By Dr. OC Ferrell and Dr. Linda Ferrell

Industry self-regulation exists when members of an industry, trade association or sector of the economy establish and monitor adherence to legal, ethical and/or other standards (best practices) to reflect effective consumer protection, ethical industry performance and meet public policy requirements. Self-regulation provides a mechanism to respond to legal, regulatory and ethical issues that provide fair competition and enhance the reputation of an industry. Compliance with these standards is not just for industry trade association members, but all participants in the industry or channel. Self-regulation, using third party oversight, facilitates addressing non-compliance of the entire industry by working with government agencies such as the Federal Trade Commission (FTC) (Soft Law Summit: Activating Industry Self-Regulation, 2023). This research provides an overview of the objectives of self-regulation and reviews the activities and components of leading self-regulatory programs to provide a template for evaluating the Direct Selling Self-Regulatory Council (DSSRC), which serves as an industry-wide self-regulation program for the direct selling channel.

Overview of Self-Regulation

There has been a general movement against government-imposed rules globally. The main focus of government deregulation is to promote economic efficiency, competition, and innovation in the business sector. While deregulation initially reduces costs and increases profits for business, critics often claim it can lead to unintended social costs. For example, deregulation in the energy sector has generally led to increased competition, innovation, and market openness, but its short-term effects on lowering electricity prices are inconsistent, and it can expose consumers to higher risks and reduce regulatory protections (Necoechea-Porras, López, & Salazar-Elena, 2021). Politicians, both left and right, globally, have embraced deregulation. The European Commission (EC) pledged to cut reporting requirements by at least 25%, and 35% for small and medium-sized firms. Vietnam is in the process of abolishing 25% of government agencies. In the United States (US), President Donald Trump issued an Executive Order to eliminate 10 regulations for every new regulation added (Economist, Feb 1, 2025. “The War on Red Tape (Rule Breakers)”.

Nowhere has there been a greater reduction in government regulation than in Argentina. The country has taken 800 steps to reduce regulation with more structural reforms to come. Certain imports into Argentina have seen a significant drop in prices as a result of the government’s efforts. These examples illustrate that self-regulation coupled with government deregulation can improve the efficiency of economic systems. Since taking office, Argentine President Javier Milei has issued roughly two deregulation reforms per day on average, including weekends (Vasquez, 2025). As government deregulation continues, industry self-regulation can shift some monitoring and oversight responsibilities to the private sector, including industry trade associations.

Regulation is even more problematic for the small businesses and independent contractors that typically drive market innovation because they often lack the resources to address complicated regulatory rules. Many small businesses say that dealing with regulation hinders growth and takes up too much of their time (Swanek, 2024). Small businesses and new firms are typically most impacted by inefficient regulation (Cordes, Dudley, and Washington, 2022). Additionally, regulation can reduce incentive to innovate. A study of mandatory financial disclosures in Europe found that requiring companies to publish detailed financial reports discourages innovation, particularly among smaller firms, by exposing proprietary information, which reduces their incentives to innovate (Breuer, Leuz, & Vanhaverbeke, 2025).

Complex regulations can stifle flexibility, making it harder for companies to adapt to changing market conditions, distribution methods, technology or consumer behavior. Additionally, rapid changes in technology can make some regulations obsolete. There is no doubt that resources used to monitor, report and comply can increase costs and prices to consumers. It is difficult to eliminate regulations that are obsolete and a cost to society, and the United States seems to fall behind many other developed countries in actively working to cut red tape and speed up regulatory processes (Cordes, Dudley, and Washington, 2022). In addition, regulation can limit consumer and business options and decrease competitiveness. On the other hand, government regulation, such as antitrust laws, are essential for maintaining a level playing field, promoting fair competition and ensuring markets remain competitive (Sokol & Zhou, 2024). Regulations also protect consumers from criminals who engage in fraud and exploitative practices. Some regulations are necessary to protect general public interests, including health and safety, environmental issues, unsafe products and workplace safety. Self-regulatory bodies do not have the authority to enforce laws, regulatory rules or legal actions to stop misconduct in most cases. Self-regulation programs, hand-in-hand with government regulation can work together to promote responsible business conduct.

