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Australian film and literature classification scheme

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CHAIR —Welcome. The submission from AANA is No.28; from the Communication Council, No. 47; and from the Outdoor Media Association, No. 57. Do any of you wish to make any alterations or amendments to those submissions?

Ms Bain —Yes, I would like to note a correction for the committee on page 21 of our submission in relation to the complaints figures. We note in our last dot point on the top of page 21, eight complaints found in breach; that number should actually be seven.

CHAIR —Thank you. That is noted. Would any of you like to make an opening statement before we move to questions?

Ms Bain —AANA thanks the committee and appreciates this opportunity to provide evidence to the inquiry into the Australian film and classifications scheme. AANA is the peak industry body representing Australia’s national advertisers. I would like to note for the committee that the advertising Standards Bureau is independent and administers the complaints system which underpins the advertising self-regulatory system. AANA established the self-regulatory system in 1997. It is comprised of a number of codes, practice notices and industry initiatives. The code of ethics is the cornerstone of the self-regulatory system in Australia. It and the other AANA codes apply across all media, including outdoor media. The code of ethics deals with questions of truth and accuracy, along with the portrayal of people, the portrayal of violence, the treatment of sex, sexuality and nudity, the use of language and prevailing community standards on health and safety. The code is currently under review by the AANA. That review is being undertaken by an independent reviewer, Dr Terry Beed, who was appointed by AANA in 2010. The review of the code has found a high level of community and industry satisfaction and recognition of the code’s pivotal role in the self-regulatory system. When we launched the review of the code in 2010, we had aimed to have that review completed by February of this year, However, in deference to this inquiry and also the House of Representatives inquiry into billboards and outdoor advertising, AANA can confirm that that review will be extended. AANA will review the input into this inquiry and will be interested in this committee’s recommendations. In relation to that code review, we conducted a public consultation process last year and we regard this committee’s process as another important input to the code review.

In relation to the other AANA codes, the code of advertising and marketing to children, and the food and beverages code, I can note for the committee that those codes will be reviewed in t011 by Dr Terry Beed as an independent reviewer. I would like to also note in relation to those other codes that following the Senate inquiry into the sexualisation of children, AANA amended the code for marketing and advertising communications to children to include a direct prohibition against the sexualisation of children and a ban on the use of sexual imagery in advertising directed to children. In 2010, the ASB has reported that less than two per cent of complaints were about the sexualisation of children.

I would like to note for the committee that AANA reviews the self-regulatory system as a transparent robust system, and one which can adapt quickly and easily to changing community standards. Importantly, it comes as no cost to the complainant or the taxpayer. AANA regards the low level of complaint and low level of breaches as indicative of a system which is working well and responding to community safeguards. Given the low level of complaint, and the high level of satisfaction with the code of ethics, AANA does not regard the classification of outdoor media as being required. Notwithstanding this low level of complaint, however, double AANA regards the outcome of this review as an important input to its code review process.

CHAIR —Thank you.

Mr Leesong —Thank you for the opportunity to appear before the committee today. The Communications Council is a relatively newly formed body. It is an amalgamation of four different industry associations on the agency delivery side of the business. We are the peak rep body representing agencies in the marketing and communications sector. As opposed to the advertisers, which are covered by AANA, our remit is the actual creators and deliverers of the content in the creative space. Conservatively the sector is worth about $30 billion to the Australian economy per annum. Our members obviously hail and didn’t from different creative disciplines and they include traditional advertising agencies, graphic design houses, production companies and we encompass the full production cycle from brief and concept to delivery of the actual communication within the different channels. Our organisation’s charter is to help members grow their business and develop their individual careers. We do this through providing educational and advisory services and the traditional association business advice services which you will see in the more traditional associations.

From the outset we recognise the importance of members acting in a legally and ethically responsible manner. In fact, a lot of the focus of our membership and as an industry body is the education of the code of ethics and the broader education of compliance and advice of compliance with codes amongst our membership. To give you an example, the organisation which I represent conducted over 50 ethics workshops around Australia which were designed specifically to deal with the actual practitioners, the creatives, the account managers and the planners in how they should be addressing campaign development in line with community expectations.

We obviously strongly support the ongoing use of a self-regulatory framework as a mechanism for effectively achieving both community interest and encouraging commerce to operate efficiently. We do point to the high industry and community satisfaction of the independent reviews which are done through the ASB, the high recall rate of where to complain, for example, is a very healthy thing. At the last count that was at around 63 per cent, which I am sure the ASB will mention. That, I am sure, is higher than the vast majority of very senior, dare I say it, cabinet ministers names in the unprompted recall rate and knowledge.

We also point to the relatively low level of upheld complaints overall. When we look at the number of advertising campaigns out there, the number of complaints and the number of complaints upheld, we think the system is handling what is a very large task very effectively. We do not consider that including outdoor advertising within the National Classification Scheme is appropriate or necessary. More importantly, we do not believe it is practically possible. My colleagues will go through the exact number of campaigns out in the marketplace in the outdoor media context, but it is in excess of 30,000-odd advertisements. Classifying them provides a really challenging administrative burden.

