May 3, 2023
In February 2023, NAD ruled on aspirational eco-benefits claims by JBS USA Holdings, an international food company, which advertised an overall commitment to being "net zero” by 2040."
JBS made additional aspirational claims as follows.
- "Global Commitment to Achieve Net-Zero Greenhouse Gas 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 challenger in the NAD proceeding argued that the claims were misleading because they went beyond merely stating aspirational net zero goals.
The challenger's arguments regarding Nnet impression
The challenger argued that the net impression of JBS' claims was that JBS had an "operational plan in place to achieve its net zero goals and is implementing such a plan.”
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JBS argued that its claims are aspirational in nature and that the net impression for consumers is that they have decided upon a goal regarding net zero and that it was taking specific steps to realize this goal, including the following.
- Issued a $1 billion Sustainability-Linked Bond linked to its net zero climate goals;
- Partnered with experts at the University of Minnesota and Colorado State University to research and study supply chain considerations to address Scope 3 reductions and help it reach its net-zero by 2040 goal;
- Signed an agreement with a company to use a feed additive for cows that would reduce methane emissions; and
- Signed an agreement to purchase verified emission reductions (i.e., carbon offsets).
NAD's decision regarding aspirational claims
Despite the foregoing steps taken by JBS, NAD found the net impression by reasonable consumers was that the claims were relatively broad and went beyond merely communicating a goal, specifically that the net impression communicated “that JBS has a plan it is implementing today to achieve net zero operational impact by 2040.”
NAD stated that its decision doesn't stop JBS from making “narrower truthful and not misleading claims regarding its efforts at researching potential methods for reducing emissions and any efforts it is undertaking to reduce emissions.”
This is a tough decision by NAD in my opinion.
There is a very fine line between preparation for an aspirational, eco-friendly goal and actually taking concrete steps to implement a plan to achieve the goal.
Given the significant steps taken for the preparation of a plan and that the claims were clearly aspirational in nature, it's a little surprising that NAD construed the claims as broadly as it did.