Industry members committed to ethical and socially responsible conduct have the potential to provide more insights into the efficiencies of practical standards, more than those developed by governments. Government regulation is often developed to restrain a few rogue firms that have engaged in misconduct, but it can result in costly compliance with rules that impede the efficiency and effectiveness of the entire industry. Effective self-regulation with independent third-party oversight can help educate members of an industry about compliance and misconduct as well as educate participants on ethical conduct and best practices. Self-regulation tends to be more effective when outside groups, like industry organizations, independent auditors, nonprofit watchdogs, and government partners, are involved to provide oversight and support (Maman & Feldman, 2025). Firms that refuse to stop engaging in misconduct can be referred to government regulatory agencies such as the US Federal Trade Commission (FTC) to protect consumers as well as other industry participants. Self-regulation can fill gaps in areas where even the government is limited due to resource shortfalls and the need to focus on the most egregious of cases. This illustrates how self-regulation and government regulation can work together to assure responsible conduct. Effective self-regulation involves monitoring and addressing the conduct of all members of an industry.

The Case for Industry Self-Regulation

Self-regulation has many advantages over government regulation. First, it can educate the industry on standards to prevent and correct misconduct. Self-regulation offers flexibility and allows organizations to respond quickly to evolving practices, including new technology (Platt Majoras, 2025). Gaining cooperation with government agencies and other stakeholders provides a balance of responsibilities and most effectively addresses challenges. All stakeholders gain from the resources an industry invests in self-regulation. The industry benefits through proactive risk management and enhancing its reputation with key stakeholders and government regulators can use their limited resources more effectively.

Self-regulation can take place within individual companies, across entire industries, or within the broader business community as part of the economic system (Hemphill, 1992). Trade association self-regulatory initiatives provide guidance beyond legal requirements. Companies with high ethical standards go beyond legal compliance. These ethical standards and expectations create a buffer zone to prevent employees or representatives from engaging in misconduct. All firms have mandated requirements from laws and regulations. Business ethics programs and industry standards go beyond just compliance with the law. In business, states often have conflicting regulations and specific laws for an industry. Therefore, while these laws and regulations must be obeyed, holding firms to a higher standard can be helpful in avoiding legal issues.

Industry participants develop core practices that account for the legal dimensions while also incorporating self-regulatory standards and addressing the concerns of stakeholders. For example, the BBB National Programs (BBBNP) is an important self-regulatory body that provides directions for managing disputes, and the National Advertising Division (NAD) reviews advertising cases involved in disputes. Core practices in industry self-regulation programs evolve as they gain acceptance and reflect the expectations of key stakeholders. Core practices could also be considered norms that are behavioral expectations not legally required. The US government encourages industries and firms to establish proactive ethical standards that are core practices. Chapter 8 of the Federal Sentencing Guidelines for Organizations requires the board of directors to be responsible for ethics and compliance activities. If misconduct occurs, firms are given incentives, such as reduced penalties, if they can demonstrate an effective ethics and compliance program (United States Sentencing Commission, 2024).

Trade associations play a role in shaping industry-wide corporate social responsibility, especially in highly regulated and scrutinized sectors (Schaefer & Kerrigan, 2008). In addition to setting ethical expectations and advocating on behalf of members, trade associations may also establish voluntary standards or promote practices that go beyond the legal requirement. This includes engaging in philanthropic activities, giving back to communities and supporting employee development and retention through education, training and benefits. When an entire industry faces stronger outside pressure to act responsibly, its trade association is more likely to take an active role in addressing social and ethical concerns (Schaefer & Kerrigan, 2008).

The FTC recognizes the importance of self-regulation in an industry and encourages the adoption of self-regulatory practices (Rosch, 2007). If businesses focus on self-regulation, this allows the government to use its resources on significant competition issues and give best practices advice on issues where the government cannot intervene with its existing resources. The FTC does provide guidance on how businesses can develop effective self-regulatory programs. The FTC also recognizes that business has the necessary hands-on experience that enables it to address many issues more capably than a government agency. Since self-regulation is a quicker, more flexible and less adversarial means to establishing and enforcing standards, the benefits to society are significant. The FTC is very active in assisting and supporting industry self-regulation and establishing standards.

Better Business Bureau and BBB National Programs Leadership in Self-Regulation

One of the most visible and comprehensive industry-level, self-regulatory organization is the Better Business Bureau (BBB), founded in 1912. Through the International Association of BBBs (IABBB), there are more than 180 local offices in the United States, Canada and Mexico. Each bureau, through its offices, provides community oversight for ethical business, but there is limited enforcement of codes and rules. The bureau uses the mass media to warn businesses and consumers of the offending firms. If this firm is a member of the BBB, then membership can be revoked. These programs influence the future of government regulation in a firm’s industry and demonstrates its commitment to being accountable.