In summary, we are obviously very committed to making sure that our communications mechanisms are in line with community expectations. It is within the interests of both the agency and the client advertiser if it has a role in social media and there are major commercial ramifications. Overall, we are more than happy to answer any questions you have about how the current system operates and where we fit into the scheme of promoting and encouraging responsible communications throughout Australia.

Ms Moldrich —Thank you for this opportunity to respond to your inquiry. The Outdoor Media Association is the peak industry body representing 97 per cent of Australia’s outdoor media display companies as well as production facilities and some media display asset owners. The OMA does not represent businesses that display on-premise signage or other first-party advertising. Our media display members advertise third-party products including on buses, trains, taxis, pedestrian bridges, billboards, street furniture and in bus stations, railway stations, shopping centres, universities and airport precincts.

In both outdoor and other advertising, the vast majority of ads are not complained about and the majority of those that do receive complaints are found to be compliant with the AANA codes. Our members are conscious of their commitment to comply with the self-regulatory system and to this end the industry conducts internal reviews of all ads before they are posted. On the rare occasions when the ASB upholds a complaint, the industry takes immediate action to remove the ad.

The OMA submits that the self-regulatory system is efficient and effective, with only seven out of 30,000 ads posted last year upheld by the ASB. We have a 99.98 per cent accuracy rate which is an excellent record by any reasonable standards. It is simply a popular myth that outdoor advertising is dominated by a multitude of inappropriate images. While the OMA hopes to achieve a figure that is even closer to 100 per cent, we consider the inclusion into a National Classification Scheme would be unnecessarily costly and onerous both for government and for business.

The industry takes it obligations to the community seriously and it can be relied on to comply with the self-regulatory system. You can see the social responsibility of the industry in its commitment to numerous codes of practice and in the extensive and ongoing contributions that it makes to community which are all outlined in detail in our submission. Contrary to what some submissions have suggested, the industry is motivated to comply with the self-regulatory system because the industry wants that system to work. This again is reflected in our 99.98 per cent accuracy rate. We feel that the industry has nothing to gain from offending the community because advertisers are ultimately market driven.

The OMA rejects the assertion that simply because a self-regulatory system is subscribed to it must be biased and ineffective. We ask that you take a look at the make-up of the ASB, which is comprised of a broad range of individuals that do not have a background in advertising and who have been briefed on the research about prevailing community standards. We would also like to share our view that a perfect system of no complaints and no breaches is simply not realistic. We note the example of TV advertising. TV ads are classified and yet they still made up 62 per cent of the complaints to the ASB in 2010 and 15 cases were upheld. With this in mind, incorporating outdoor advertising into a National Classification Scheme on account of the seven upheld cases seems unnecessary, costly and burdensome on both government and business.

It also needs to be noted that the seven ads upheld by the ASB were not posted in blatant disregard of the codes. We believe that there is room for improvement on our 99.98 per cent accuracy rate by an introduction of a system of education, so that our members are better equipped to judge how the ASB applies the codes, particularly in the context of the broad audience that views our ads. Judgments about these matters are very subjective, so education on how best to make judgments is an appropriate response. An outcome of the current inquiries is that the OMA has already started this process of education.

Finally, we would like to advise the committee of the research the OMA commissioned in 2007. ACNielsen found that 87 per cent of people were neutral or positive about the role of outdoor advertising, while only 13 per cent were negative about it. The reason we bring this to the committee’s attention now is that we feel that some of the submissions that are calling for restrictions on outdoor advertisements do not represent the majority of the community, and we ask that you bear this in mind when weighing up the various arguments. Quite simply, classification of outdoor advertising would be unnecessarily costly and cumbersome, and this would make it a less appealing medium for advertisers. Large and small businesses in the industry would suffer significant loss of revenue as a result. Not only is this a harsh response in the context of our 99.98 per cent accuracy rate, but it would also affect the industry’s ability to continue making significant contributions to the community. Again, we submit that the small number of cases upheld by the ASB simply does not justify government intervention into a system that is working well and which the industry is clearly committed to abide by; however, we do welcome this inquiry as a means of further scrutinising our own processes.

Senator CROSSIN —I have quite a few questions to ask you, but I will try to get this in a bit of context. The AANA is the Australian Association of National Advertisers. You say in your submission that in 2010 there were 33 million national ads across all media. That would include outdoors advertisements but would it also include television advertisements?

Ms Moldrich —Yes. That figure represents all national advertising campaigns. It is across all media and from advertisers, including advertisers who are our members and advertisers who are not our members.

Senator CROSSIN —So we have got 33 million ads in one year and, of that, you received  600 complaints. Is that correct?

Ms Moldrich —The Advertising Standards Bureau reported that over that same time period they received 600 complaints.

Senator CROSSIN —So if we go to the Outdoor Media Association: you have got 30,000 advertisements in one year, of which seven were found to be in breach.

Ms Moldrich —Yes.

Senator CROSSIN —So if we try to put this into some perspective here, we are actually talking about a huge number of advertisements and a very minute number of issues or complaints. Would that be correct? It would probably be less than one percent?

Ms Moldrich —Yes, it is 0.1 per cent.

Senator CROSSIN —So that is your basis for putting to us two issues: that the self-regulation scheme works and there is no reason to include advertising, whether it is on television or outdoor media, into the National Classification Scheme?

