GLOBAL: False 'Green' Ads Draw Global Scrutiny

With companies eager to tout their "green" credentials to consumers,

advertising watchdogs in a number of countries are stepping up efforts to

rein in marketers that make false or exaggerated claims.

In one of the latest examples, the United Kingdom's Advertising Standards

Authority found this month that a series of television ads by the

Malaysian Palm Oil Council misleadingly claimed the industry was good for

the environment. In one ad, which appeared on satellite channels across

Europe, Asia and the U.S., a man jogs through a natural rain forest,

interspersed with shots of palm-oil plantations and wildlife. "Malaysia

palm oil. Its trees give life and help our planet breathe," the voice-over

declared.

The problem: Oil-palm plantations, which produce a vegetable oil used in

products such as margarine and soap, have often been planted in illegally

cleared natural rain forests. In neighboring Indonesia, where Malaysian

palm-oil companies own large operations, plantation development is

destroying the natural habitat of species such as the Sumatran elephant,

environmentalists say.

"We concluded that the ad was likely to mislead viewers as to the

environmental benefits of oil-palm plantations, compared with native rain

forest," the U.K. authority ruled.

One limitation with these groups is that the fact-finding process can

sometimes take so long that the offending ad is no longer on the air when

the ruling is issued. That's what happened with the Malaysian Palm Oil

Council, which wasn't affected by this month's decision, because it had

already stopped showing its ad last year. The Advertising Standards

Authority can take as long as a month to make a decision.

From the U.S. to Norway to Belgium, watchdog groups are trying to police

against the rise in bogus environmental marketing, a practice known as

greenwashing. In most cases, these groups are set up by the advertising

industry and run by a third party, and they operate on the honor system.

When the watchdogs are set up, marketers and ad agencies agree to abide by

their rulings, which often means dropping ads that are deemed deceptive.

If the marketers later fail to do so, they run the risk of bad publicity

or possibly even litigation. Only in a few countries, such as Norway, can

regulators impose fines.

Environmental advocates say the increased vigilance is welcome, even if

the watchdogs have limited powers. "Since the climate-change issue is hot,

in Europe there's a load of 'greenwash' advertising," says Paul de Clerck,

a campaigner with Friends of the Earth Europe.

In the U.S., the Federal Trade Commission, which oversees advertising

claims, began hearings this month to determine the kinds of claims that

can genuinely qualify as green marketing. The FTC plans to update its

environmental advertising guidelines, which were last revised in 1998.

Those guidelines set standards for terms such as "recyclable" or

"biodegradable" in the advertising of products. But they don't deal with

standards for trendier environmental claims such as "carbon neutral,"

where a company asserts that it has offset the amount of carbon dioxide (a

heat-trapping greenhouse gas) emitted in making its product.

Sometimes, companies try to knock a rival business's products as bad for

the environment to gain a competitive edge. The National Advertising

Division of the Council of Better Business Bureaus, a U.S. industry-run

advertising body, last year ruled that Born Free LLP, a distributor of

infant feeding bottles, had to drop ads that claimed that the plastic used

in a competitor's bottles was unsafe for both the environment and kids.

The division says it heard no environmental cases from 2000 to 2006, but

has adjudicated six since then.

In Norway, government regulators in September banned all car ads from

stating that their vehicles are "green," "clean" or "environmentally

friendly" on the grounds that all car production leads to more, not fewer,

carbon emissions. The Belgian industry-run, advertising-standard authority

in October ruled that Swedish auto maker Saab Automobile, a unit of

General Motors Corp., must pull a print campaign in which it claimed that

its "Biopower" range of cars make the roads "finally turn green."

Despite the regulatory backlash, companies are often loath to use subtle

language to advertise their environmental claims for fear the ads won't

stand out, says Mike Longhurst, a London-based executive with

McCann-Erickson, a unit of Interpublic Group.

"Clients prefer to say it's good for the environment, rather than it's not

so bad for the environment," Mr. Longhurst says.

Malaysia's palm-oil industry decided to come out with its TV ad because

environmentalists recently have stepped up attacks on palm oil, calling it

a major driver of forest loss: Trees soak up carbon dioxide, and cutting

them down emits huge amounts of the heat-trapping greenhouse gas back into

the atmosphere, spurring global warming.

The Malaysian Palm Oil Council, a grouping of producers, hired TWBA

Worldwide, a unit of New York-based Omnicom Group, to promote the

industry's green credentials. "We decided it was about time we gave a

public-service announcement to the consumer," says Yusof Basiron, chief

executive of the palm-oil council.

But the U.K body ruled that by blending footage of rain forests and

oil-palm plantations, the ads misled the public.

The council maintains that since 1990, all oil-palm plantations in

Malaysia have been planted on already denuded land, not natural rain

forests. It also says it didn't mean to imply that oil-palm plantations

were as biodiverse as rain forests.

"A lot of the implications were something we didn't intend in the ad,"

says Aaron Cowie, chief operating officer of TWBA Worldwide in Malaysia.

• 106 Money & Politics
• 107 Energy
• 116 Human Rights
• 122 Pharmaceuticals
• 181 Food and Agriculture
• 183 Environment
• 188 Consumerism & Commercialism
• 190 Natural Resources
• 192 Technology & Telecommunications
• 195 Chemicals
• 204 Manufacturing