AANA releases new Environmental Claims Code applicable to all Australian advertising

The Australian Association of National Advertisers (AANA) is the peak marketing industry body in Australia. It also operates Australia’s advertising self-regulation system, which includes Codes developed by the AANA and enforced by Ad Standards, the regulatory body established by the AANA.

On 22 October 2024, the AANA released its new Environmental Claims Code which will come into effect on 1 March 2025. The new Code significantly strengthens the existing Code that has been in place since February 2021.

At the time of releasing the new Code, the AANA said:

“The Environmental Claims Code sets a new standard for advertisers, helping to foster transparency and trust in environmental marketing.  It complements and reinforces the Australian Competition and Consumer Commission (ACCC) Guidance on Environmental Claims, ensuring that environmental messaging is truthful, clear and verifiable”.

How the new Environmental Claims Code will be applied

The new Code applies to all advertising and marketing communications published or broadcast by any means, including by online technologies, but does not apply to:

• labels or packaging for products;
• corporate reports including press releases and media statements; or
• material which promotes a program to be broadcast on the same channel, station or network.

An ‘environmental claim’ is defined as any message or representation (including text, images, graphics, audio or symbolic representations) that gives the impression that an industry, business, product or service:

• has a neutral or positive impact on the environment;
• is less harmful to the environment than alternatives; or
• has specific environmental benefits.

Rules under the new Environmental Claims Code

1. Advertising must be truthful and factual

Code Rule 1 provides that environmental claims in advertising must be truthful and factual. The overall impression created by the advertisement, including any environmental claims, must not be false or inaccurate.

Environmental claims must also not be, or likely to be, misleading or deceptive to the average and reasonable consumer in the target audience (Target Consumer). Advertisers need to be prepared to provide details about the Target Consumer for their advertisement.

Advertisers must also consider the overall impression created by the environmental claims within the  overall context of the advertising, including through the use of visual and audio elements.

Finally, environmental claims must remain valid throughout the life of the advertisement.

2. Environmental claims must be supported by evidence

Code Rule 2 provides that environmental claims in advertising must be supported by evidence.

Advertisers must:

• have reasonable grounds for making an environmental claim, based on evidence held at the time the claim is made
• not misrepresent third party certifications and validations supporting an environmental claim.

Environmental claims in advertising must be substantiated and verifiable.

3. Environmental claims must be clear

Code Rule 3 provides that environmental claims in advertising must:

• use clear language having regard to the Target Consumer
• be specific – broad, vague or unqualified claims should be avoided
• include important limitations or qualifications in a way that is clear to the Target Consumer.

Scientific terminology and references must be relevant, accurate, and used in a way that can be readily understood by the Target Consumer.

If there are important limitations, conditions, or qualifications associated with an environmental claim, they must be clearly explained and included in the advertisement.

In the case of emissions-related claims, Target Consumers may have difficulty understanding broad, headline claims such as ‘carbon neutral’, ‘climate neutral’, or ‘net zero’. Advertisers should provide further relevant information to explain these claims. Particular care must be taken to ensure that any reliance on carbon offsets to make a claim is completely accurate.

4. Environmental claims must reflect a genuine benefit to the environment

Code Rule 4 provides that environmental claims must be about a genuine benefit to the environment and not overstate that benefit. Advertisers must not make environmental claims that exaggerate an environmental benefit or understate an environmental harm.

5. Future claims must be based on reasonable grounds

Code Rule 5 provides that environmental claims in advertising about future environmental objectives must be based on reasonable grounds at the time the claim is made.

Claims relating to aspirational targets or environmental goals should only be made if the advertiser has reasonable grounds, including verifiable data, clear plans, and milestones that outline how these targets or goals will be met, at the time the claim is made.

The Australian advertising self-regulation system

Australia’s advertising self-regulation system, operated by the AANA, is complied with by all major advertisers and advertising agencies. If necessary, the media will remove advertisements which are found by the Ad Standards Community Panel to be in breach of any AANA Advertising Codes.

The Australian advertising and marketing industries take the view that an effective self-regulatory system is preferable to further government intervention in the form of legislation and regulation.

However, all Australian advertising and marketing are also subject to the Australian Consumer Law. That law is enforced by the Australian Competition and Consumer Commission, which is an active and well-resourced regulator.

The new Environmental Claims Code released by the AANA will have a significant impact on environmental claims in Australian advertising. In particular, it will require advertisers to ensure that claims are truthful, clear, transparent and verifiable, and that advertisers are able to identify the target audience for their advertisements.

If you have any questions about the new Code, please get in touch with our team below.

Disclaimer
The information in this article is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.

Published by:

Ian Robertson AO

Sarah Butler

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