Ms Moldrich —Yes.

Senator CROSSIN —I am just trying to crystallise it.

—We also think that the codes that we subscribe to are very similar to the National Classification Scheme codes. It is not that our codes are any different.

Senator CROSSIN —Let us explore that a bit. So, of your seven that were found to be in breach of the AANA code of ethics, can you just give us a bit of a snapshot of what that content was or why they were in breach?

Ms Bain —I have got some detail I can provide for the committee in relation to that. The relevant code clause for the majority of those complaints was clause 2.3 of the code of ethics. The majority of those seven were advertisements from the sex industry, and they were dealt with under clause 2.3 of the code, which is the clause that deals with the requirement to treat sex, sexuality and nudity with sensitivity to the relative audience. There was also an advertisement for a clothing company which was complained about on the basis of the image portrayed of the woman, what she was wearing and the context in which she was portrayed. There was also an ad from a dating company that runs a dating service with a slogan ‘Life is short, have an affair.’ They are the types of ads that were complained about and found in breach.

Senator CROSSIN —And you are saying that those companies immediately removed those advertisements once they were found to be in breach?

Ms Bain —Yes. The ASB has reported that there is a very high level of compliance with their decisions. Immediately following an Advertising Standards Board meeting where breaches are found, their CEO calls the relevant advertiser and has a discussion with them in relation to the particular matter. As I noted, there is an almost 100 per cent compliance rate with the decisions of the Advertising Standards Board across all media.

Senator CROSSIN —Mr Leesong, I wrote down something you said during your initial presentation—I hope I recorded it accurately. It was something along the lines that classifying provides challenging and administrative burdens. Can you elaborate on what you meant by that?

Mr Leesong —Yes. When an agency puts together a campaign it is usually an integrated campaign that has six, seven or eight different channels. So TV might or might not be part of that. The TV lead time with the budgets involved tends to be a bit longer so you can go through a more formalised process, but when you are dealing with some of the other media—whether it be outdoor advertising, some of the magazine deadlines or the newspaper deadlines—actually classifying that information can be very challenging. An agency may well be briefed the day before deadlines saying, for example, ‘We need an advertisement on the circus coming to town. It needs to go in tomorrow’s Sydney Morning Herald.’ The ability for that to be classified would be very limiting; it would actually put a stop on commerce. We think it would have significant impact.

Senator CROSSIN —So can I just explore that. If I am going to launch a new brand of perfume, for example—however I may depict that in my advertisement—do I have to go through a different process for TV advertising than I would say, to put it in a woman’s magazine?

Mr Leesong —Yes, you would. You would have to get a CAT clearance.

Senator CROSSIN —Even though it might be the same picture, the same slogan, the same message?

Mr Leesong —Yes. But what an advertisement is assessed against for TV, given it is a moving image and so fourth, can be quite different to a still image.

Senator CROSSIN —I see. Would it not be better if there was one body that looked at all of that or is that impractical?

Mr Leesong —We believe it is impractical. When you are dealing with 33 million advertisements it is just a huge undertaking.

Senator CROSSIN —Where is the roadblock then? How do you get over this? You are saying it is a challenge and it is an administrative burden.

Mr Leesong —Currently the scheme does not dictate that you have to have pre-vetting or pre-classification of other mediums. Television is a different case. But if you are putting an outdoor advertisement up, you can put it up. The complaints mechanism is still in place, so if it is complained against then you have got to be held accountable, but it is a different system to pre-approving every single piece of communication.

Senator CROSSIN —You are saying to us: leave it as it is; do not go to a pre-classification system before you launch your advertisement because that would be cumbersome, challenging and an administrative nightmare. Just leave it as it is; the system is working.

Mr Leesong —Yes. That is our submission.

Ms Bain —Can I just add to that if I could. In relation to advertisers preparing their campaigns and talking to their creative agencies, there is a dialogue in relation to the codes and how the codes would be applied by the ASB if and when there was a complaint. It is a very healthy dialogue and, as Mr Leesong has pointed out, there is also a very targeted education campaign. So throughout that process, in a sense the industry bodies are educating the advertisers about the code provisions. In doing so, it is an informal clearance process. I do not want to call it a ‘clearance process’ because it is not required, but there are those checks and balances on the way through.

Mr Leesong —That is interesting: our members call us quite frequently if there is a bit of a grey area that they are unsure about, and we can give them some unofficial guidance. From an agency’s perspective, it is a very competitive industry and business is very hard to win. There have been a number of cases where advertisements or campaigns have been found in breach of the code, and that has been terminal to the business. They have lost the account. That, for an agency, can have significant ramifications.

Senator CROSSIN —There have been times where the ramifications have had a major impact which have made advertising agencies go under?

Mr Leesong —The impacts are twofold. The advertiser wastes, in some cases, hundreds of thousands of dollars in the campaign development process. National TV campaigns are not cheap to put together. Some times the agency has to foot the bill, or they lose the account entirely.

Senator CROSSIN —Ms Moldrich, you talked about the situation where a minority in the community did not like some of the outside advertisements—it probably impinges on, I guess, their moral values. Do you believe the self-regulation of the industry had got that balance right? Or is there room for improvement?

