ABG Meeting, Dubai, 6 December 2017

José Domingo Gómez Castallo , ICAS President

Advertising Self-Regulation:International Developments

& Challenges

Agenda

1. The value of Ad Self-regulation and the SROs

2. Cooperation within the ICAS Network

3. Global Challenges

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• Regulating, Banning or restricting advertising could be the way Societies could address some social

debates and challenges.

• However, Advertising can be responsible and self-regulate the way brands communicate with

consumers.

• Being responsible is profitable and cost-saving.

• Industry should have the right to regulate itself.

RESPONSIBILITY IS THE BEST WAY TO PROTECT FREEDOM OF COMMERCIAL

SPEECH

The value of Ad Self-regulation and the SROs

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Ad Self-Regulation and the SROs can provide Industry with SR solutions when Industry needs to show or

demonstrate responsible behavior, in order to:

• Maintain a positive image and reputation of the Advertising activity in Society, keeping consumer

trust in advertising.

• Face regulatory challenges: offering SR as a balanced option instead of Regulatory interventions

(e.g. Food advertising addressed to children, Privacy, …).

• Deal with social challenges from the public affecting Advertising performance (e.g. ad-blocking).

• Ensure fair competition (getting an even playing-field) and fair relationship among the value chain

in the advertising sector (e.g. getting transparency against fraud in programmatic advertising).

• Help the Industry to pro-actively comply with the rules preventing Court cases or Administrative

fines.

The value of Ad Self-regulation and the SROs

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• Effective self-regulation benefits everybody.

• Of course, it benefits the industry …/…industry members are able to provide guidance that addresses problems in themarketplace, and in a manner consistent with actual industry practices. In addition, when compared to more traditionallegislative or rulemaking efforts, self-regulations are also easier to reconfigure in response to changes in the marketplace.…/… An effective system of self-regulation can also improve an industry’s reputation in the marketplace. “Actions of a fewbad apples can cast an entire industry in a negative light”

• Effective self-regulation is also valuable to government agencies like the FTC. Our employees are hardworkingand dedicated to their mission, but if effective self-regulators can help us cover more ground, we welcome it. We can thenfocus our attention and resources on the more egregious conduct that causes significant consumer harm.

• Most importantly, effective self-regulation benefits consumers by having additional protections in the marketplace. Forexample, if an effective self-regulator is able to identify and address bad practices early on, …/… effective self-regulationcan lower compliance or regulatory costs.

• These and other benefits of effective self-regulation are why the FTC has a long-standing tradition of support.

• The key to these benefits, however, is that the self-regulation must be effective. Poorly structured or wronglymotivated self-regulatory frameworks can create serious problems for consumers and the marketplace

The value of Ad Self-regulation and the SROs

US FTC

President

Statement.

November

2017

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UK: ASA

▪ Memorandum of understanding ASA-OFCOM:

OFCOM has contracted out ASA to solve

complaints and enforce the rules that

regulate broadcasting advertising, making

less necessary Administrative interventions.

France: ARPP

▪ Cooperation between French SRO and Conseil

Superior de l´audiovisuel: ARPP in charge of

reviewing all TV adverts before broadcasted,

backed by the Audiovisual Authority.

The value of Ad Self-regulation and the SROs

The value of Ad Self-regulation and the SROs

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India: ASCI (the Advertising Standards Council of India)

Recognition of Self-Regulation in the Law

• In 2006, the Act on Cable Television Networks was amended to acknowledge the role of Self-

Regulation, stating: “No advertisement which violates the Code for Self-Regulation in

Advertising, as adopted by the ASCI (…) shall be carried in the cable service.”

• In February 2017, the legitimacy of Self-Regulation was further acknowledged in a judgment

of the Supreme Court which recognizes ASCI as the first step for enforcing the existing laws.

• It supports a strong complementarity between the Law and Self-Regulatory Standards.

