Global greenwashing continues to pose a challenge to consumers and investors alike. Litigation is a commonly used tool to force companies to either prove their sustainability claims or drop them. Recently, New Zealand-based multinational agriculture company Fonterra settled a greenwashing case brought by Greenpeace. Fonterra claimed that certain dairy products came from 100% grass fed livestock. The reality is that they were fed significant amounts of palm kernel. After facing legal action, Fonterra agreed to a settlement. Greenpeace summarizes the results in a press release:
“In April 2025, six months after we lodged our legal action, Fonterra quietly stopped using the deceptive and misleading “100% New Zealand Grass Fed” label. And then finally in March 2026, as the court hearing date approached, Fonterra agreed to an out of court settlement in which they admitted they had breached section 9 of the Fair Trading Act by engaging in deceptive and misleading advertising. And they agreed not to use the label again. We finally made Fonterra admit that they were using tonnes of palm kernel and that their milk is most certainly not 100% New Zealand Grass Fed.”
The difference between grass and palm kernel might appear arbitrary, but it has serious ecological impacts. Palm production is a major contributor to global deforestation. Consumers are often encouraged to “vote” with their dollars. However, if packaging and labeling laws are not enforced, those “votes” are effectively meaningless. Companies engaged in greenwashing risk not only the impacts of litigation, but also the loss of trust among their consumers. In a world where more people are considering the environmental impacts of their purchases, that can add up to significant lost revenue.
Our members can learn more about greenwashing here.
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