UK ad regulator the Advertising Standards Authority (ASA) announced an update to the guidance regarding environment-related advertising issues provided by advertising code providers the Committees of Advertising Practice (CAP) and Broadcast Committee of Advertising Practice (BCAP), with a focus on barring green claims by companies that don’t include context into their broader environmental impact.

The new guidance follows a series of recent rulings by the ASA on advertisements by companies that highlighted environmental claims about specific aspects of their businesses that were found to breach the codes by not including sufficient context into the businesses’ overall environmental impact. These included recent rulings against energy companies energy companies Shell, Petronas and Repsol, as well as Lufthansa and HSBC.

According to ASA, the rulings found that “the ads were likely to be understood as making claims about a business’s wider environmental impact and claims about their positive initiatives, therefore exaggerating the business’s overall environmental credentials.”

CAP and BCAP published their initial guidance on environment-related advertising in 2021. The new principles added to the guidance state that environmental claims relating to specific products should make it clear that they are not representative of the entire business, and that ads by companies responsible for significant environmental harm that reference beneficial environmental initiatives are more likely to mislead if they do not include balancing information on the companies’ broader impact.

Additional aspects of the update include a requirement to support absolute environmental claims with high levels of substantiation, guidance that referring to negative environmental impact in the past tense may mislead by suggesting the business has moved on from its negative impact.

The codes also include guidance for net zero claims, with ads referencing initiatives to reach net zero required to include context about the role of those initiatives in reaching those goals, as well as the timeframe to achieve the targets.

In a post on its website referencing the updated guidance, the ASA said that it recognizes the growth in “business anxiety around the risk of making ad claims that get banned for so-called greenwashing,” and a new emerging narrative “that companies face a binary choice between greenwashing and greenhushing,” or avoiding talking about their environmental initiatives.

Disagreeing with the greenhushing narrative, the post guides companies to be more precise and contextual in their environmentally-focused advertisements rather than avoiding discussions of their green products and initiatives. The post adds:

“Impactful and informative green claims benefit consumers because they enable them to make more responsible choices.  Businesses have a right to speak about the environmental credentials of their products, services, actions and ambitions. But in today’s world where there is so much riding on these issues, businesses must be realistic and honest with themselves and their customers about where they are on their own sustainability journey.  They need to ensure that they are communicating in a way that does not get ahead of that journey and in doing so paint a misleading or irresponsible picture.

“Accuracy and transparency of communications is therefore key.”

The post UK Regulator Targets Green Claims that Don’t Include Context on Companies’ Broader Impact first appeared on ESG Today.

The post UK Regulator Targets Green Claims that Don’t Include Context on Companies’ Broader Impact appeared first on ESG Today.