On 6 March 2024, the Dutch Advertising Code Authority, which oversees advertising in the Netherlands, said it deems certain Shell sustainability advertisements to be misleading in response to a greenwashing complaint.
The complaint before the Board of Appeal of the Dutch Advertising Code Authority was an appeal from a 9 October 2023 decision by the Advertising Code Committee of the same body. The original complaint was brought by Jilt Sietsema. On appeal, the complaint was argued by lawyers of De Roos, a B-Corp-certified law firm.
Complaint Against Shell’s Misleading Statements
The complaint concerned statements made in several advertisements by Shell, including a television commercial, in which the company said: “Change, we have to, we can, we want to, and so Shell is investing in new energy for the Netherlands. We are developing hydrogen for the regional buses and trucks of tomorrow. We are changing for a cleaner future”. The complaint refers to a poster with a similar text. A second television commercial refers to Shell’s investments resulting in more charging points for electric cars.
Finally, the complaint discusses Shell’s website, which contained several texts that the complainant thought were misleading. This includes:
“We are changing for a cleaner future. To keep the Netherlands warm, operational, and moving, Shell is active in oil and gas. But we are changing for a cleaner future. We have to, we can, and we want to. Therefore, Shell also invests in new energy for the Netherlands. For example, through electric transport, hydrogen, and biofuels”.
“Quick and easy recharging, at home and on the road. With Shell Recharge, we are making driving electric easier. We offer fast-charging networks and home chargers”.
“We are building wind turbine parks at sea, with smart extras to generate electricity even when the wind isn’t strong. This allows us to make green energy from wind at sea for homes and businesses.”
“Shell Energy offers energy generated from wind and solar that are 100% Dutch”.
Are Shell’s Statements Greenwashing?
The original complaint against Shell’s statements was that they were in breach of Article 3.1 and 3.2 of the Dutch Sustainability Claims Code (SCC) (Code voor Duurzaamheidsreclame), which is part of the Dutch Advertising Code (Nederlandse Reclame Code). As per Article 3.1, sustainability claims have to be clear, specific, correct, and unambiguous, and they cannot mislead a standard consumer regarding the advertiser’s contribution to sustainable efforts to nudge the consumer to make decisions the consumer would not otherwise have made. Under Article 3.2 SCC, advertisers have to make clear that any communicated sustainable ambitions are aspirational and do not necessarily reflect the status quo. You cannot advertise an aspiration when it cannot reasonably be suspected that this will be attained.
The complaint before the Advertising Code Committee
According to the complainant in the first instance, Shell breached these requirements with its above statements, as Shell’s plans to reduce the production of fossil fuels have been reversed, its investments in renewable energy are only a small fraction of its total budget, and its advertised ‘sustainable’ actions contribute little to nothing to reducing Shell’s emissions. However, the Advertising Code Committee decided that Shell’s advertisements made sufficiently clear that Shell’s efforts were mere aspirations, as required under Article 3.2 SCC. Moreover, the Committee argued that it was clear on the face of the advertisements that Shell is in a transition process and that their plans haven’t yet come to fruition. The Committee states that Shell is entitled to advertise its concrete projects with biofuels, hydrogen, electric charging points, and the capture of CO2 and that the complainant didn’t provide any evidence that Shell is not investing in these projects. Overall, the Committee held that there was no violation, emphasising that the average consumer would understand the nuanced approach taken by Shell.
The complaint before the Board Appeal
On appeal, lawyers acting for the appellant argued that the Committee failed to apply Article 3.1 SCC to Shell’s advertisements, especially with regard to how Shell’s advertisements affect a ‘regular’ consumer. It is argued that the Committee overestimates the knowledgeability of the regular consumer regarding Shell’s activities. The appellant maintains that Shell’s current advertisements need to be viewed in light of its decades-long efforts to advertise its ‘sustainable’ activities, which may have allowed consumers to think that Shell is making a significant effort to green its operations. In reality, Shell’s sustainability projects are but a fraction of the entirety of its operations. As such, the appellant argued that Shell should place its sustainability advertisements within their rightful context.
By failing to apply Article 3.1 SCC, the Committee didn’t test whether Shell’s advertisements were sufficiently substantiated, nuanced, and specified. Shell provides no context as to what it means to be ‘changing’ or to become ‘cleaner’. As argued by the appellant, change implies a departure from what Shell had been doing originally, which is not the case.
Finally, the appellant argues that Article 3.2 SCC was applied incorrectly by the Committee. The Committee assumes that the advertisements convey Shell’s ambitions within each advertised project. However, as Shell provides multiple projects for its ambition to ‘change for a cleaner future’ (such as investing in biofuels and carbon capture), the interpretation of the ‘concreteness’ of Shell’s plan should encompass its entire ambition to ‘change for a cleaner future’, not just within the context of a single project.
In its decision, the Board of Appeal states that Shell’s emission reduction targets to lower Scope 1 and 2 emissions by 50% in 2030 are not clear from the advertisements. The Board of Appeal disagreed with the appellant that Shell’s advertisements would confuse a regular consumer as to what Shell’s operations entail. The advertisements merely convey that Shell invests in sustainable projects. However, the Board of Appeal agrees that the advertisements lack context. They do not clarify what Shell’s aspirations are, other than a ‘cleaner future’. This makes it difficult for consumers to understand whether a project is part of Shell’s 2030 (or 2050) emissions reduction target or whether the project is pursued for another reason. Therefore, the Board of Appeal deems Shell’s advertisements to be in violation of Article 3.2 SCC and recommends Shell refrain from using advertisements like these.
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