Canada’s Competition Bureau has launched an official investigation into lululemon over allegations of “greenwashing,” or misleading shoppers about its environmental impact.
The agency confirmed that it has “commenced an investigation under the Competition Act into the alleged deceptive marketing practices” in an email statement to Daily Hive.
“There is no conclusion of wrongdoing at this time,” stated Competition Bureau spokesperson Marianne Blondin.
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This comes after a BC-based grassroots environmental organization filed a complaint against lululemon in February.
Stand.earth accused the Vancouver-founded athleisure company of presenting itself in ad campaigns in a “false and misleading” way as a retailer committed to the environment and sustainability.
“We are pleased that, through this investigation, the Competition Bureau will have the opportunity to ask lululemon how it can claim to ‘Be Planet’ while creating more planet-harming emissions every year than half a million cars,” said Todd Paglia, executive director at Stand.earth, in a statement.
Paglia is referring to the brand’s Be Planet marketing campaign from 2020. Stand.earth’s complaint to the Competition Bureau says the campaign promoting sustainability contradicted the brand’s 2022 impact report.
The environmental organization says the impact report revealed a 100% increase in climate pollution since launching the marketing campaign.
It added that over 60% of the materials the company uses are derived from fossil fuels.
In an email statement to Daily Hive, lululemon said it’s cooperating with the Competition Bureau’s investigation.
“We are confident that its review will confirm that the representations we make to the public are accurate and well-supported,” said a spokesperson.
They added that lululemon has achieved a 60% reduction of greenhouse emissions in facilities it owns and operates.
However, the company does recognize that 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,” stated the spokesperson.
According to the letter Stand.earth received from the Competition Bureau on April 26, the investigation will assess whether lululemon has been “making false, misleading and/or unsubstantiated representations.”
The environmental organization says that if the bureau finds the brand guilty of deceptive marketing practices, it could be fined a penalty of up to 3% of its gross global profits for each year the company committed the alleged “greenwashing,” potentially amounting to US$400 million or more.
“Stand requests that the funds be dispersed by the Environmental Damages Fund and used for climate mitigation and adaptation efforts,” reads the organization’s statement.