Ms Moldrich —Yes, to both questions. If you look at what we post—the number of complaints and the number of complaints that are upheld—we are adhering to the codes. The codes are a good test of community standards. The ASB is comprised of people who come from across the community and they are the adjudicators of these standards. Can we do more? Can we not have seven cases upheld? Yes, absolutely, we can do more. Rather than more regulation we need to look at more education. Certainly from OMA’s point of view, we are looking to the ASB, so we run mandatory education seminars for all of our operators so that they understand the codes as well as how community standards change. It is not something that is set in concrete, and the ASB are doing research into that. We as heads of those industry organisations are very aware of those issues. We need to pass that knowledge down to our members. Education is the key.

Senator CROSSIN —Is one way around it ensuring that all outdoor advertising has a G rating?

Ms Moldrich —In the majority of cases, outdoor advertising is G rated—without a rating system. But G rating does not just imply that there will not be any themes of nudity, sexuality or language; it is in the context of the ads, it is in the context of the products.

Senator CROSSIN —Are you saying you could have a G-rated advertisement but it could still have some sexuality connotations in it?

Ms Bain —Certainly under the National Classification Scheme, under the G criteria, some references to sex and some forms of nudity are permitted in that classification zone. Our view is that to apply the G classification criteria to outdoor advertising would be a very heavy regulatory stick for what is a very small number of breaches found.

Senator CROSSIN —You have currently got an extensive review of your codes, is that because they are reviewed regularly or because you feel there are elements of the system that are not functioning effectively and it is time to do a bit of a spring clean?

Ms Bain —The reason AANA is reviewing its code of ethics is that we hold the view that a self-regulatory system needs to include a robust review process on a periodic basis. This is the first full-scale review we have conducted of the code of ethics since it came in in 1997. There have been amendments but this is the first time we have had a large review of the code. We found that process to be very useful in terms of telling us how the code is being perceived in the community and by industry and we found through that process that there is a very high level of community satisfaction with the code. As a result of the code review process there are a number of issues that have been raised which then have flow-through effects to the other codes—the code of marketing and advertising to children and the food and beverages code. There are some common themes throughout the codes and we have found that through the code of ethics review some further work and review needs to be conducted of those other two codes. We will be doing that this year with the independent reviewer.

Senator CROSSIN —Should it have been reviewed prior to now—12 to 14 years on seems like a long time before a major review.

Ms Bain —We do not feel that the code was out of date; there is a high level of community satisfaction with it. We are of the view that it has been operating and working well and providing appropriate community standards as a result. Because the review has shown that high level of satisfaction, we do not think an earlier review was required. But we do feel that it is time that that review process was undertaken.

Senator CROSSIN —Do you get a sense that there will be some major redrafting or just some fine tuning to modernise and update some of the sentiments?

Ms Bain —There will not be a major rewrite or review of the code because of the high level of satisfaction. There will be some technical drafting changes coming though, and some changes in concept coming out of the review process. Importantly, one major area of feedback was that people were seeking further guidance on the code and how it applies, and AANA will be putting together a guidance or practice note to sit along side the code of ethics so that industry and consumers can see and understand how the provisions were intended to be interpreted and how the ASB has applied those.

Senator CROSSIN —Ms Moldrich, you were saying that you believe there needs to be more education of advertisers coming to you. Do you need to be running education campaigns on your code, and how to comply with it?

Ms Moldrich —Each of us do various forms of education. The AANA deals with advertisers, the Communications Council deals with the creative agencies. We are the people who post those ads—so we are the end product, really. We post those ads on billboards. They have been through a process by the time they arrive into our formats. What we do is a prevetting system. So there is a check and balance when it gets to us. We need to educate our members on how the codes are being interpreted by the ASB, what community standards are, and what the community is currently thinking about? It is a very changing and evolving code. It is a live code; it is not set in concrete. It is subjective—advertising is a very subjective medium. What I would consider to be okay you might not consider to be okay. What we understand is that the codes are for all people and the ASB represents the community’s view.

Ms Bain —Certainly, as a result of this inquiry, we will see these three organisations coming together to look at some targeted education campaigns, particularly in relation to outdoor media. We have heard now the community concern and we will look at rolling some integrated education campaigns into our educational programs.

Mr Leesong —We are not starting from zero base here. Our organisation alone hosted over 50 seminars around Australia on this exact issue. As well, we train 700 to 800 people a year through our university arm, AdSchool and AWARD School. People who do those courses are also educated on the code of ethics and how they relate to good business practice. So extensive work has already been undertaken. We think we can rack it up a little bit more, but off a good base.

Senator CROSSIN —Do you regulate advertisements on the internet?

Ms Bain —The codes apply across all media. They are not media specific so, yes, they do.

Senator CROSSIN —When you open up a webpage, occasionally, two seconds into it an ad will pop up whether you want it or not. Apart from the fact that it drives me insane—

Mr Leesong —It is a controversial form of advertising.

Senator CROSSIN —I agree with Screen Australia, I like to control what I watch when I watch it. Do those ads need to be run past you before they are placed on that sort of portal? If they pop up and you do not like them, do you have to make a complaint about them?