The value of Ad Self-regulation and the SROs

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Spain: AUTOCONTROL

Agenda

1. Our Common Vision for Responsible Advertising

2. Cooperation within the ICAS Network

3. Global Challenges

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The role of ICAS at global level

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ICAS (the International Council for Advertising Self-regulation) is the body created by the Advertising Industry

and the SROs to promote Ad Self-regulation worldwide ant to take care of global challenges. It was set up last

year in Lisbon

1. ICAS acts as a central contact point at global level on Ad Self-Regulation and Responsible Marketing

issues, connecting relevant players and encouraging collaboration among them.

2. ICAS creates and shares knowledge and Best Practices, by collecting data, undertaking research, and

developing common solutions to the global challenges faced by the industry.

3. ICAS facilitates the establishment of SROs in new markets, empowering them to grow, and strengthening

existing national SROs (capacity-building).

4. ICAS advocates for Ad Self-Regulation globally, demonstrating the benefits of the self-regulatory

approach for consumers, businesses, regulators and society as a whole.

Australia (ASB) Belgium (JEP)

Brazil (CONAR) Canada (Ad Standards)

Chile (CONAR) Colombia (CONARP)

El Salvador (CNP) France (ARPP)

India (ASCI) Ireland (ASAI)

Italy (IAP) Mexico (CONAR)

New Zealand (ASA) Netherlands (SRC)

Peru (CONAR) Philippines (ASC)

Portugal (ARP) Romania (RAC)

Spain (Autocontrol) Sweden (Ro)

UAE (ABG) UK (ASA)

USA (ASRC)

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South Africa (ASA)(AUTOCONTROL)

Agenda

1. Our Common Vision for Responsible Advertising

2. Local vs. Global Perspectives: The Value of Cooperation within the ICAS Network

3. Global Challenges

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Global challenges for Ad Self-Regulation

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Data Protection &

Privacy

Ad fraud & issues around viewability

Ad-blocking

Children and Obesity

Identification of digital Ad.: Brand content,

Native Ad, influencers, etc.

Women portrayal and stereotypes

▪ New challenges are related to the new digital ecosystem

Ad-blocking: a problem of sustainability

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▪ Historically, Media have offered content for free. Currently, Internet Services providers have also offered many

applications and utilities for free.

▪ Consumers have accepted advertising linked with that free offer. Marketers have paid the invoice. That has been the

non-written deal between the Industry and consumers that have allowed the off-line, and now the on-line,

ecosystem to grow.

▪ Ad-blocking is a new phenomenon. Many consumers have found out that it is technically possible to block

advertising in digital devices. This brings up a serious problem of sustainability for the Advertising Industry.

▪ What is the Industry’s response? To offer consumers a better advertising experience, preventing some kinds of

annoying, irritating and disturbing ad formats.

Ad-bloking: a problem of sustainability

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▪ To develop that program, the Industry has set up the

▪ September 2016: CfBA was founded by 18 leading international associations & online companies

▪ Q3 2016 - Q1 2017: Research involving 25,000 consumers in North America & Europe led to an assessment

of 104 ad experiences for desktop & mobile

▪ March 2017: Publication of the Initial Better Ads Standards which identifies the 12 ‘most

annoying ad formats’ that Coalition members commit NOT to use

▪ June 2017: Google announces that its Chrome web browser will automatically block ads which do not

comply with the CfBA Standards as of 2018.

▪ The industry should implement standards to make sure consumers have a satisfactory

experience when advertising is disclosed. The Industry will need a system and a body to independently

monitor the application of those standards, resolving possible complaints. ICAS is ready to help the Industry.

Ad fraud & viewability: a question of transparency

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▪ Ad fraud is associated with an activity where impressions, clicks, actions or data events are falsely reported

▪ Virtually any programmatic buy can be exposed to ad fraud.

▪ According to a WFA 2016 Study* Ad fraud is likely to represent in excess of $50 billion by 2025, even on a

conservative basis.