By contrast, BBB National Programs is an independent, nonprofit organization with a shared history, but not affiliated with, the International Association of Better Business Bureaus. BBB National Programs, is home to the independent, industry self-regulation programs that were a part of the Council of Better Business Bureaus since the 1970’s.

Industry standards and dispute resolution protect consumers and promote fair competition (BBB National Programs, 2022). These programs not only reduce the need to expand government regulation, but also help firms maintain an ethical interface with their stakeholders. BBB National Programs provides third-party oversight to companies and industries. BBB National Programs has helped many industries develop effective self-regulatory programs. This research overviews the BBB National Programs’ Direct Selling Self-Regulatory Council (DSSRC), focusing on product and earnings claims compared to other industry self-regulation programs.

An example of one of the oldest and most well-known national programs is the National Advertising Division (NAD). While the FTC is in charge of enforcing consumer protection in advertising laws that aim to prevent deception, many of the cases are handled by the NAD. While the NAD operates independently, it takes its cue from the FTC. The FTC could not monitor and enforce advertising deception without the resources of the NAD (Federal Trade Commission, 2009). One reason the FTC supports self-regulation is the number of complaints received each year. In 2024, the FTC received 6.5 million complaints from consumers (Consumer Sentinel Network Data Book, 2024). The most common complaints are related to credit bureaus and information furnishers, identity theft, imposter scams, online shopping and reviews, and banking. It is clear that self-regulation contributes to reducing the FTC involvement in the need for enforcement of laws. Self-regulation can prevent misconduct and gain efficient results with respect to questionable conduct.

Evaluating Self-Regulatory Programs

The FTC prioritizes key elements and characteristics of self-regulatory organizations. These include: the authority to create and enforce its own policies; governance-including independent boards, transparency and a defined process; conflict management to address conflicts of interest with transparent mechanisms for resolution; effective and transparent processes and procedures for oversight and regulating members of the industry; appropriately resourced, technically and advanced surveillance programs; adequately funded enforcement program that polices misconduct; regulatory database of information about outcomes that is accessible to stakeholders; market disruption procedures in case of capacity, continuity or computer failures that impact operations; innovation to stay ahead of the curve; and a dispute resolution process that employee find offers fair and transparent policies and procedures (Evens, 2014).

Each self-regulatory group was evaluated based upon: ethical leadership, independent oversight, clear standards and guidelines, scope and focus of accountability, transparency, education and training and continuous improvement (ongoing risk management). Appendix A provides an overview of each program using this template. The programs evaluated include: Financial Industry Regulatory Authority (FINRA), Distilled Spirits Council of the U.S. (DISCUS), Direct Selling Self-Regulatory Council (DSSRC), Children’s Food and Beverage Advertising Initiative (CFBAI), Children’s Advertising Review Unit (CARU), National Advertising Division (NAD), Online Behavioral Advertising (OBA) and Online Lenders Alliance (OLA). All of these programs focus on advertising, promotion and communication with key stakeholders.

A review of the DSSRC compared to other self-regulatory programs indicates that all of the components of the DSSRC program reflect BBB National Programs’ best practices and the characteristics of effective regulatory programs. With DSSRC managed by BBB National programs, it provides independent, non-profit oversight of the program. The key features of BBB National Programs are accountability, trust, impartial monitoring, enforcement and dispute resolution (Marinello, 2024).

By working with the DSSRC guidelines, direct selling companies demonstrate their commitment to ethical marketing practices, transparent disclosure of material information and the correct positioning of the direct selling opportunity (Marinello, 2024). The DSSRC is strengthening consumer trust and addressing potential misconduct issues before legal and/or regulatory intervention. This proactive approach not only prevents misconduct in the marketplace, often by non-DSA member firms, but also educates these firms about appropriate conduct in the marketplace. While the FTC and state legislation may develop unpredictable rules and regulations, the DSSRC can provide stability in developing and challenging regulations that can best be addressed by self-regulation.

References

Appendix A
Self-Regulatory Program: Core Elements

Direct Selling Self-Regulatory Council (DSSRC)

Website: https://bbbprograms.org/programs/all-programs/dssrc

Executive Director: Peter Marinello

Ethical Leadership: Peter Marinello is vice president of the BBBNP and serves as the executive director of the DSSRC. He brings a wealth of legal and self-regulatory experience from the National Advertising Division and the Electronic Retailing Self-Regulation Program.

Independent Oversight: BBB National Programs’ oversight, auditing and monitoring of product and earnings claims violations ensures a high level of credibility, expertise and effectiveness in program implementation and integration with legal and regulatory frameworks. DSSRC provides third-party oversight in conjunction with clear principles of business ethics set forth by the Direct Selling Association (DSA).

