The National Advertising Review Board (NARB), the appellate advertising body of BBB National Programs, has recommended that JBS USA Holdings, Inc., discontinue claims regarding its goal of achieving net zero emissions by 2040.

JBS is the second-largest food company and the largest animal protein producer in the world. Its products include meat, poultry, fish, eggs and dairy. Its retail brands include Swift and Pilgrim’s Pride.

As discussed in our article NAD Finds Net Zero Claims by JBS Unsupported, JBS’ net zero claims were challenged by the Institute for Agriculture and Trade Policy (IATP), a not-for-profit organization with the mission of working for fair and sustainable food, farm and trade systems, before the Nation Advertising Division (NAD). JBS promoted itself with environmental net zero, or carbon neutral, advertising, including the claim that “JBS is committing to be net zero by 2040.”

The challenged claims appeared in multiple national platforms, such as websites, social media, newspapers, YouTube and corporate reports.

The NAD stated that net zero is a recognized standard that guides companies in defining and establishing short- and long-term science-based greenhouse gas emissions reduction goals that align with the Paris Agreement—the means by which the global community since 2015 has attempted to address environmental impacts. As discussed by the NAD, the Paris Agreement attempts to reduce the risks and impacts of climate change by limiting the increase in the global average temperature to well below 2°C above pre-industrial levels by pursuing efforts to limit the temperature increase to 1.5°C above pre-industrial levels.

The NAD concluded that the “net zero by 2040” claims convey to reasonable consumers that JBS is already acting toward specific objectives and measurable outcomes that would enable its operations to have net zero impact on the environment by 2040. It found that JBS has not yet formulated and begun implementing a credible plan to reach net zero by 2040, and that therefore the claims were unsupported.

The NAD noted that the Federal Trade Commission’s (FTC) Guides for the Use of Environmental Marketing Claims (“Green Guides”) state: “Unqualified general environmental benefit claims are difficult to interpret and likely convey a wide range of meanings.” As the NAD stated, the FTC has indicated that qualified green claims are less likely to convey misleading messages that overstate the environmental benefits of actions taken by an advertiser.

JBS voluntarily discontinued one of the challenged express claims. The NAD recommended that the remaining five express claims be discontinued, while clarifying that JBS was free to promote its efforts to develop and implement successful strategies to reduce greenhouse gas emissions with narrower claims. JBS appealed the NAD decision to the NARB.

The NARB agreed with the NAD that “the challenged claims communicate that JBS is already in the process of implementing a documented plan that has been evaluated and found to have a reasonable expectation of achieving ‘net zero’ by the year 2040. JBS, however, has no such formulated and vetted plan at present. Rather, the advertiser is in the exploratory stage of its effort directed toward the net zero 2040 goal.”

The NARB noted that “both parties agree that reaching net zero by 2040 for a company with a business the nature, size, and scope of JBS’s worldwide business is an enormously complicated and complex undertaking.” The NARB was concerned, as the challenger argued, “that JBS does not currently have sufficient scientific support to show that its goal is feasible.”

The NARB stated that it “agrees with NAD’s having cited to the concern of the FTC, set forth in the Green Guides, that broad, unqualified environmental claims can convey ambiguous messages that overstate environmental benefits.”

The NARB recommended that JBS discontinue the five challenged net zero claims:

• “JBS is committing to be net zero by 2040.”
• “Global Commitment to Achieve Net-Zero Greenhouse Emissions by 2040.”
• “Bacon, chicken wings and steak with net zero emissions. It’s possible.”
• “Leading change across the food industry and achieving our goal of net zero by 2040 will be a challenge. Anything less is not an option.”
• “The SBTi recognized the net zero commitment of JBS.” SBTi refers to the Science Based Targets Initiative, an international body that provides guidance to companies for setting targets to reduce their greenhouse gas emissions.

The NARB noted that JBS is not precluded from making the claim “Leading change across the food industry and achieving our goal of net zero by 2040 will be a challenge” without the second sentence “Anything less is not an option,” because the latter sentence “conveyed the unsupported message that JBS was already engaged in concrete efforts to achieve its goals,” as discussed by the NAD. The NARB further noted that nothing in the decision precludes JBS from making narrower claims regarding:

• Its efforts at researching potential methods for reducing emissions and any efforts it is undertaking to reduce emissions
• The steps it is taking to align its activities with SBTi criteria and its engagement with the SBTi process

JBS stated that it “disagrees with the NAD and NARB’s interpretation of how consumers perceive the challenged claims as well as NARB’s conclusion about the record evidence, but JBS will comply with NARB’s recommendation in published statements and advertising claims going forward.”

Why It Matters

As discussed in our article NAD Finds Net Zero Claims by JBS Unsupported, consumers increasingly purchase products based on the environmental benefits claimed by advertisers. Consumers who wish to reduce their impact on the environment can be misled by advertisers due to the complex nature of environmental claims, ambiguous terms and less-than-expert environmental knowledge.

Key to both the NAD and NARB decisions was the interpretation of how consumers perceive the challenged environmental claims. The NARB concluded that “consumers are unlikely to understand what is involved in a business enterprise reaching net zero. Consumers are, however, likely to interpret the challenged advertising as communicating that the goal is a feasible one, and a feasible plan is being implemented.” The NARB also concluded that “JBS has failed to support the feasibility of reaching the announced goal with credible evidence of the steps that would be considered necessary to achieve the goal.”

Net zero claims have become increasingly common in advertising. “A growing number of companies are pledging to cut their greenhouse gas emissions to ‘net zero’ as part of global efforts to tackle climate change, but that goal is rarely supported by a credible plan,” according to a recent report compiled by experts from four independent research organizations. “The idea behind net zero is to stop adding planet-warming gas to the atmosphere, either by preventing the emissions in the first place or removing an equivalent amount through natural or technological means. Scientists say the world needs to reach net-zero emissions by 2050 to limit global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit) compared with pre-industrial times.” The Associated Press, “More Companies Setting ‘Net-Zero’ Climate Targets, But Few Have Credible Plans, Report Says.”

Net zero and other green claims are also hot topics across the pond. The U.K. Advertising Standards Authority (ASA) recently considered a challenge to an ad by Spanish oil and gas company Repsol about its net zero plans. The ad made the following claim: “At Repsol, we are developing biofuels and synthetic fuels to achieve net zero emissions.” Repsol argued that it was spending billions of dollars on low-carbon technologies and projects. However, the ASA found that Repsol’s “focus on the production of biofuels and synthetic fuels to achieve net zero emissions was a fraction of their business activities when compared to their substantial, ongoing, and expanding fossil fuel production.” The Advertising Standards Authority, “ASA Ruling on Repsol SA.”

The ASA also recently upheld a complaint against Shell regarding its environmental claims, including a television commercial that made the following claim: “In the U.K., 1.4 million households use 100% renewable electricity from Shell.” The ASA stated that since the ads “gave the overall impression that a significant proportion of Shell’s business comprised lower-carbon energy products, further information about the proportion of Shell’s overall business model that comprised lower-carbon energy products was material information that should have been included. Because the ads did not include such information, we concluded that they omitted material information and were likely to mislead.” The Advertising Standards Authority, “ASA Ruling on Shell UK Ltd t/a Shell.”

As more green claims are put under the microscope by regulators, advertisers should ensure that before making net zero claims, they have adequate substantiation that can support consumers’ reasonable interpretation of the claims.