Consumers confused over net-zero claims in ads, ASA warns

There is “little consensus” on the meaning of ‘carbon-neutral’ or ‘net-zero’ when these terms are used in product or service advertisements, research from the Advertising Standards Authority (ASA) has found.

Consumers confused over net-zero claims in ads, ASA warns

Most people do not understand offsetting or the extent to which companies are using it, the report warns

The Authority, which is the UK’s advertising watchdog and has powers to ask brands to pull adverts when they break industry codes, has published a new report looking at how consumers understand some of the most commonly used climate-related terms. The findings throw up some key considerations for brands.

According to the ASA, the most frequently-used environmental claims in advertising in the UK are now ‘carbon neutral’ and ‘net-zero’. The body found that members of the general public typically did not understand what these terms meant, with those lease engaged in environmental issues likely to ignore them.

Most of the people the ASA interviewed believed that, in making these claims, businesses were not taking an offsetting-first approach – instead, they were believed to have been reducing their absolute emissions in-house.

When the ASA explained that brands could technically claim carbon neutrality by offsetting alone, a majority said they would feel misled. The Authority found that most people probably believe that the aviation, road transport and energy sectors are doing more in the way of in-house emissions reductions than they truly are.

The ASA is pointing to the lack of a standardized, legal definition of the terms ‘net-zero’ and ‘carbon-neutral’ in the UK as a barrier to strong consensus on the meaning of these terms in advertising. This concern has already been raised with the Government by the Competition and Markets Authority (CMA).

In the absence of such a definition, the ASA found, members of the public would like more information on offsetting and emissions reductions, with timeframes, from the brands they shop with.

The ASA has been in the headlines in the sustainable business space this week for ruling that HSBC would need to pull two of its bus-stop advertising campaigns that it has used since 2020, with an uptick in use around COP26 in Glasgow last year. The ASA ruled that adverts highlighting HSBC’s support for tree planting and cleantech would mislead consumers into thinking that its financing activities had a net benefit to the environment.

This is believed to be the first time that a greenwashing ruling has been made by the ASA regarding advertising placed by a firm in the financial sector.

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