ESG Enforcement Tracker

Key facts:

In August 2021, the Dutch Advertising Code Committee upheld a complaint made against Shell plc, which included the slogan “Make the difference. Drive carbon-neutral”. The advert stated that petrol and diesel customers could achieve carbon-neutral driving by paying one extra euro cent per litre of fuel to fund tree-planting and forest management projects that would offset their emissions.

The complainants, a group of nine law students from the Free University in Amsterdam, argued that emissions and compensation activities could not be directly compared, let alone offset against each other. They argued that the effect of compensation measures could not be calculated precisely and that this was not disputed by Shell. Shell objected, saying its projects met the definitions of ‘C0₂ neutral’ as defined by international organisation. It also said that on its website it made clear that the compensation was carried out through the purchase of C0₂ credits, and that consumers would understand this to be the case as they were used to the system.

The Committee found that the adverts were contrary to Article 2 (environmental claims must not mislead consumers about environmental aspects of the advertised product or the advertiser’s contribution to maintaining or promoting a clean environment in general) and Article 3 (the advertiser must be able to demonstrate that its environmental claim is correct) of the Milieu Reclame Code.

The Committee held that the average consumer would understand the term “neutralised” to mean the harm caused by C02 emissions was completely compensated by offsetting measures. Shell did not provide evidence that it was offsetting emissions in full and it could not guarantee how much C0₂ was removed from the atmosphere through the scheme.

The Committee recommended that Shell no longer advertise in this way and told it to remove the ad.

The Committee is a self-regulating initiative that formulates rules with which adverts must comply, but its findings are not legal binding.

In October 2022, Shell lost an appeal in connection with a similar campaign on the basis that the company had no way of demonstrating that its campaign eliminates the damage it causes through fossil fuels.