ASA updates guidance on misleading environmental claims
What additions have been made to the guidance on misleading environmental claims issued by the Committee of Advertising Practice (CAP) and what additional factors should businesses be taking into account now when considering green marketing campaigns? And are the rules beginning to push businesses into “greenhushing” for fear of greenwashing?
The key takeaway
The ASA has issued updates to its guidance on green claims in advertising, demonstrating a continuing intention to clampdown on misleading environmental claims. Businesses should carefully consider the rules, guidance and steady flow of ASA rulings on this issue before making any green claim, particularly if the business is in an environmentally harmful or high emissions sector. This continues to be a high risk area, with marketing departments regularly stumbling into high profile mistakes, which often have a disproportionately high negative PR impact especially from a consumer trust perspective.
In December 2021 the ASA published guidance on the interpretation of the CAP and BCAP rules on making environmental claims in advertising (the Guidance). The ASA made their first update to the Guidance in February 2023 in relation to the use of “carbon neutral” and “net zero” claims in advertising (see our Summer 2023 Snapshot).
The regulatory crackdown on misleading environmental claims has continued apace, with the ASA issuing a number of rulings in recent months. Claims against energy companies Repsol, Shell and Petronas were all upheld on the basis that their ads omitted material information and were misleading to customers. Anglian Water were also found to have misled customers when one of their ads omitted material information on their poor track record in relation to their Environmental Performance Assessment (EPA) by the Environment Agency.
The ASA has sought to provide extra clarity on the issue in a new section of the Guidance entitled “Claims about initiatives designed to reduce environmental impact”. The new section draws on the principles established within the recent ASA rulings as well CMA guidance on environmental claims in goods and services.
The Guidance highlights a number of factors which make ads more or less likely to comply with the rules on environmental claims, including the following key principles:
- if an environmental claim relates solely to a specific product, this should be made clear to avoid consumers linking the claim to the business as a whole
- if a business has a particularly harmful impact on the environment, an ad which highlights positive environmental activities is likely to be misleading if it does not include “balancing information” on the business’s environmental harm. This balancing information is likely to be more necessary in high emission sectors and sectors where consumers are likely to be less aware of the business’s negative environmental impact
- if an ad refers to lower-carbon activities without including information on a business’s overall harmful impact this may create a misleading impression of the proportion of that business’s activities that are low-carbon
- the ASA will likely consider a business’s EPA in determining whether an ad is misleading. If a business has a low EPA rating, it is likely to be considered material information which contradicts a positive environmental claim and so should be disclosed
- “Imagery of the natural world” may be seen as giving an environmentally positive impression depending on context, and therefore may be misleading without balancing or qualifying information
- absolute environmental claims such as “sustainable” or “environmentally friendly” must be backed up by a high level of substantiation
- a suggestion that a business is already taking steps to reduce emissions and/or environmental harm should be accompanied with any material information about the balance of current emissions and activities
- if an ad suggests that a business’s negative environmental impact is a thing of the past this is likely to be misleading if the business is still having a negative impact
- if an ad details initiatives aimed at achieving net zero, the customer should be given context on how those initiatives form part of the net zero plan and how and when net zero will be achieved. Timescales for a net zero plan are likely to be seen as material information to be included in an ad.
Why is this important?
The ASA is clearly cementing their position on misleading environmental claims in advertising. The rulings and further updated Guidance demonstrate a continuing intention for the ASA to clampdown on misleading green claims. It is clear from the recent ASA rulings and new Guidance that if you are in a sector which has a particularly harmful environmental impact, you are likely to need to give more balancing information when making a green claim. Some have publicly said that the ASA’s approach is likely to lead to companies “greenhushing” so as to avoid any possible accusation of greenwashing. However, the ASA has also made it clear that it does not view environmental claims issues as so binary, and that it is not fair to say that businesses must essentially choose between “greenwashing” and “greenhushing”.
Businesses, including those in a harmful sector, can still make green claims provided that the required balancing information is given.
Any practical tips?
Businesses should familiarise themselves with the rules and Guidance (and the CMA’s Green Claims Code) before making any green claim. If you are in a sector which has a particularly harmful environmental impact, you may need to ensure that any green claim in an advertisement acknowledges these less-climate-positive activities. The ASA has advised that this does not need to dominate the advertisement, but it cannot be hidden away. It’s also important to keep up to date with ASA rulings on this issue to keep track of their current reasoning and approaches.