Mr Leesong —It is a part of the self-regulatory system. Often those advertisements are on TV as well. Often they have been given a CAD approval number. It is not a requirement but there is often duplication.

Senator CROSSIN —If you found that those ads were inappropriate would you, as a consumer, need to make a separate complaint?

Mr Leesong —Yes, just like any advertisement.

CHAIR —I have a range of questions and we are limited somewhat by time so I am going to be as swift as I can and, likewise, if you can assist. If you need to take the questions on notice, feel free. That may assist in timing. In terms of the Senate Standing Committee on Environment, Communications and the Arts inquiry into the sexualisation of children in the contemporary media environment that you, Ms Bain, mentioned in your opening remarks—for which I am thankful—you indicated the response to that inquiry. Did you all provide a response? I am interested in further and better particulars of the response that you provided to the Senate inquiry, which was, frankly, a bit of a hallmark inquiry. It made a lot of recommendations. You may not have made any response to the recommendations but obviously the AANA have. Are you able to outline to the committee, either now or on notice, what responses you have made?

Ms Bain —Specifically in response to the inquiry, AANA reviewed and amended its code of advertising and marketing communications to children. That was a direct result of that review.

CHAIR —Could you be more specific? I would like to know exactly.

Ms Bain —I can take you through the changes.

CHAIR —Are you able to do that on notice?

Ms Bain —Yes. I can give you the changes now or I can provide them for you in written form.

CHAIR —Will that be a short response now?

Ms Bain —It will be very short. I will paraphrase the amendments. They state that advertising and marketing communications to children must not include sexual imagery in contravention of prevailing community standards and must not state or imply that children are sexual beings or that ownership or enjoyment of a product would enhance their sexuality.

CHAIR —Was there anything else or was that pretty much it?

Ms Bain —As a result of those amendments to the code of ethics—and this predated my time at AANA—there was some training in relation to those changes and to that code in conjunction with the Communications Council.

CHAIR —Ms Moldrich or Mr Leesong, would you like to respond?

Mr Leesong —Broadly, they were related to the codes and the way they are interpreted. So AANA’s modification of that was then relayed through our organisation to practitioners.

Ms Moldrich —For the Outdoor Media Association, the major issue that arose from that code and what was used in determining complaints was that a higher standard be used when looking at outdoor advertising in view of the broad audience. The ASB brought that into play. But I can take on notice how we responded to that.

CHAIR —Yes, if you could. Are you referring to  AANA changing its code?

Ms Moldrich —And the way the ASB has then looked at complaints for outdoor advertising as a consequence of that change.

CHAIR —If you can be a little more specific on notice, that would be appreciated. To the AANA in regard to the review, I just wanted to get a quick update. When is the report due?

Ms Bain —We are looking to release the code and Dr Beed’s report before the end of this financial year, so we are probably looking at May or early June

CHAIR —So you are going to release the revised code and his report simultaneously?

Ms Bain —Yes. I am not sure at this stage how much detail we will provide in terms of his report, but we will certainly provide a summary of that. We are working through the drafting amendments to the code at the moment and working that through with several key stakeholders. That process is in train.

CHAIR —Based on his report?

Ms Bain —Based on this report and the outcomes of his review and also taking into account evidence given in this inquiry and the House of Representatives inquiry.

CHAIR —Has he concluded his report?

Ms Bain —He has concluded the formal part of his review but he is also observing and participating in this inquiry and the House of Representatives inquiry.

CHAIR —That is fine, but has he concluded his report and submitted it to the AANA for review?

Ms Bain —He has.

CHAIR —When was that done?

Ms Bain —About a month ago.

CHAIR —My understanding is that the original aim was by the end of last year.

Ms Bain —By the end of February 2011 we hoped to have the whole thing wrapped up.

CHAIR —Sorry, by the end of February. So he got it in in March. You have got the report but he is now participating in these two inquiries and reviewing what comes through and I assume making additional comments to his report. Is that right?

Ms Bain —Correct.

CHAIR —Can you outline, either now or on notice, his report and his recommendations or the key outcomes of his report? We are very interested in his report.

Ms Bain —I can take that on notice.

CHAIR —We would like either the report and its recommendations or an overview of that, if that is a matter you can take on notice and talk to your people at the AANA about. Thank you for that. On this issue of uniformity, the merit of having the same standards for the same content across different platforms has come up with previous witnesses. Do you support that principle?

Ms Moldrich —Yes, we do.

Mr Leesong —As a principle, absolutely. The devil is always in the detail as to what that means in the practical aspects of delivery.

Ms Bain —Yes we would, but we would note that for some media, for example outdoor, the classification scheme should not be laid over that system as an additional layer of regulation.

CHAIR —That is a pretty big exemption there. I am just looking at the code and the four key principles and I am really asking whether you think we should add that. There is a view that perhaps we should add uniformity, or words to that effect, in terms of the principles. Do you think that is a good way to go or do you think that is going too far? Do you have a problem with it or do you not have a view?

Ms Moldrich —The principles are fine. I think, as Daniel said, the devil is in the detail. If you look at the current self-regulatory system, it is essentially underpinned by the same principles. It is not like we are working in isolation to the classification principles. They are still the same principles; that is the underpinning of it. We do that in a self-regulatory environment.

