‘Regulations need teeth’

Press, 19 April 1984, Page 8

‘Regulations need teeth’

PA Wellington Advertising agencies will consider giving their selfregulation procedures some teeth to ward off the spectre of Government regulation. They are considering a proposal to strip accreditation from agencies which fail to obey the present voluntary code of advertising practice, thereby stopping them from working. The proposal, outlined by the Association of Accredited Advertising Agencies last evening, comes after an industry report completed this year by Sir George Chapman, who was commissioned by the agencies. ’ as an independent chairman. Sir George said among other things that New Zealand should have a third private television channel, and that advertising agencies were not making too much money. He recommended that: • The advertising indus-

try form a New Zealand medial council or all-media accrediting system. • That the industry adopt a centralised self-regulation system based on an agreed code of advertising standards, and tie it to agency accreditation. • That agencies reduce their commission rate and introduce a professional services fee to bring greater flexibility to agency remuneration. • That industry parties form a planning committee to consider other future issues. The president of the A.A.A.A., Mr Hilton Mackley, said the present voluntary code of advertising practice gave a clear indication of how agencies were supposed to work. Already cigarette, alcohol, and financial advertising, was regulated. “Essentially, what we have all said is, ‘We have to be responsible.’ We do not want the Government com-

ing in and saying, ‘You will do this and you will do that’, as it has done in some other parts of the world,” he said. Agencies had subscribed to the voluntary code of advertising practice but it had no teeth. Adopting Sir George’s recommendations would be a great step forward, he said. “If any individual company does not adhere to the standards they will stand to lose their accreditation without which advertising agencies cannot financially operate.” Though the industry fully supported the present code the odd advertisement slipped through the net or was not vetted properly. In trying to avoid Government regulation, the New Zealand industry had ample warning signs from overseas. Mr Mackley gave as an example the United States, where regulations arising from consumer lobbies forced one company to

spend $25 million refuting its earlier advertising claims. Favourable reception of the report at last week’s A.A.A.A. national conference had been unanimous in most instances, he said. But the industry expected small advertising agencies would be unsettled by the proposed adjustment of the remuneration system and the association would take that into account, Mr Mackley said. “Small agencies are very important. Most agencies cannot profitably work for an advertiser who spends under $50,000, so small agencies fill an important role,” he said.