Clear Standards and Guidelines: Clear industry standards on issues such as product and earning representations (Direct Selling Code of Ethics I DSA Business Standards).

Scope and Focus of Accountability Mechanisms: Monitors the entire direct selling channel and embodies the following:

  • Relevant best practices from other self-regulatory models
  • A process that both monitors and enforces strict business principles; and
  • Guidance to raise the bar of excellence for DSA members and the entire direct selling channel

Transparency:

  • Shares summaries of case outcomes over the years (2019-2024): cases referred to the FTC (non-response and non-compliance); number of public case decisions; unique URLs reviewed to expose non-compliance; specific number of COVID-tagged postings; and number of administratively closed cases.
  • Comprehensive 2024 Activity Report with great detail on information on monitoring, origin of awareness of misconduct, nature of the misconduct (earnings claims vs. product claims), location of claims (social media accounts vs. company websites), etc.
  • Providing Code Administration for the DSA involving complaint handling procedures related to concerns about adherence to the DSA Code of Ethics (including annual Code of Ethics Compliance Reports).

Education and Training:

  • Direct Selling Education Foundation (DSEF) Building Trust in the Marketplace Conference (August 29-30, 2023) brought together direct selling industry business leaders, legal professionals, advertising experts, and salesforce members.
  • DSA Direct Selling Compliance Officers Certification and Handbook helps companies stay compliant by offering certification on compliance, best practices, tips and suggestions for new compliance officers.
  • DSSRC provides Earnings Claims Guidance, Income Disclosure Statement Guidance, and field training for companies seeking to establish or enhance their ethics/compliance programs.

Continuous Improvement and Ongoing Risk Management:

  • Recognition of emerging areas of concern (COVID-19 product claims, as an example).

Financial Industry Regulatory Authority (FINRA)

Website: https://www.finra.org/

President/CEO: Robert W. Cook

Ethical Leadership: Robert W. Cook served as the Director of the Division of Trading and Markets of the U.S. Securities and Exchange Commission for three years prior to joining FINRA. Mr. Cook earned his JD from Harvard Law School, a Master of Science in Industrial Relations and Personnel Management from the London School of Economics, and an A.B. in Social Studies from Harvard College. Under his leadership, FINRA helps write and enforce rules to foster an environment of market transparency.

Independent Oversight: FINRA works under the direct supervision of the SEC to protect the investing public against fraudulent and unethical practices. The US Congress has granted the SEC authority to ensure the broker-dealer industry and associated regulatory bodies operate fairly and honestly.

Clear Standards and Guidelines: FINRA’s rules and guidelines ensure a safe and fair market. These rules are constantly changing to adapt to new developments in the industry.

Scope and Focus of Accountability Mechanisms: Plays a critical role in ensuring the integrity of America’s financial system by

  • Writing and enforcing rules governing the ethical activities of all registered broker-dealer firms and registered brokers in the US.
  • Examining firms for compliance with rules.
  • Fostering market transparency and educate investors.

Transparency:

  • Shares information regarding individual transactions in active US Treasury securities on a same- day basis for FINRA members and professionals who subscribe to their data product. This information is made publicly available on FINRA’s website for non-commercial use the next day.
  • Offers several reporting tools based on compliance requirements that allow users to report mandatory trades, view display-only quotes and activity, and easily access and reference the Uniform Practice Code to assess operational and settlement issues.

Education and Training:

  • College of Examinations (COE) and College of Risk Monitoring (CORM): Periodic training programs for entry-level employees that include both onsite and virtual training sessions covering various aspects of the industry.
  • Securities Industry Essentials (SIE) Examination: Passing the SIE is a mandatory prerequisite for beginning employment at FINRA. FINRA’s new-hire training involves integration of SIE exam study materials and resources.
  • FINRA Honors Program: A two-year full-time rotational program open to recent law school graduates and attorneys that provide the opportunity to complete sophisticated legal work and protect investors and financial markets.

Continuous Improvement and Ongoing Risk Management:

  • FINRA maintains a dedicated Risk Monitoring Team including executive Risk Monitoring Director and Risk Monitoring Analyst roles to actively maintain communication with firms and provide prompt and accurate answers to their regulatory concerns.