CHAIR —We touched on the G rating earlier in conversation with Senator Crossin. I have got the G rating here in front of me. I think you were making the point that nudity is possible under a G rating but it should be justified by context. I also note that sexual activity should be very mild and very discretely implied and be justified by context. In terms of outdoor media advertising, there is a view that has been put that we should have a G rating across the board. I think, Ms Moldrich, you indicated that the bulk of the outdoor advertising as far as you are concerned is G. But you are indicating that perhaps some of it is higher than G and therefore G should not be appropriate. I just want to flesh that out with you in terms of the G rating.

Ms Moldrich —I think putting a rating system into a self-regulatory arena that is working very well, when we have 99.98 per cent of our ads complying with the codes, is a very onerous thing to do. It needs to be a lot more evidence based as to why this would—

CHAIR —Is it onerous if it is already G rated?

Ms Moldrich —There are campaigns in the majority that are G rated, but there are also campaigns like the latest one run by the Australian government on the harms of ecstasy. That would not be G rated. There are films like Harry Potter that are—

CHAIR —Just to clarify, would that pass your test and be okay for outdoor advertising?

Ms Moldrich —Yes, absolutely. This has been posted recently. There are quit smoking campaigns that would not be G rated. So I think adding another layer to a system that is working very well is compliant. When we misjudge that—and I take the view that from time to time we misjudge that—we do pull those ads down.

CHAIR —Let me clarify: do you think outdoor advertising should be allowed for both the smoking and ecstasy ads? Do you think outdoor advertising is appropriate? What rating would apply?

Ms Moldrich —It is not in my purview to rate ads, so I do not really know. Yes, I think if a product or a message—

CHAIR —With respect, you must know. If you are saying it is okay for outdoors, you must know what level of rating would apply to that ad.

Ms Moldrich —I would not know whether that was an M or a PG. I think it is above G, if that is the opinion you are wanting. But, if you want me to be more precise, I do not have either the training nor the guidelines—

CHAIR —But it would be one of those two, in your view?

Ms Moldrich —Yes, in my view.

CHAIR —It would not be more than M, would it?

Ms Moldrich —No.

CHAIR —It would either be PG or M, the next level up.

Ms Moldrich —Yes, and we look to the ASB to give us those guidelines, and we look to the codes to set those guidelines.

CHAIR —All right. As we have previously discussed, the House of Representatives inquiry is going on at the moment. There has been evidence put to that committee in terms of some of the ads being very sexually full-on, raunchy and that sort of thing. What do you say to those concerns, when people say, ‘It is way over the top’? I think there were some examples of that in another arena. How do you respond to that?

Ms Moldrich —In my opening address one of the things that I said is that it is actually a popular myth that outdoor advertising is dominated by a multitude of inappropriate images. In fact, that is not the case. From time to time, products are advertised, like lingerie , which uses imagery that members of the community could find offensive. But what the ASB does is look at the entire community and it looks at commercial interests and it looks at the codes. As long as the codes are there and the codes underpin the principles of the classification system then we have to be guided by that. No system is 100 per cent foolproof.

CHAIR —Based on what you have shared then and your responses to the examples you have used with ecstasy and smoking, it is okay for outdoor advertising to be at the level of M.

Ms Moldrich —I am not in any position to make that value judgment, I do not think. I think that I have to leave it to the codes, because we work to the codes and we look to the ASB to being the agency that looks at how advertising adheres to those codes. We post ads that come from advertising agencies for legitimate legal products, and there are codes in place. We manage through those codes. There is a complaints process in place and we sign up to that complaints process.

CHAIR —I will give you an example. The Australian Council on Children and the Media provided to the committee, in response to a question on notice, examples of outdoor advertisements, one of which was on a bus, one on a billboard, so at least these two may be third-party advertisements and relevant to OMA. They were overtly sexual and the advertising standards bureau had dismissed claims in relation to them. I am not sure if you are aware of those examples. Do you think that the objectification of women is a concern, particularly in relation to outdoor advertising?

Ms Moldrich —I have those two examples. You are talking about the Bardot denim ad and the drink Sprite ad. As I said, I do not make those value judgments. I think that the public have every right to complain about these ads, about any ad really.

CHAIR —But the complaints were dismissed.

Ms Moldrich —There was a complaint recently about an ad where a mother was changing a baby’s nappy. Someone complained about an anti-cancer ad. That is the right in a democratic society for people to complain. Then you have a process where those complaints are looked at. In the case of both these ads, the ASB dismissed them because they did not see them as being overtly sexualised. We look to the ASB and the board, which is comprised of 20 people, one of them works in gender studies—

CHAIR —So you think they made the right decision. You are happy with their decision.

Ms Moldrich —I am neither happy nor sad about their decision. I respect their decision.

CHAIR —Do you support their decision?

Ms Moldrich —Do I support it personally or as the OMA?

CHAIR —As the OMA. You are speaking on behalf of them.

Ms Moldrich —Absolutely I support their decision.

Senator CROSSIN —Is that an example of the advertisements there? Can we have a look at them?

Ms Moldrich —Are these the ads that Women’s Health linked or raised an issue about?

