Vanessa Horne, Commerce Commission competition, fair trading, and credit general manager, said greenwashing was a real concern, as well-intentioned consumers were led to believe products were more environmentally friendly than they actually are.
“Consumers have a right to clear and accurate information, and greenwashing makes it virtually impossible for a consumer to identify if a product is genuinely sustainable.
“Kmart’s absolute claim of ‘100% sustainably sourced cotton’ implies a high level of certainty that we believe Kmart did not have.”
Horne said unsubstantiated claims were unfair for businesses who put in the time and resource to make sure their environmental claims are legitimate.
“We are very supportive of businesses getting involved in sustainability initiatives, but as with any advertising, claims made must be accurate and be able to be backed up to avoid breaching the Fair Trading Act.
“Our message to businesses is simple: if you can’t back it up, don’t say it.”
Kmart has been approached for comment.
It is owned by Australian conglomerate Wesfarmers Ltd.
Kmart’s New Zealand division reported a bumper $106 million profit for its 2024 financial year, up from $69.6m the prior year.
The business’ revenue for FY24 grew from $923.9m in FY23 to $999.5m, increasing by 8.1% in the year to June 30.
Kmart benefitted from a lower cost on goods sold, which fell from $567.9m to $560.8m, although its selling and occupancy expenses and admin costs were up.
