Advertising self-regulation: Can it deliver? DG SANCO’s experience

1. Advertising self-regulation: Can it deliver? DG SANCO’s experience Presentation to EGBA conference17 April 2008 Cécile BillauxDG Health and ConsumersUnit 02, Strategy and Analysis

2. Today’s presentation • Introduction / preliminary remarks • The Advertising Self-Regulation Round-table • Follow-up study on SR practices in DG SANCO policy areas • Conclusions

3. Self-regulation in the advertising sector : the EU framework • Better Regulation context: a role for effective Self-regulation • New Audiovisual Media Services Directive (AVMSD): support for self- and co-regulation • The Round-Table on Advertising Round table in 2006 – best practice/effectiveness • SR is part of our approach on complex public health issues (i.e. obesity, alcohol)

4. Demands for responsible marketing – the example of alcohol Question: To what extent do you agree or disagree with the following? Alcohol advertising targeting young people should be banned in all EU Member States Source: Eurobarometer, Attitudes towards alcohol, March 2007

5. The Advertising Self-Regulation Round-table report

6. The Round Table on EU Advertising Self-Regulation • Focused objectives –ad’hoc • Informing: structured debate around experiences of Self Regulation (SR) in advertising • Analysing: the key determinants of SR effectiveness ….a first step towards a Best Practice model • Manageable size • all concerned parties involved (EASA, SROs, relevant EU industry associations, BEUC, other DGs) • but remained limited in number (20) Advertising Round Table Follow-up study on SANCO SR practices Report published July 2006

7. Main conclusions of the Round Table • Self-regulation is not an alternative to law. On the contrary it works best within a clear legal framework that allows non-legislative approaches but also backs them up. • Self-regulation needs to be trusted in order to be effective, and in order to be trusted it has to be participative.

8. Best Practice model for effective Self-regulation • Effectiveness • Independence • Coverage • Funding

9. Effectiveness • Copy advice: • The Self-Regulatory Organisations should offer the provision of copy advice ideally be provided free of charge • Complaints: • The SRO should establish and publish both performance objectives year by year and records of their performance against those benchmarks. • It should be easy to find through which channel to complain. • There should be a standard for the speed with which complaints are handled.

10. Effectiveness • Publications: • There should be a systematic duty to publish decisions • Training/internal compliance: • SROs could recommend to the Advertising industry for its agreement and action, minimum standards for training of new recruited young advertising staff and for the design of internal compliance processes

11. Effectiveness • Sanctions: • For non-compliance with codes, for repeat offences and for consistently ignoring codes or adjudications, sanctions should be clear and effective. • The minimum sanction should be timely withdrawal of advertising copy. This should apply, not only in the jurisdiction of the adjudication but throughout the business concerned. • The collaboration of the media as a whole on backing the decisions of the SRO is an important element to enforcing the sanctions. The adoption, more generally of “compliance clauses” in advertising contracts should help to make sanctions more effective.

12. Independence • The effectivecontribution of the stakeholders (consumers, parent associations, academics etc) to the elaboration of codes deserves reinforced attention by SRO’s. • Monitoring should include indicators designed to verify the stakeholders’ involvement. • Adjudication bodies should be composed of a substantial proportion of independent persons selected on the basis of calls for expressions of interest, and appointed by the Board. • All Adjudication body Members should be subject to rules on the avoidance of conflict of interests and on the declaration of interests. • A Jury is fundamental in guaranteeing the independence of the process. Composition, nomination process, independence and integrity of its members are the key determinants for the credibility of the system.

13. Coverage • Advertising SR’s today in Europe aim to cover not only pure advertising but a global coverage for all type of other forms of “Commercial” or “marketing communication” like the new emerging trends for “buzz marketing” and “word of mouth”. • The SROs should keep under review any trend to significantly increase the proportion of ‘ad spend’ that escapes SR. • On both the European and national level considerable effort has been put into providing basic legal requirements, specifically for direct and interactive marketing. • SROs must commit to keeping abreast of emerging techniques, to discussing with all stakeholders any concerns raised by these techniques, and to deciding promptly either to deal with these concerns or to alert the public authorities that they would need to develop an alternative approach.

14. The EASA commitments

15. Follow-up study on Self-Regulation Practices in SANCO Policy Areas (EIM - 2008)

16. Key aspects of effectiveness I • Legal base and government involvement • Need for a clear legislative framework, with enough room for private parties • Governments can stimulate, cooperate and approve • Commitment • Private parties need to have an interest • Commitment to be formalised by subscribing • Funds to develop and maintain the scheme • Monitoring and compliance • Monitoring provides information on effectiveness • Complaint handling and sanctions can contribute to compliance

17. Key aspects of effectiveness II • Organisation • Development and maintenance of the schemes needs a strong organisation • Organisation should cover a substantial part of the sector • Organisation should co-operate with stakeholders • Participation and involvement of independent parties • Interested parties need to be involved in code drafting, in complaint handling and in monitoring • Information towards consumers to foster consumer awareness • Adaptation/flexibility • Schemes need to be revised or updated regularly

18. Challenges ahead for advertising self-regulation in Europe • Continue to improve trust and transparency in SR systems (participation of independent players) • Continue to improve coverage (new media) • Commitment of all players

19. Conclusions • SR process important, need to be framed and taken seriously • Societal challenge: Can SR respond pro-actively to the aspirations of a Safer, Healthier and more Confident society?

20. Thank You