CHAIR —Yes. The photocopy is not so good. I am aware of the ads.

Mr Leesong —I think the key issue there is that the ASB system is set up to actually handle and adjudicate the complaints and we as bodies support that process. The actual specifics of do we agree or disagree with decisions, they are issues that need to be raised with the ASB and their reasons behind those decisions.

CHAIR —I appreciate your views, I respect your views. I am interested in your views as to whether you think those that are appropriate or not, in the public arena on billboards. You have shared your view that you support the ASB on it and I respect that too. That is not a problem.

You mentioned earlier about the ASB and the high compliance, Ms Bain, and obviously you are pleased with the high compliance, but sometimes there is noncompliance. What happens in that situation?

Ms Bain —There have been from time to time examples where a decision of the Advertising Standards Board has not been complied with and the CEO of the ASB, Ms Jolly, has a process of following through with the advertiser. In the case of billboard and outdoor advertising, from time to time she has approached, for example, local councils and local government to talk to them about the particular advertising campaign. But we say the high level of compliance shows that the system is working and working very well. There are a small number of cases and I think Ms Jolly has provided evidence to the House of Representatives inquiry of one particular example. I am sure she could provide some more detail for you on her processes there.

CHAIR —What do you do about the noncompliance? How do you follow up? It is a voluntary code, isn’t it?

Ms Bain —It is a voluntary code and it is a voluntary self-regulatory system but, as other members here have stated, it is in advertisers’ interest to show that the system is working and working well. The ASB has provided one example where in the outdoor space the advertiser refused to take down the advertisement. It was actually a sandwich board, as I understand it, that had been up for many years and received one complaint and the owner of that sandwich board refused to take it down. Ms Jolly in her capacity as the CEO of the Advertising Standards Board has approached the local council in that regard.

Ms Moldrich —All of our members for these examples are first-party advertising or on-premise advertising. These are not our main members. Our main members have 100 per cent compliance.

CHAIR —I will come back to that. I will just check if Senator Crossin wanted to follow up on those photos.

Senator CROSSIN —No, I just wanted your reaction to the Women’s Health Victoria submission, and I think we have covered that.

Ms Moldrich —One of those images that you were looking at, which is the Calvin Klein ad, was upheld.

CHAIR —But you are confirming that the ‘Drink Sprite, look sexy’ ad was dismissed by the Australian Standards Bureau?

Ms Moldrich —Yes.

CHAIR —I find that staggering, frankly. With your advertising outdoor, that is to your members, isn’t it? On pages 8 and 9 of your submission you have given evidence regarding Parramatta Road—for which we are very thankful—where 2,140 of those ads were on-premises signs compared to 14 third-party advertisements, and you have a couple of photos in your submission. How are on-premises signs regulated, if at all?

Ms Moldrich —On-premise and first-party advertising do not have a body like us who regulate.

CHAIR —Exactly.

Ms Moldrich —They do not sign up to any of the codes. There are in fact hundreds of thousands. They are the signs that proliferate Australia. It is not third-party signage.

CHAIR —That is right and they are unregulated. Is that correct?

Ms Moldrich —They still fall under the regulations. So if you are a member of the public and want to put in a complaint about an on-premise sign, you can and the ASB administers it. In fact, the ASB upheld eight complaints about on-premise ads last year. The fact that they do not have an industry body is neither here nor there; the code still applies to them.

CHAIR —There is a view that once the complaint has been heard it is basically too late. I am not sure what the average length of time is for an ad. I think this was referred to by the Australian Council of Children and the Media. What would be the average time for a billboard ad?

Ms Moldrich —There is not an average time. Billboards are posted every lunar month, but that does not necessarily mean that every lunar month the ad is changed. Some campaigns last for three or four months and some campaigns go for years. In terms of the turnaround rate, I think that the ASB use a best practice model and they have very high turnaround rates.

CHAIR —But weeks or months?

Ms Moldrich —Weeks or days sometimes.

Ms Bain —For complaints coming before the ASB which the secretariat regards as urgent, Ms Jolly can convene the board and have a decision within 24 to 48 hours for those types of advertisements.

CHAIR —Just going to the communications council: Mr Leesong, on page 8 of your submission you made reference to the gender portrayal objectification. So that is the objectification of women?

Mr Leesong —Yes.

CHAIR —And then there is body image. You have that in your submission to highlight what key points? Is it that they are concerns for your industry and that you are addressing them appropriately?

Mr Leesong —Going back a number of years it was quite a hot-button topic. It really just demonstrates the way that we approach keeping current with community expectations and community attitudes and what we do if issues are raised. Gender portrayal is a good one. The education campaign around how best to communicate your message without overstepping the mark is something that we are pretty proud of. You can look at individual examples of ads and there will be some come through the cracks that do make it through. Whether they were done by an agency or not is probably another question. Sometimes they are and sometimes they are not.

CHAIR —But you agree those two areas are areas of sensitivity—the objectification of women and sexualisation of kids?

Mr Leesong —Absolutely. We take it very seriously. In the vast majority of brand cases it can be terminal to the brand equity and the brand value if you get that sort of messaging wrong.

