A whopping 98% of products that are advertised, labeled or packaged as “green,” are not telling the complete truth about their environmental friendliness and are potentially misleading consumers with their claims, according to (pdf) research from TerraChoice Environmental Marketing.

A recent multi-country survey and analysis of so-called “environmentally friendly” products in the toy, cosmetic, cleaning and baby-product categories found that advertising for these products has increased dramatically in the last several years:

Availability of such products in the US and Canada has similarly increased between 40% and 176%.? But while there are more items claiming to be “all natural,” “organic,” or otherwise green, nearly all of them are committing at least one of – what TerraChoice dubs – the “Seven Sins of Greenwashing.”

Greenwashing is defined by the company as the act of misleading consumers regarding the environmental practices of a company or the environmental benefits of a product or service.

The seven sins of greenwashing and their frequency in the US, according to TerraChoice:

The Sin of the Hidden Trade-Off? occurs when one environmental issue is emphasized at the expense of potentially more serious concerns. In other words, when marketing hides a trade-off between environmental issues. Paper, for example, is not necessarily environmentally preferable just because it comes from a sustainably-harvested forest. The Sin of No Proof happens when environmental assertions are not backed up by evidence or third-party certification. One common example is facial tissue products that claim various percentages of post-consumer recycled content without providing any supporting details. The Sin of Vagueness occurs when a marketing claim is so lacking in specifics it becomes meaningless. ‘”All-natural” is an example of this Sin. Arsenic, uranium, mercury, and formaldehyde are all naturally occurring, and poisonous. “All natural” isn’t necessarily

“green.” The Sin of Worshiping False Labels is when marketers create a false suggestion or certification-like image to mislead consumers into thinking that a product has been through a legitimate green certification process. One example of this sin is a brand of aluminum foil with certification-like images that show the name of the company’s own in-house environmental program for which there is no explanation. This sin has been added to TerraChoice’s list since it’s previous report in 2007. The Sin of Irrelevance arises when an environmental issue unrelated to the product is emphasized. One example is the claim that a product is “CFC-free,”? since CFCs are banned by law. The Sin of Lesser of Two Evils occurs when an environmental claim makes consumers

feel ‘green’ about a product category that is itself lacking in environmental benefits. Organic cigarettes are an example of this phenomenon. The Sin of Fibbing is when environmental claims are outright false. One common example

is products falsely claiming to be Energy Star certified.

“The good news is that the growing availability of green products shows that consumers are demanding more environmentally responsible choices, and that marketers and manufacturers are listening,” said Scot Case, VP of TerraChoice. “The bad news is that some marketers are exploiting consumers’ demand for third-party certification by creating fake labels or false suggestions of third-party endorsement.”

In addition to looking at products in the US and Canada, the report also investigated the state of greenwashing in the UK and Australia, including an examination of nearly 1,000 products. Results revealed that greenwashing continues to be an international challenge.

“The final piece of good news is that eco-labeling is on the rise,” added Case. “Legitimate eco-labeling is nearly twice as common as it was in our 2007 survey, increasing from 13.7% to 23.4% on all ‘green’ products.”

About the study: In November 2008 through January 2009, TerraChoice researchers were sent into category-leading big-box retailers in the US, Canada, the UK, and Australia with instructions to record every product making an environmental claim. For each, the researchers recorded product details, claim(s) details, any supporting information, and any explanatory detail or offers of additional information or support. In the US and Canada, a total of 2,219 ‘green’ products were recorded. Claims made bny products were tested against best practices found in guidelines provided by the FTC Canadian Competition Bureau, Australian Consumer and Competition Commission, and the ISO 14021 standard for environmental labeling. The report is available here.