Lloyds Bank’s Low-Carbon LinkedIn Ad Misled Consumers, UK Watchdog Says

(Bloomberg) -- Lloyds Banking Group Plc was reprimanded by the UK’s advertising regulator for violating its rules on environmental claims.

The Advertising Standards Authority said in a statement on Wednesday that a LinkedIn advertisement from Lloyds that discussed the bank’s efforts to support the transition to a low-carbon economy was misleading because it “omitted significant information about Lloyds’ contribution” to greenhouse gas pollution. In leaving out details about its financed emissions, Lloyds was deemed to have breached the so-called CAP Code, which relates to non-broadcast advertising and direct and promotional marketing, the ASA said.

Lloyds was told that the ad may not reappear without being amended in line with ASA’s rules. The London-based bank also was requested to ensure that future ads featuring environmental claims don’t “mislead by omitting significant information” that provides the necessary context. 

A Lloyds spokesperson said the ASA ruling relates to a single LinkedIn post that won’t be repeated. The company remains “committed to supporting transparent public discussion” and “reducing the environmental impact of our business remains a fundamental part of our strategy,” the spokesperson said. “We will continue to work alongside customers, the government, and the market to reach net zero by 2050 or sooner.”

The ad, which first appeared in May and covered ways in which Lloyds was “supporting the energy transition,” had claimed Lloyds was putting the “weight” of its financing into renewable energy. The ASA said that assertion “gave the general impression that renewable energy formed a significant proportion of Lloyds’ investments and the companies it financed.” That isn’t the case because Lloyds continues to finance businesses and industries that emit “notable levels of carbon dioxide and other greenhouse gases,” the ASA said.

The ASA made reference to a Lloyds sustainability report, which shows the bank’s total financed emissions exceeded 30 million tons of carbon dioxide equivalent in 2022. Lloyds is a founding member of the Net-Zero Banking Alliance and it has said it’s committed to achieving net zero financed emissions by 2050 or sooner.

While the ASA doesn’t have the authority to fine companies that breach its rules, it can publicly reprimand those that fall short of its standards. And in recent years, with more public discussions centered on net zero targets, ads pertaining to corporate sustainability achievements have been increasingly in the watchdog’s crosshairs.

The advertising regulator has taken enforcement action against greenwashing at airlines, automakers and consumer goods companies. In 2022, it reprimanded HSBC Holdings Plc, the UK’s biggest bank, for violating environmental ad rules with two posters that were used ahead of a United Nations climate summit.

Adfree Cities, a campaign group that monitors street ads, raised concerns with the ASA about four adverts from Lloyds. The regulator only found one to be in violation of its rules.

Veronica Wignall, co-director at Adfree Cities, called for “a tobacco-style ban on high-carbon advertising to stop greenwashing and clear the way for meaningful climate action.”

(Adds reference to Lloyds’ sustainability report in sixth paragraph.)

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