Introduction
Greenwashing is a hot topic (pun intended) that all companies should be aware of. Particularly if you are a consumer-facing business, it's important you get on top of the rules relating to adverts. We have seen a steady stream of UK Advertising Standards Authority ("ASA") rulings in relation to companies making misleading statements or omitting information when making environmental claims in their advertising campaigns in breach of the UK Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing.
As the concept of greenwashing grows within the public's conscience, ASA decisions now receive media attention, bringing the risk of reputational damage. Further, in light of the UK Competition and Market Authority's ("CMA") new power to fine companies 10% of their global turnover for greenwashing coming into force from April 2025 under the Digital Markets, Competition & Consumers Act 2024 ("DMCCA"), the stakes can be high.
Lastly, the UK is hardly unique. We have seen a growing number of greenwashing decisions from regulators across the world aiming to combat unsubstantiated environmental claims by advertisers. These include actions in Ireland in the automotive and dairy sectors, in Singapore in the aviation sector (see our January 2025 ESG View regarding the ASAS's VietJet decision), and in the Netherlands against cruise line providers.
Recent ASA greenwashing rulings
Although the ASA launched its campaign to combat inaccurate or misleading environmental claims in 2021, there has been a recent stream of greenwashing decisions. Since 2021, the ASA has implemented rules specific to environmental claims, published guidance to avoid making misleading environmental claims, and issued numerous rulings in respect of adverts which the ASA has found to breach its rules.
We explore a few of the more notable decisions below, including what these tell us about the ASA's direction of travel.
Banking and finance
Recently, in December 2024, the ASA found that Lloyds misled consumers with a paid-for LinkedIn post promoting the bank's efforts to reduce its operational and financed emissions.
The ASA pointed to the public-facing nature of the ad and the lack of qualifying information about Lloyd's non-green activities. It therefore held that the ad gave the general impression that renewable energy formed a significant proportion of Lloyds' investments and the companies it financed, which it found was not the case according to figures from Lloyds' latest sustainability reports (see our January 2025 ESG View for more information).
Travel
The ASA has taken particular aim at the travel and aviation sector.
The ASA ruled in July 2024 that cruise company Hurtigruten Expeditions' inclusion of "sustainable expeditions" in an advert gave a misleading impression of the expeditions' environmental impact. The ASA stated that the claim had not been adequately substantiated, as it had not considered the full like cycle of the advertised product, i.e. the fact that air travel to get to the cruise was necessary.
In January of this year, the ASA targeted the online travel agency eDreams' and two of its adverts. Again, the ASA criticised the use of the word "sustainable" and decided that as the use of the word hadn't been substantiated with sufficiently robust evidence, eDreams' adverts were misleading.
In a continuation of this trend, the ASA remains unconvinced that airlines are able to accurately promote air travel as sustainable, given the level of CO2 emissions produced by the sector. On this basis, unqualified claims from airlines regarding sustainability have been criticised by the ASA, who has found that the following either gave a misleading impression, was unsubstantiated, or had omitted necessary information to understand the claim:
A Wizz Air advert which claimed that it was "one of the greenest choices in air travel".
A Virgin Atlantic advert which stated it would "become the world's first commercial airline to fly transatlantic on 100% sustainable aviation fuel."
Etihad, Lufthansa, and Air France-KLM adverts which in various forms claimed that flying with the airline was to travel more sustainably (see our December 2023 ESG View for more details).
Automotive
In September 2024, the ASA found that Mazda had misled consumers when promoting its hybrid car series as "Exciting, efficient and sustainable".
The ASA found that such an absolute environmental claim was likely to mislead, as both the car (when in petrol mode), and the electricity used to charge it, generated emissions. No information about the emissions produced in the entire lifecycle of the car was provided with the advert, nor did it make clear how Mazda had concluded it was sustainable.
The ASA and AI
As the world shift towards greater reliance on AI, the ASA is no exception. In 2023 the ASA introduced its Active Ad Monitoring system, which uses AI to proactively monitor adverts that may fall foul of the ASA's rules, including those relating to environmental claims. The ASA in its 2023 annual report claimed that, by the end of that year, the tool was processing over 500,000 adverts a month and contributed to the majority of adverts which were amended/withdrawn following ASA action.
The ASA has recently said that it expects 20% of its rulings in 2025 will be sourced from AI-based monitoring.
Therefore, it is clear that the ASA's use of AI to catch adverts that do not comply with its rules and guidance on environmental claims is here to stay. Advertisers should therefore be wary that the ASA no longer requires a complaint to take action, and may do on its own (AI-prompted) volition.
The CMA and greenwashing
Advertisers who flout rules on environmental claims in their adverts should not only worry about the reputational risks arising from an ASA ruling. They can also draw the ire of the CMA who, from April 2025, will be equipped with new enforcement powers under the DMCCA to fine companies up to 10% of their global annual turnover if consumer law has been breached, including in respect of deliberately misleading consumers about green claims.
To date the CMA has had a different enforcement approach to the ASA, focussing on a select number of high-impact investigations (e.g., its investigation into ASOS, Boohoo and Asda, concluded in March 2024). However, this should not provide too much comfort to advertisers. The CMA has been active in publishing specific Guidance for green claims in fashion at the same time as advising 17 (unnamed) fashion brands to review their business practices, focussing on sectors where there has been a concentration of non-compliance. Attention by the CMA may also draw investigations by sector-specific regulators such as the FCA.
Looking ahead
Despite the above, the ASA does not oppose advertisers making environmental claims. The ASA itself has said that advertisers "have a right to speak about the environmental credentials of their products, services, actions and ambitions", but at the same time, they "must be realistic and honest with themselves and their customers about where they are on their own sustainability journey".
The key is that advertisers must then be careful when making environmental claims, and ensure they have read the ASA's rules and guidance before doing so. As for tips to avoid a reprimand, the ASA puts it simply: "Accuracy and transparency". Good practice will therefore typically involve:
Including all relevant evidence supporting environmental claims within the advert itself; and
Expressing environmental claims accurately, including, where appropriate, as a proportion of an advertiser's non-green activities.
Please do get in contact if you would like to find out more.
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