Q&A: What is an SRO? A Beginner’s Guide to International Advertising Self-Regulation

Advertising is a cutting-edge industry, so it is no surprise that the ad business has been at the forefront of a global trend building for almost 60 years – independent industry self-regulation. In the U.S., BBB National Programs’ National Advertising Division is the industry’s widely recognized “truth-in-advertising” body, an independent third party that enables competitors to resolve disputes outside the courtroom. It is the self-regulatory organization (SRO) of the U.S.

In this Q&A with Mary Engle, Executive Vice President, Policy, here at BBB National Programs, we dig into what industry self-regulation looks like in other parts of the world. 

Q: Mary, can you help us better understand the landscape of international advertising self-regulation? Is there a National Advertising Division equivalent in each country? 

Yes and no. There are more than 50 advertising SROs around the world that are all a bit different. They may differ in the way they are funded (e.g., through membership fees, a levy system or through service fees), with respect to the focus of their advertising review, in what is and is not permissible, or in the extent to which they receive consumer complaints. However, by providing independent ad monitoring and accountability, they are all committed to ensure that consumers receive truthful and accurate advertising. 

Q.  What are some of the key similarities and differences between other SROs and the type of independent industry self-regulation that takes place at BBB National Programs? 

Each SRO has categories of advertising claims and issues it reviews. Within BBB National Programs, the National Advertising Division (NAD) and the National Advertising Review Board (NARB) are most similar to international SROs in that they handle the same types of claims or issues as other SROs such as environmental advertising, health and wellness claims, or comparative advertising. One key difference is BBB National Programs’ additional focus on data privacy-related issues in advertising that our Digital Advertising Accountability Program (DAAP) addresses. Many international SROs do not cover data privacy in their advertising guidelines. 

Another difference worth noting is that other SROs address issues in national advertising that NAD does not, such as decency and stereotypes in advertising. BBB National Programs’ Children’s Advertising Review Unit (CARU) does address stereotypes in advertising, but only concerning advertising directed to children under 12. 

Q. How does BBB National Programs collaborate with other SROs – do they share guidance, try to set policies, and if so, how? 

BBB National Programs is a member of the International Council for Advertising Self-Regulation (ICAS). ICAS was established by the European Advertising Standards Alliance (EASA) to facilitate the exchange of best practices among SROs worldwide. It is also dedicated to establishing SROs in emerging markets. When ICAS was launched in 2016 as an independent platform, BBB National Programs was a founding member of this new organization and has played a key role in its governance ever since.

For example, in 2017, the Ministers of the Asia-Pacific Economic Cooperation (APEC) issued a joint statement in which they urged government officials to develop consistent advertising standards throughout the APEC region. ICAS members meet periodically and regularly exchange ideas with each other. We greatly appreciate learning about SROs’ work, particularly with respect to issues they address but U.S. advertising self-regulation does not, such as non-discrimination and non-stereotyping. 

ICAS publishes the Global Factbook of Advertising Self-Regulatory Organizations, which provides a wealth of information about SROs around the world.

Q. In October 2020, EASA welcomed Google as its first corporate Alliance member and a partner of the ad self-regulatory network. Last year, Facebook formed a partnership with BBB National Programs in which NAD can refer noncompliant ads to Facebook, allowing Facebook to determine whether those ads violate their policies requiring advertising to be truthful. Do you think that other platforms (e.g., Amazon) will engage with SROs, including BBB National Programs, and what do you foresee as the end-result of these partnerships with platforms? 

We are pleased with BBB National Programs’ partnership with Facebook and are quite hopeful that it is the start of greater collaboration or partnerships with other platforms. We expect additional platforms to engage with us in 2021.  Platforms are now an integral part of the advertising eco-system and partnering with SROs is a concrete way for platforms to demonstrate their commitment to truthful and responsible advertising and a level playing field for advertisers. Ultimately, by working with SROs, platforms can increase consumer trust in advertising by expeditiously removing misleading claims from the marketplace.

Q. What is one piece of advertising advice you would give to companies looking to expand globally?

Make sure you know the rules of the road for advertising claims in the country in which you are advertising. It is very likely that the country has an SRO that guides advertising practices, as can the country’s regulatory authority. Most SROs provide advice on the compliance of advertisements to companies and provide this service very quickly and efficiently. The International Chamber of Commerce’s Advertising and Marketing Communications Code – or the ICC Marketing Code – is a helpful resource, providing rules of the road for advertising that have served as the basis for many countries’ marketing codes. You may also want to engage counsel familiar with advertising standards in that country to ensure your claims do not run afoul of the SRO and regulators.