For years, climate-related claims existed in the soft realm of branding, where ambition often outpaced evidence. Terms such as ‘carbon neutral’, ‘deforestation free’ and ‘aligned with net zero’ became widespread in corporate messaging, frequently without rigorous or transparent substantiation. In recent years, however, courts and regulators have begun to treat such language as factual representation—claims that must be verifiable, accurate and intelligible to non-expert audiences. This shift is reflected in a growing number of legal disputes and in prominent rulings across sectors such as aviation, finance, and consumer goods. In this environment, climate-washing—misleading or exaggerated communication regarding climate-related impacts, commitments, or mitigation efforts—has emerged as a distinct and rapidly expanding strand of litigation, which gathered pace in 2024 and has continued into 2025.
From Greenwashing to Climate-Washing
Greenwashing refers to communications that mislead the public into believing an organization’s environmental performance is better than it is. The UN Secretary-General has called for ‘zero tolerance’ of greenwashing, and his High-Level Expert Group has urged drawing a ‘red line’ around it, warning that misleading net-zero claims undermine credible climate action. Climate-washing is best understood as climate-related greenwashing, typically involving unsupported or overstated claims about emissions reductions, carbon-neutral products (often via offsetting), or alignment with net-zero goals. It covers communications that create a false impression of an organization’s contribution to climate-change mitigation—by inflating benefits, omitting known risks, or presenting isolated initiatives as overall performance. The concept applies to both companies and public entities.
Common climate-washing risks include advertising or messaging likely to mislead consumers or investors; deceptive ESG certifications, ratings, or audit statements; and false or inflated claims about carbon credits. Existing consumer-protection and advertising rules provide a legal basis to challenge such claims. In parallel, emerging due-diligence and reporting obligations—such as mandatory human-rights and environmental due-diligence laws—could also be used to address misleading climate-related messaging across supply chains. In some investor-facing contexts, securities law may apply.
The Rise of Climate-Washing Litigation
Across jurisdictions, courts ask what overall impression the climate-related communication, taken as a whole, conveys and whether the evidence substantiates it. They also consider whether the claim is likely to influence purchasing or investment decisions. This approach has pulled once-aspirational language into the realm of enforceable fact. In March 2024, the Amsterdam District Court held that parts of KLM’s ‘Fly Responsibly’ campaign were misleading because the advertisements suggested that offsets and alternative fuels could make flying ‘sustainable’, overstating their environmental benefits and not providing clear, specific context on their limitations. The same logic shaped UK enforcement in August 2024, when the Advertising Standards Authority ruled that a Virgin Atlantic radio ad describing a flight as powered by ‘100 per cent sustainable aviation fuel’ was misleading. The unqualified claim was likely to lead listeners to overestimate the environmental benefits and omitted essential information on lifecycle emissions and their limits. The regulator required clear qualifying information in future ads. In June 2024, Germany’s Federal Court of Justice clarified that ‘climate-neutral’ claims trigger strict transparency duties: it must be immediately apparent whether ‘neutrality’ is achieved through actual reductions or by compensation (offsetting).
‘This approach has pulled once-aspirational language into the realm of enforceable fact’
The scrutiny extends beyond consumer advertising. In March 2024, Australia’s Federal Court—following Vanguard Investments’ admissions—found that representations about an ‘ethically conscious’ bond index were misleading because the screening methodology did not match the product description. The court imposed an aggregate A$12.9 million penalty alongside an adverse publicity order. Taken together, these developments show how climate-washing arises across three recurring channels—corporate pledges, product attributes, and investor disclosures—and how each is increasingly actionable when the headline promise outruns the underlying method and evidence.
The Numbers Behind the Shift
The Grantham Institute’s 2025 Climate Litigation Snapshot covering 2024 trends shows a maturing field. By the end of 2024, the global dataset reached 2,967 climate-related cases, with 226 filings recorded for 2024. About one in five of the cases filed in 2024 targeted companies or their directors and officers, underscoring rising corporate exposure.
Overall climate litigation remains most concentrated in the United States, followed by Australia, the United Kingdom, Brazil, and Germany. In this context, climate-washing has become a prominent corporate-facing claim type: 25 new climate-washing cases were identified in 2024, bringing the post-2015 total to just over 160. Of the more than 100 climate-washing cases decided by the end of 2024, over 60 per cent were classified as successful for claimants. Advertising and product-labelling claims feature prominently, while newer filings increasingly probe omissions in climate-risk disclosures and the integrity of carbon-credit projects and offsetting claims.
Stricter Rules for Environmental Marketing
The European legislation is reshaping the standards for climate-related communication. Directive (EU) 2024/825 on Empowering Consumers for the Green Transition raises the baseline for environmental marketing across the EU: it prohibits vague or misleading claims that cannot be substantiated with verifiable evidence understandable to the average consumer, and it bans claims that a product has a neutral (i.e., ‘carbon neutral’), reduced, or positive impact on the environment in terms of greenhouse-gas emissions where that claim is based on offsetting. Member States must implement the Directive by 27 March 2026. The rules apply from 27 September 2026.
‘The European legislation is reshaping the standards for climate-related communication’
By contrast, the proposed Green Claims Directive—intended to harmonize how explicit environmental claims are substantiated—stalled in June 2025 after the European Commission signalled an intention to withdraw the proposal unless revised, and a scheduled trilogue was cancelled. For now, the proposal remains in limbo. The result is a more decentralized but steadily stricter enforcement landscape, with national consumer-protection and advertising authorities already applying higher standards in practice.
Toward Credible Climate Communication
Climate-washing litigation continues to raise legitimate questions about its long-term impact on corporate behaviour and climate governance. While courts increasingly strike down misleading climate claims, some warn of a counter-effect: greenhushing, in which firms reduce or obscure climate communications to minimize legal risk. Yet recent evidence suggests this caution often reflects gaps in delivery rather than prudence. A 2025 study of more than 1,000 companies with voluntary 2020 emissions targets found that only about 61 per cent met them, while many stopped reporting progress. Likewise, a 2024 study by MIT, Columbia Business School and the European Central Bank found no meaningful difference in tangible climate actions between financial institutions with net-zero pledges and those without.
These findings strengthen the case for closer scrutiny. Courts are not merely criticizing vague language; they are ordering withdrawals, corrective statements, and, in some cases, injunctions—outcomes that carry through to insurance, lending, and credit ratings. With regulators in the EU, UK, US, and beyond tightening expectations, companies face growing pressure to align messaging with verifiable performance. None of this argues for silence. It argues for credibility: clear scope, stated baselines and timeframes, and accessible summaries of methods, assumptions, and limitations, so that a lay reader can follow the reasoning and a specialist can test it. Organizations that move from ambition-led narratives to evidence-based communication will reduce dispute risk—and build more durable trust among consumers, investors, and the wider public.
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