The UK’s advertising watchdog has banned a group of advertisements from major oil and gas companies for being misleading as part of a crackdown on “greenwashing”, or to make something appear more sustainable than it actually is.
The Advertising Standards Authority said on Wednesday that recent advertisements from Shell, Repsol and Petronas had misled the public about the climate and environmental benefits of the group’s products in general.
The landmark rulings are expected to set a precedent for how energy companies market their businesses.
The banned advertisements include a television promotion for Petronas, an online advertisement for Repsol and poster, TV and YouTube advertisements for Shell. These ads had “omitted material information” promoting their “green” offerings and plans, such as renewable energy and net zero goals, without any mention of their larger polluting activities, and as such were “misleading,” according to the ASA.
In the rulings, the ASA pointed out that polluting products still dominate the activities of the three companies involved.
The banned Shell ad promoting its green credentials without mentioning its larger polluting operations. The oil company ‘strongly disagreed’ with the ASA’s decision © Shell
“Large-scale oil and gas investment and extraction formed the bulk of (Shell’s) business model in 2022 and will continue to do so for the foreseeable future,” but the relevant advertisements gave the opposite impression, the regulator said.
Meanwhile, Repsol had “a substantial oil and gas exploration strategy”, and the biofuels and synthetic fuels it had promoted in advertisements this year represented “a fraction of (its) business compared to (its) substantial, ongoing and expansion of the production of fossil fuels,” according to the ASA.
Similarly, the public would not understand the “magnitude of Petronas’ continued significant contribution to greenhouse gas emissions given its presentation and claims” in a 2022 ad, the regulator added.
Veronica Wignall, from the Adfree Cities campaign group, who led the charge against Shell, said the ban “marks the end for fossil fuel-based greenwashing in the UK. The world’s biggest polluters are not allowed to advertise that they are ‘green’ as they build new pipelines, refineries and oil rigs.”
Shell said it “strongly disagreed” with the ASA’s decision. Consumers knew “very well that Shell produces the oil and gas they depend on,” but may not know that it also invests in “low-carbon and zero-carbon energy,” the company said.
Repsol said it had allocated about a third of its “total investment to low-carbon companies for the duration of its 2021-2025 strategic plan,” adding that it was committed to a “simply energy transition”. Petronas declined to comment.
The sanctions are part of the UK regulator’s wider investigation into a range of environmental claims across sectors, including heating and transport.
The regulator this year has cracked down on airlines Etihad Airways and Lufthansa over misleading claims about the environmental impact of flying, while last year it banned advertisements from HSBC that it said misrepresented the bank’s green credentials, and another from Tesco about its factory-based products.
The ASA also creates rules to more broadly regulate carbon neutrality and net zero claims.
Regulators in the UK, the EU and the US that monitor advertising, competition and financial markets are paying more attention to climate-related revelations.
Legal and climate experts expect the tightened scrutiny to translate into a growing number of lawsuits challenging potentially misleading claims or breaches of fiduciary duty.
Caroline Lucas, a Green Party MP, said greenwashing ads “have been allowed to spread fake news about fossil fuels for far too long”. The government should give the regulator more powers to “proactively . . . reject these utterly misleading ads” and ban all “high-carbon ads,” she added.
Additional reporting by Tom Wilson
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