Z Energy apologises for 'greenwashing' ad after legal action

Fuel retailer Z Energy has apologised for any confusion caused by a 2022 advertising campaign that said it was in the business of getting out of the petrol business.

Consumer NZ and two environmental groups took legal action claiming the campaign was misleading and greenwashing.

During 2022 and 2023 a large scale 'Moving With The Times' campaign was conducted through print, television, billboards and social media outlined Z Energy's commitment to alternative fuels and emission reductions.

But in 2023, Consumer NZ, Lawyers for Climate Action New Zealand, and the Environmental Law Initiative sought High Court declarations that Z Energy had misled New Zealanders with its messaging in the campaign.

All parties have now agreed to settle the action with an agreement to disagree, but with no admission of liability nor payments.

Z's chief executive Lindis Jones said the campaign was meant to be provocative but not misleading.

He said the company would keep selling fuel but was working to be a lower carbon business such as extending its electric vehicle charging network.

A shared statement from each party was published in the Sunday Star Times and New Zealand Herald on Sunday.

"Z apologises for any confusion caused by parts of its campaign and to any customers who thought Z was going to stop selling petrol any time soon," a joint statement said.

All parties said they were concerned about greenwashing, and backed the need for accuracy of communication which consumers could rely on.

They jointly called on the government to back "bipartisan policies and strategies to ensure that NZ's emissions reductions targets will be achieved".

Z Energy chief executive Lindis Jones said he had no problem apologising for any confusion but stood by its contention that Z was participating in energy transition.

"I don't believe any customer should be confused by anything we say now or in the future, and the fact some might have been confused was good enough for me for an apology.

"But that message was designed to be provocative, and called on customers to think of Z Energy as more than just a fuel retailer," Jones said.

He said the background information at the time about biofuels, Z's emissions reduction, and investment in EV charging supported its broader message of being part of the change process.

Last year lawyer James Every-Palmer told the High Court in Wellington the fuel supplier touted the ownership of a biofuel plant that had actually shut down in 2022 and investment in EV charging facilities which were "insubstantial by any measure".

He said the company was New Zealand's second highest greenhouse gas emitter - accounting for nearly 15% of the country's emissions.

Chief executive of Consumer NZ Jon Duffy said both sides had made compromises in accepting a settlement.

"What Z's apology does do is it sends a message to other entities that may be considering advertising - that gets close to greenwashing - and my hope is that they will think twice," Duffy said.

He said the settlement allowed for a statement to be made in a more timely fashion - instead of waiting until 2028 for a decision to be reached.

"That's nearly six years from when the actual advertising went out in the public. It isn't good enough, given the urgency of climate change."

A joint call for government leadership on climate change

Duffy said an important element of the settlement was all parties jointly calling for greater leadership from the government on transitioning from fossil fuels to renewable energy.

"So, to have a major fossil fuel emitter come out and acknowledge both that greenwashing has been underenforced and that there's a lack of leadership from government on climate change, is a pretty big deal I think," Duffy said.

He said the inclusion of the stance in the agreed statement was an example of the maturity with which Z Energy had approached the litigation.

Z's Jones cited sustainable aviation fuel as an area the government could lead on and ensure suitable policy settings.

"The airlines, the energy companies like Z, and the government have to work together and collaborate and not just wait for each other and that's absolutely essential to meet challenging and significant problems when it comes to climate change."

The Environmental Law Initiative's director of research and legal, Matthew Hall said the precedent set by the settlement drew an important "line in the sand" for corporate conduct in New Zealand.

"We saw this campaign and we wanted to call it out and the settlement that we've achieved has these components that we think are important to put corporate New Zealand on notice that if greenwashing occurs then we are prepared to scrutinise company's claims and hold them publicly to account.

"Obviously Z has not admitted liability - and doesn't think this is greenwashing - but we think that the settlement does achieve a large part of what we set out [to] at the beginning," Hall said.

Minister of Commerce and Consumer Affairs Scott Simpson said the Government was progressing changes to the Fair Trading Act to strengthen it's enforcement regime.

"The Fair Trading Act 1986 applies to all businesses and requires them to be truthful when it comes to all types of claims, including environmental claims.

"Any statements about environmental credentials must be truthful, backed by evidence, and not misleading, regardless of whether the business is subject to mandatory reporting requirements," Simpson said.

He said Commerce Commission guidelines were available to give businesses practical advice to help them comply with the Act.

By Bill Hickman and Gyles Beckford of rnz.co.nz