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Avoid legal risks when pushing the boundaries of brands

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Emma Green of Bird & Bird provides four tips on successfully embracing environmental, social and governance (ESG) values in branding in the UK

Long gone are the days when ESG was a tick box exercise: operating a successful brand in today’s social climate means having a strong ethos, clear principles and even a drive to inspire change.

However, getting the attention of your audience can carry legal risks. Brands need to exercise caution to ensure the headlines they are making are the right ones and to avoid going viral for all the wrong reasons. Four key considerations are:

1. Use of third-party brands carries infringement risk:

Advertising to inspire activism usually means the content needs to be provocative. The temptation to call out big brands on their failures can be significant, especially for growth-stage challenger brands or competitors who think they are doing a better job. However, commercial use of a third-party brand name or logo that is registered as a trademark in relation to the same goods or services is, most likely, still going to be an infringement.

In the absence of registered rights, such use may also be an actionable passing off in the UK. This triggers a significant risk of legal action, in particular injunctive relief to stop such use, regardless of the length of the campaign or how honourable the motivation.

Costs awards for the losing party can be significant, with liability arising for the other side’s costs as a minimum. Take specialised legal advice on any particularly incendiary advertising to avoid campaigns backfiring in unwanted public relations and legal costs.

2. Be mindful of the regulatory environment:

Doing good does not give brands carte blanche on the statements they make. In the UK, the Advertising Standards Agency (ASA) supports the legislative framework and regulates comparative advertising claims and adverts targeted at specific demographics. It also enforces the prohibition on political advertising under the Communications Act 2003.

The ASA has the power to ban adverts and seek amendments to claims, and can even apply pressure to have advertising space revoked and request that search engines discontinue paid-for ads or display a notice when someone searches for the sanctioned brand.

3. Substantiate claims:

Promoting a specific value of your brand can generate consumer interest but those claims need to stand up to scrutiny. Avoid the temptation to exaggerate: do you have evidence to support the claim you want to make, is it sufficiently objective, and is it free from misleading statements?

Particularly topical is the field of sustainability: allegations of greenwashing can quickly undermine the good work a brand is actually doing to improve its ecological credentials, so make sure claims can be supported.

4. Exercise caution with partners:

Working with third parties and influencers can help push a brand message to a new audience. Draw up a clear framework on permitted statements and agree on any topics and messaging which is off limits.

In the current cancel culture climate, a faux pas with one partner can have a significant knock-on impact with other sponsors or clients, so choose collaborations wisely and make sure contracts are in place to document each side’s responsibilities.

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