Canada’s competition watchdog is investigating Lululemon Athletica after an environmental organization filed a complaint accusing the Vancouver-based athletic apparel company of misleading marketing and greenwashing.
Stand.earth wrote to the Competition Bureau Canada in February, arguing that while Lululemon is consistently advertising itself to customers as an environmentally-conscious company, it is, in fact, relying heavily on fossil fuels to make its products.
The organization pointed to Lululemon’s 2022 Impact Report, where the company recorded a 100 per cent increase in carbon emissions that year, all while running a campaign called “Be Planet.” The impact report also noted that, while the company has goals to move toward more sustainably-sourced apparel materials, more than 60 per cent of athletic wear in 2022 was fossil-fuel derived.
At the same time, Stand.earth noted, Lululemon was stating on its website that “Our products and actions avoid environmental harm and contribute to restoring a healthy planet.”
READ ALSO: Environmental group accuses B.C.’s Lululemon of greenwashing
In its anti-competition complaint, Stand.earth asked for a rescission of such claims. It also pointed to a petition it started that asks Lululemon to phase out coal and switch to renewable energy sources for its apparel production. More than 47,000 people have signed the petition so far.
“Lululemon’s customers around the world need to know the real impacts of their climate pollution, not the greenwashed version they sell their products with,” Stand.earth’s executive director, Todd Paglia, said in a statement Monday (May 6), while announcing that the Competition Bureau Canada is officially investigating the organization’s complaint.
The bureau is an independent law enforcement agency that works to protect customers by ensuring businesses are competing fairly and honestly.
In an April 26 notice of inquiry to Stand.earth, the agency said it had launched an investigation and is seeking to determine whether Lululemon has contravened the Competition Act “by making false, misleading and/or unsubstantiated representations.”
If it finds Stand.earth’s allegations to be true, the Competition Bureau could fine Lululemon up to three per cent of its gross global profits, for each year that it engaged in activity contrary to the Competition Act. The athletic apparel company would also be forced to remove any marketing that is deemed to be misleading, including any stated environmental goals if Lululemon isn’t actually working toward meeting them.
“This investigation of Lululemon’s claims is a milestone moment because it indicates the Competition Bureau is now focusing not simply on greenwash claims about products, but on forward-looking claims about the business and brand as a whole, claims like ‘net zero’ and ‘carbon neutral.’ This should send a clear signal to brands across the fashion industry and beyond that they need to provide evidence before making meaningless green claims,” said Wren Montgomery, an associate professor of management and sustainability at Western University and co-founder of the Greenwash Action Lab, in a statement.
In a statement to Black Press Media, the Competition Bureau said it tries to finish its investigations as quickly as possible, but that it couldn’t speculate on when when its inquiry into Lululemon would be complete. It emphasized that there is “no conclusion of wrongdoing at this time.”
A Lululemon spokesperson told Black Press Media the company is “confident that (the bureau’s) review will confirm that the representations we make to the public are accurate and well-supported.”
They said the company has made a 60 per cent reduction in greenhouse gas emissions in its owned and operated facilities and that the largest amount of pollution comes from the broader supply chain needed to create its products. Lululemon has a goal to be net zero by 2050, the spokesperson said.
READ ALSO: Environmental groups using competition law to fight fossil fuel sector