Carbon neutral claims in Australia: what the ACCC expects

Why this matters in 2026

Carbon-related claims — "carbon neutral", "net zero", "climate positive", "carbon negative" — remain a stated ACCC compliance and enforcement priority for 2025–26.¹ They are also some of the easiest claims to get wrong: the underlying calculations involve scope decisions, baselines and offsets that most consumers (and most marketing teams) don't see.

In December 2023 the Australian Competition and Consumer Commission (ACCC) finalised Making environmental claims: A guide for business. The guide sets out eight principles the regulator uses when assessing whether an environmental claim is misleading under the Australian Consumer Law (ACL).² Carbon claims are explicitly addressed.

The legal hook: ACL ss 18 and 29

Greenwashing isn't its own offence in Australia. Carbon claims are policed through the general prohibitions on misleading or deceptive conduct (s 18) and false or misleading representations about the standard, quality, value, composition or performance characteristics of goods or services (s 29(1)(a) and (g)) in Schedule 2 of the Competition and Consumer Act 2010 (Cth).³

Two practical consequences follow. First, intent is not required — section 18 is a strict-liability provision, so a claim made in good faith can still breach the ACL if it is likely to mislead the average consumer. Second, the maximum civil penalty per contravention by a body corporate is the greater of $50 million, three times the benefit obtained, or 30% of adjusted turnover during the period of the breach.⁴

The eight principles, applied to a carbon claim

The ACCC asks businesses to:

1. Make accurate and truthful claims. A "carbon neutral" claim must reflect a measured footprint and a documented reduction-and-offset plan, not an estimate or aspiration.
2. Have evidence to back claims up. The evidence trail typically includes a greenhouse-gas inventory aligned to a recognised standard (for example, the GHG Protocol Corporate Standard) and documentation for any offsets retired.
3. Don't leave out or hide important information. If the claim only covers a single product line, or only scope 1 and 2 emissions, say so.
4. Explain any conditions or qualifications. A claim like "net zero by 2050" needs a brief explanation of what is being measured and what the interim milestones are.
5. Avoid broad and unqualified claims. "Climate positive" without definition is exactly the kind of phrasing the ACCC flagged in its 2023 internet sweep.⁵
6. Use clear, easy-to-understand language. Tonnes of CO₂-e, scope boundaries and offset vintages should be explained in plain language for a general audience.
7. Visual elements should not give the wrong impression. Green ticks, leaf icons and look-alike trust marks shouldn't imply third-party certification you don't hold.
8. Be direct and open about your sustainability transition. Acknowledge what is reduced versus what is offset, and what is still being worked on.²

Where carbon neutral claims usually fail

1. Offset-only "carbon neutral"

A claim that relies entirely on purchased offsets, without meaningful internal reduction, is high risk. The ACCC's guidance is explicit that businesses should be transparent about the role offsets play and should not present an offset-based claim as equivalent to having reduced emissions.² Australian courts have already considered offset-based claims in this light — in the Federal Court's March 2024 judgment in ACCC v Vanguard Investments Australia, misleading representations about the ESG screening of an investment product attracted a $12.9 million penalty.⁶

2. Unclear or shifting scope

A claim that says "we are carbon neutral" but only covers head-office operations (not the product, supply chain or end-of-life impacts) needs to qualify exactly that. The ACCC's guidance treats unstated scope as a likely omission of important information.²

3. Aspirations stated as present-tense facts

"Carbon neutral by 2030" framed as a current claim is the most common drafting mistake. The ACCC's eight principles single out forward-looking statements as a category that needs clear conditions and qualifications.²

What "good" looks like

A defensible carbon claim typically does four things, in plain language and on the same page as the claim itself:

• Names what is included in the footprint (scope 1, 2 and material categories of scope 3, or the specific product) and the reporting period.
• Names the methodology used (for example, the GHG Protocol or a certification such as Climate Active under the Australian Government programme).⁷
• Distinguishes emissions reduced from emissions offset, and links to the offset register entry where applicable.
• Treats forward-looking targets ("net zero by 2030") separately from present-day claims, and explains the interim milestones.

A short substantiation checklist

1. Documented greenhouse-gas inventory for the period covered by the claim.
2. Methodology reference (GHG Protocol, ISO 14064-1, or a published certification framework).
3. Records of emission reductions, with the baseline disclosed.
4. Records of any offsets retired (registry, project type, vintage, quantity).
5. A version-controlled copy of the public-facing wording, dated, kept with the evidence.
6. A plain-language explanation on the page the consumer reads — not buried in a separate sustainability report.

Where to go from here

A useful starting point is to inventory every carbon-related claim on your website, and ask of each one: what is the evidence, what is its scope, and is that scope visible to the reader on the same page? If you'd like a structured review of those claims against the ACCC's December 2023 guidance, that's what our website assessment does.

Related reading: What is greenwashing?, the ACCC's eight principles, and our list of Australian enforcement examples.