▪ In 2016, WFA issued its first guidelines to help marketers reduce their exposure to ad fraud.

▪ Some of the biggest players in the digital environment have promised to raise standards in order to create a“sustainable future” for the industry

▪ In October 2017 The Interactive Advertising Bureau (IAB) Europe has published new guidance aimed at improvingtransparency in the digital advertising supply chain.

▪ ICAS and its network of SROs are available to help the industry to implement any standardsdeveloped in this field.

Data Protection & Privacy

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▪ Nowadays, most of the marketers rely on consumer data for carrying out targeted and effective

marketing campaigns.

▪ In Europe, new rules have been approved -or are being processed-, which reinforce legal

requirements, especially in relation to the information that must be provided to users and how to

obtain their consent for the use of their data.

▪ These rules affect all companies worldwide (if they target the European market)

GDPRE-PRIVACY

Directive

Identification of digital advertising: Brand content, Native Ad., Influencers, etc.

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▪ The development of advertising on the Internet has brought with new tools or advertising modalities such as

brand content, native advertising and the use of influencers/celebrities (b-logging, v-logging), etc.

▪ Traditional rules on the obligation to identify advertising and the prohibition of hidden advertising are fully

applicable

▪ As this issue could be more relevant on the Internet, specific rules or guidelines have been released:

▪ USA:

o FTC has launched the FTC Endorsement Guides which apply also to Social Media.

o FTC’s first law enforcement action against individual online influencers for their role in misleading

practices

▪ FRA: Recommendation on Digital Commercial Communication ARPP (FR SRO)

▪ UK: Guidelines developed by the Advertising Standards Authority (ASA) (UK SRO): recognising ads is the

issue

Children

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▪ Different international organizations have called to establish new restrictions on advertising aimed at children.

▪ These calls often translate into new advertising restrictions at the national level.

▪ Among the most recent:

▪ WHO have asked to reduce the advertising impact of food advertising in children as a good way to reduce children

obesity. Additionally, WHO is looking at developing a nutrient profile model to underpin restrictions on food M2K

▪ A recent report by the UN Food and Agriculture Organization (FAO) includes some recommendations on the

advertising of “unhealthy” food, addressed both at regulators and marketers.

▪ UNICEF is currently working on a Discussion Paper on Children and Digital Marketing, looking at risks to children's

rights and at responsibilities among the different actors in the advertising ecosystem.

▪ Food advertising addressed to children SR initiatives have proved to be effective as an alternative to stricter regulation:

▪ EU Pledge promoted by WFA. There is not specific regulation at European level

▪ PAOS Code. A co-regulatory agreement between the Government, Food Industry and the SRO instead of a law in

Spain

Women portrayal

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▪ On 20 June, UN Women in partnership with relevant players from the

Advertising sector, announced the launch of the Un-stereotype Alliance –

a new global Alliance set to banish stereotypical portrayals of gender in

advertising and all brand led content.

▪ Members include: World Federation of Advertisers, Association of

National Advertisers USA, AT&T, Alibaba, Cannes Lions, Diageo, facebook,

Geena Davis Institute, Google, IPG, IPA, Johnson & Johnson, Mars, Mattel,

Microsoft, P&G, Publicis, Twitter, The Female Quotient, UN Women, Unilever, and

WPP.

▪ This industry-led initiative will join leaders across business, technology and

creative industries to tackle the stereotypes that are often perpetuated

through advertising.

Women portrayal

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▪ UK: after an ASA report published in July 2017 showing the need to

address this issue, CAP is in charge to deliver new standards on ads

that feature stereotypical gender roles or characteristics. ASA will

enforce those standards.

▪ France: Portrayal and respect of the human beings Code

▪ Spain: convention between AUTOCONTROL and the Government to

monitor advertising addressing this issue. A set of guidelines is

coming soon.

https://icas.global

info@icas.global

@icasglobal

+32 474 88 19 85

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Thank you