Stores across the country are stocking their shelves with more environmentally friendly products, but just because something is labeled as green doesn’t always mean it’s good.

The number of green products on sale in this country increased by 73% between 2009 and 2010, according to a new report from TerraChoice, a marketing firm. However, the vast majority of those products (95%) were found to mislead consumers to varying degrees about how good they are for the environment.

TerraChoice broke down deceptive green advertising, also known as greenwashing, into seven different categories, including companies that make vague claims about their products (“all natural”), make claims without supporting evidence or simply lie about the product’s green credentials (usually by claiming it has been certified by a third party).

More products in 2010 were found to mislead customers with false certifications from third-party organizations like Energy Star, according to the report. At the same time, more products also made specific green claims without merit. In particular, the study found that there is an increase in children’s products that falsely claim to be free of BPA, a potentially harmful chemical.

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Yet, while deceptive green marketing may still be rampant, there are some signs of improvement. According to the report, of those products which are properly certified by a third-party organization, 30% are not guilty of any degree of deceptive green marketing, which is a significantly better rate than for the rest of the green product marketplace.

The report also helps place the state of greenwashing in a larger context. Back in 2007, the first year that the study was conducted, just 1% of all green products were completely accurate with their marketing. By comparison, that number increased to 4.5%. On the whole, the report found that greenwashing is on the decline, though obviously there is still a long way to go.

Earlier this month, the Federal Trade Commission released a new set of guidelines for green product marketing, which may help reduce the amount of greenwashing going forward. As part of these new guidelines, companies would be prohibited from making vague claims like “eco-friendly” and will help to define other terms like “degradable” and “compostable” based on what consumers will likely take them to mean.

Check out MainStreet’s roundup of the worst green product fakers.

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