Canadian regulator launches greenwashing investigation into lululemon

May 16th, 2024

Competition Bureau Canada has begun an investigation into lululemon over allegations of greenwashing.

The investigation comes after stand.earth, an environmental advocacy organization, filed a complaint with the bureau claiming lululemon was using misleading language in its advertising.

The Competition Bureau, the consumer protection agency in Canada, reviews complaints and offers recommendations on whether the company could be charged with breaking the Competition Act.

The Competition Act ensures all companies have an opportunity to participate in the economy and provide consumers with competitive prices and product choices.

In 2020, lululemon, an athletic apparel company headquartered in Vancouver, launched its ‘Be Planet’ marketing campaign as part of its impact agenda.

The agenda included targets to have 100% of its products include sustainable materials, provide resell, repair, or recycle options to customers by 2025 and reduce carbon emissions intensity across the global supply chain by 60% by 2030.

However, stand.earth claimed lululemon’s 2022 impact report showed a 100% increase in climate pollution since deploying the slogan and said the company relies heavily on climate-damaging fossil fuels to make its products.

Rachel Kitchin, senior corporate climate campaigner at stand.earth, said: “Lululemon states that its ‘products and actions avoid environmental harm and contribute to restoring a healthy planet,’ however, its products are made in factories that burn coal for energy, and are made in countries including Vietnam, Cambodia, and Indonesia that rely heavily on fossil fuels to power their production.”

The fast fashion industry produces greenhouse gas emission equivalent to 1.2 billion tonnes of CO2 per year, which represents more than the shipping and aviation industries combined, according to the LSE.

In March, the UK’s Competition and Markets Authority (CMA) secured commitments from ASOS, Boohoo and George at Asda to use only accurate and clear green claims.

In a statement to Minerva, the bureau confirmed that it received a complaint from stand.earth alleging that lululemon has engaged in deceptive marketing practices.

It also confirmed that it has commenced an investigation under the Competition Act into the alleged deceptive marketing practices after receiving an application under section 9 for the commencement of an inquiry on behalf of six Canadian residents, but there is no conclusion of wrongdoing at this time.

A lululemon company spokesperson said: “We are aware of the Canadian Competition Bureau’s review and are committed to cooperating on any next steps. We are confident that its review will confirm that the representations we make to the public are accurate and well-supported.

“Be Planet is a pillar of our impact agenda that outlines our vision, goals and targets which guide our actions and resource investments in helping to create a garment industry that is more sustainable and addresses the serious impacts of climate change. This work is far from complete.

“We have achieved 60% absolute reduction of greenhouse emissions in our owned and operated facilities but recognize most of the impact comes from emissions within the broader supply chain. That is why we have set externally validated (SBTi) 2030 climate targets, and a goal to be Net Zero by 2050, and are taking action.”

Minerva’s blog focuses on the latest developments in ESG investing and stewardship. Minerva is a global provider of sustainable stewardship solutions with over 25 years of expertise. Minerva empowers investors by providing essential tools, including ESG research and data, enabling them to navigate the intricate landscape of stewardship and proxy voting, whilst ensuring their decisions are well-informed and aligned with sustainable principles.