A series of sustainability-focused ads run by HSBC have been banned by the UK’s Advertising Standards Authority (ASA), which said the bank was misleading consumers.
In what has been described as the first ruling of its kind, the ASA said it had received 45 complaints over HSBC advertisements that showed statements around how the company is planting trees and transitioning to net zero, but neglected to mention the £14bn (as at end of 2021) funding of fossil fuels and deforestation.
The ASA, which started looking at HSBC’s advertising earlier this year, said consumers seeing those ads would not expect the bank is simultaneously involved in financing fossil fuel businesses that contribute to climate change.
A statement on the ruling said: “We did not consider that [the ads meant] consumers would understand the intricacies of transitioning to net zero, and would not expect that HSBC, in making unqualified claims about its environmentally beneficial work, would also be simultaneously involved in the financing of businesses that made significant contributions to carbon dioxide and other greenhouse gas emissions, and would continue to do so for many years into the future.
“We concluded that the ads omitted material information and were therefore misleading.”
ASA said HSBC must ensure all “future marketing communications featuring environmental claims were adequately qualified and [do] not omit material information about its contribution to carbon dioxide and greenhouse gas emissions.”
Campaigners said the move sets a precedent for other banks to be more transparent.
Robbie Gillett from campaign group Adfree Cities, which led the complaint against HSBC, said: “This is a significant moment in the fight to prevent banks from greenwashing their image. HSBC can no longer ply us with ads pretending they are green while continuing to bankroll climate breakdown in the background. HSBC and other banks such as Barclays and Standard Chartered must stop funding fossil fuels instead of attempting to buy public favor with deceptive marketing campaigns, before these reputational risks turn into legal ones.”
Adfree Cities also said the Royal Bank of Canada is also being investigated by the Canadian Competition Bureau for misleading the public through advertising its commitments on climate action while also continuing to finance fossil fuel development.
See also: – ESG group takes aim at Vanguard over its stewardship
Coal phase-out for funds
In September, HSBC‘s asset management arm announced it will phase coal-fired power and thermal coal mining out of its listed holdings by 2030 in the EU and OECD and by 2040 globally.
In active portfolios this means phasing out listed securities of issuers with more than 2.5% revenue exposure to these activities. The firm also stated it will take action against companies not showing credible plans to phase out coal.