CHAIR —Are you familiar with the St Kilda Junction, Melbourne group scene billboard which was taken down because of the end of the campaign?

Mr Leesong —Sorry, I have not seen that one.

—Is that the Calvin Klein ad?

CHAIR —I think it is Calvin Klein and they were wearing—

Ms Moldrich —It was upheld by the ASB.

CHAIR —As appropriate?

Ms Moldrich —No. The complaint was not dismissed; the complaint was upheld and the campaign was brought down.

CHAIR —It was brought down, but that was at the end of the campaign. How many weeks or months did it stay up?

Ms Moldrich —I will have to take that on notice.

CHAIR —Would you check for us how long it stayed up during the course of that campaign?

Ms Moldrich —Yes, certainly. Sometimes the complaints do not necessarily come at the start of a campaign. We recently had an ad where the complaint was upheld and that ad had been in the marketplace for two years. So it does not necessarily follow that the complaint arrived on the first day that those billboards went up. The complaint may have arrived at the end of the campaign. I will take that on notice and check all of those facts for you.

CHAIR —Thank you so much for that. I have a question for the AANA which you may have to take on notice. Please provide the committee with more information in relation to the nine advertisements which were found to be in breach of the AANA code in 2010. It is referred to on page 21 of your submission. I would like to know the outcome of the breaches.

Ms Bain —The outcome of the breaches was that the billboards were brought down by the advertiser following notification by the Advertising Standards Board. The figure I gave in the submission is actually the one that I corrected earlier.

CHAIR —From eight to seven?

Ms Bain —Correct. I provided an outline of the content of those advertisements to Senator Crossin.

CHAIR —What happened to those advertisers that breached the code, apart from the advertisements being brought down? Is there any other sanction?

Ms Bain —No, there is no system of sanction and penalties. As Mr Leesong has outlined, the self-regulatory system relies upon advertisers wanting to do the right thing. Because of the cost of these campaigns no advertiser wants a campaign to be brought down midstream. That contributes to the high level of compliance.

CHAIR —On page 15 of your submission you discuss the introduction of a formalised training session with members and service provider organisations. I am interested to know how those training sessions are formalised.

Ms Bain —Those training sessions will be brought into place once we have finalised and released the review of the code of ethics. We will conduct some formal training programs with our members and also in conjunction with the Communications Council and their accreditation program.

CHAIR —Will it be compulsory?

Ms Bain —No.

CHAIR —What is the rate of take-up for training opportunities across the industry?

Ms Bain —We have not launched those training programs as yet, so I am unable to provide you with those figures, although Mr Leesong through his accreditation program can probably provide you with some details.

Mr Leesong —Basically, accredited agencies comprise 80 per cent of the large agencies in Australia. Part of their undertaking to become accredited is to sign up to this training and provide all their key staff with 15 hours per annum of professional development. This specific training plays a key part in them maintaining their professional development points.

CHAIR —Fair enough. Does the AANA support a G rating for outdoor billboards?

Ms Bain —No, we do not. We are not of the view that a classification system is required in the outdoor space, as a result of the high level of compliance.

CHAIR —Thanks for your feedback on that. Page 17 of the Outdoor Media Association submission refers to the internal reviews of advertisements before they are displayed. Would you share with the committee how the internal review process works.

Ms Moldrich —Each of our media display owners have their own internal pre-vetting system where ads are looked at, especially adds that we think may be in breach of the code. We also have an informal system where, if their pre-vetting system has looked at an ad and still is not clear about it, they talk to me about it. I also look at those ads and talk to the ASB. We are getting more diligent with that process since these reviews, because it has given us a chance to really scrutinise why those seven ads were misjudged. We take that matter very seriously. It is not great for business to have an ad come down.

CHAIR —Let us use an example. Did the two ads that the Advertising Standards Bureau said were absolutely fine—the drinks one, bright, look sexy; and the Bardot denim one, which we have here and I am staggered by their decision—come to you in the review process?

Ms Moldrich —No, neither of those ads came to me.

CHAIR —So it would have been reviewed internally by which organisation?

Ms Moldrich —If those organisations felt that it did not comply with the code, yes, it would have been reviewed internally.

C and HAIR —Just to clarify: it would have been reviewed internally?

Ms Moldrich —Yes.

CHAIR —Are you able to identify the organisations?

Ms Moldrich —No, I am not. I do not know who posted those ads.

CHAIR —But it would have been one of your members?

Ms Moldrich —Yes, absolutely.

CHAIR —You do not have total coverage but you do have dominant—

Ms Moldrich —We have 97 per cent coverage—and those two ads in question were posted by our members. But I could not name them.

CHAIR —Excuse my ignorance, but is it inappropriate to know that?

Ms Moldrich —I really don’t know who they are.

CHAIR —Can you take that on notice?

Ms Moldrich —Yes, I can take that on notice.

CHAIR —So complaints came in and it went to the Advertising Standards Bureau. Can you give us any further particulars regarding the timing of that—when the complaints were made, how many complaints, how long it took the bureau and when the decision was made?

Ms Moldrich —Yes. I can also give you the case notes on each of those.

CHAIR —Thank you. The committee will break for a few minutes.

Proceedings suspended from 10.36 am to 10.51 am