fertilisers and pesticides."
