Dairy company Arla convicted for misleading green advertising

Arla’s Net Zero Climate Footprint logo in Swedish

Article first published in Swedish on Badvertising Sweden 

The European dairy company Arla has made multiple claims that their products are climate neutral in Sweden, despite a lack of solid evidence to support such claims. 

As a result of this Arla was brought in front of court to defend these green claims. On February 2nd, the Patent and Market Court's released its decision on Arla's claim of a "net zero climate footprint" on its organic products, which was reported by Badvertising Sweden.

The court ruled against  Arla's strategy of using a time horizon of a hundred years for which the climate impact of its products would be ‘compensated’. One of the court’s main arguments is that it is not made clear in the advert that the ”compensation” of the climate impact is to be made within a hundred years. A person reading the ad quickly, or in passing, might get the impression that the product has no climate impact at all, or that it is ”fully compensated”, which is clearly not the case. 

It took two years before the Swedish advertising regulator - the Consumer Ombudsman - took Arla to court after an outright refusal to stop their misleading advertising, even though the Swedish Consumer Agency had previously condemned it. In the meantime, nearly 300 complaints were filed to the Swedish Consumer Agency reports about the misleading nature of these adverts and millions of product packages were distributed to Swedish people with Arla's misleading message. 

Now the Swedish court has finally ruled against the company, with a clear message: Arla's marketing with "net zero climate footprint" is misleading and inappropriate. As a basis for its decision, the court provides a number of different reasons, discussed below.

The meaning of climate compensation is contested

Arla claimed that the organic dairy products are aimed at a consumer who is "more aware and generally more interested in environmental and climate issues than the consumer who chooses the regular range". Against this background, Arla believes that it is reasonable that this informed consumer understands the meaning of the marketing "net zero climate footprint". However, the Court disagrees:

"It is a question of a broadly composed group, where some consumers have an interest in consuming with environmental and climate considerations. Although some consumers can have knowledge of what climate compensation means, the court believes that the average consumer lacks more in-depth knowledge on the subject.” (translation from Swedish quote)

The ad gives the impression that the product has no climate impact 

The Swedish Consumer Agency has pointed out in its arguments that Arla has separated the word ‘net’ from ‘zero climate footprint’ in a different colour and a different size, which can give the impression that the product has ‘zero climate footprint’. The authority further believes that regardless of whether net is included in the concept or not, it is a "vague and non-specific environmental claim" and that "the impression given is that the product does not affect the climate either before the purchase, at the time of purchase or later." 

The court takes takes aim at this:

"Through the design, the word 'net' is thus less prominent and risks, with a less careful reading, being overlooked by the average consumer who instead attaches importance to the words 'zero climate footprint'." In the court's opinion, the claim conveys the impression that the product in question does not affect the climate at all or, in any case, that the climate impact caused by the product has been compensated for in full." (translated from Swedish quote)

Arla’s swedish milk bottle with Net Zero Climate Footprint label

Using a hundred-years horizon for climate compensation is problematic

Arla defended its advertising by arguing that its climate compensation is following generally accepted methods, ie. the Global Warming Potential 100 (GWP 100) calculation method, which is based on a time horizon of one hundred years for climate compensation. The court agreed with Arla that this is the most common method, but certainly not the only one. If methods based on a time span of 20 or 30 years were used instead, Arla's "compensation" would not be fully sufficient. The court elaborates its reasoning:

According to the court's opinion, it is problematic that the calculations aim at a result that is to be achieved only after 100 years - far enough in the future that no-one alive today will be able to witness it. 

The court believes that on a quick reading it is not possible to "understand the claim in any other way than that the product in question does not affect the climate at all or in any case that the climate impact caused by the product has been compensated for in full."

At New Weather Sweden, we consider the court's reasoning about the misinterpretation of the climate compensation claim to be an important one, as it is likely that all compensation claims in advertising may imply that the product does not affect the climate at all or is fully compensated in the present.

Ida Nyström, process adviser at the Swedish Consumer Agency, commented on the court’s decision: “The verdict is good because many consumers want to shop with consideration for the environment, but may have difficulty knowing what is the climate footprint of a particular product. Therefore, it is especially important that companies take responsibility and do not exaggerate in advertising.”

Badvertising is now calling on more companies to stop using misleading and deceptive claims about "net zero" and "climate neutral", alongside our demands for tobacco-style advertising bans for high-carbon and environmentally damaging products.

As already stated, Arla has already stopped its marketing of net zero, but if the company were to start using the term again, it would have to pay a fine of one million Swedish crowns (about £79,820).

For more info, read the Swedish Consumer Agency's press release here and the judgement from the Patent and Markets Court here. Arla has three weeks to appeal the verdict.