Distilled Spirits Council of the U.S. (DISCUS)

Website: https://www.distilledspirits.org/

President/CEO: Chris R. Swonger

Ethical Leadership: Chris Swonger is President and CEO of DISCUS and Responsibility.org, a non-profit organization that has raised over $250 million from leading distillers to fight driving under the influence and underage drinking. With over 25 years of experience in the public and private sector, representing elected officials and three diverse, global consumer goods companies, Chris has led integrated corporate affairs strategies with responsibility for public affairs, international government affairs, corporate reputation management, corporate communications, brand public relations, philanthropy, and social responsibility. Upon taking over DISCUS he declared his focus on breaking down the traditional barriers that often separate corporations, non-government organizations, and activist groups.

Independent Oversight: Two critical bodies of experienced professionals, the Code Review Board and Outside Advisory Board, serve to execute and ensure adherence to the Code. For several decades, the Code Review Board has served to evaluate complaints and inquiries about advertising and marketing materials subject to this Code. The Code Review Board complaint process is transparent, and the resulting decisions and actions are regularly published on the DISCUS website. The Outside Advisory Board is composed of highly esteemed professionals with extensive experience related to responsible advertising. The Advisory Board is available to provide anonymous guidance on Code compliance, as well as their opinion if the Code Review Board cannot arrive at a majority decision on a complaint.

Clear Standards and Guidelines: Code of Responsible Practices used as a model of self-regulation, providing rigorous yet fair standards.

Scope and Focus of Accountability Mechanisms: DISCUS code applies to all activities in the United States undertaken to advertise and market distilled spirits, including beer and wine brands marketed by both DISCUS members and non-members. DISCUS regulates the responsible placement and content of beverage alcohol advertising materials and provides detailed guidelines to encourage safe and responsible consumption. DISCUS is more rigorous than the First Amendment has a transparent and accountable process covering the full breadth of advertising and marketing practices.

Transparency:

  • Code Review Board takes complaints and provides decisions and reasoning on certain beverage- marketing issues. These resulting decisions and any further actions are regularly published on the DISCUS website for public access.
  • Companies should provide a copy of their code of ethics to advertising agencies, media buyers, and other external consultants involved in a member’s advertising or marketing activities

Education and Training: DISCUS partners with several esteemed course providers to educate employees and non-employees alike on suitable beverage advertising practices. These courses include Level 1 and Level 2 Awards in Spirits, which focuses on the history of spirits, their significance in the U.S. economy, and the applicable regulations and laws surrounding their advertisement.

Continuous Improvement and Ongoing Risk Management: The DISCUS Safety and Risk Management Committee is made up of industry experts from DISCUS member companies and is responsible for evaluating and proactively engaging applicable regulatory agencies, insurance companies, and other standards. The committee keeps up to date with technological developments and legal proceedings to ensure an atmosphere of ongoing risk management throughout the industry.

The Children’s Food & Beverage Advertising Initiative (CFBAI)

Website: https://bbbprograms.org/programs/all-programs/cfbai

President/CEO: Eric D. Reicin

Ethical Leadership: Eric D. Reicin has served as Vice President, General Counsel, and Corporate Secretary for MorganFranklin Consulting LLC, a management consulting and government contracting firm. Since 2019 he has served as BBB National Programs’ President and CEO, where he leads the organization in fostering an environment of trust, innovation and competition.

Independent Oversight: The Children’s Food and Beverage Advertising Initiative is overseen by BBB National Programs, which also administers the Children’s Advertising Review Unit (CARU). BBB National Programs provides oversight ensuring that participants commit that advertising primarily to children under age 13 in the US will meet certain nutrition criteria.

Clear Standards and Guidelines:

  • Clear guidelines on what company-specific nutrition criteria may be advertised to children under 13.
  • Core Principles regarding requirements of food advertising to children for advertising and elementary school participants.

Scope and Focus of Accountability Mechanisms: CFBAI monitors the broad industry of child-directed food advertising expenditures in the US and most of the food advertising on children’s TV programming. CFBAI monitors and evaluates the participants’ compliance with their pledge commitments, and companies also submit annual self-assessments. Participants represent the majority of child-directed food advertising expenditures in the US and most of the food advertising on children’s TV programs.

Transparency:

  • All participants must comply with CFBAI’s Core Principles and must submit nutritional information regarding foods to be advertised to children. CFBAI’s website is regularly updated with a product list that reflects these foods.
  • The program requires participants to submit detailed self-assessments annually to easily and efficiently address non-compliance and disagreements between CFBAI and participants.
  • CFBAI regularly publishes annual reports discussing participants’ complaints and progress.
  • CFBAI accepts complaints on their website although these complaints are rare.

Education and Training: Periodic required training of employees across multiple divisions which might include nutrition, legal, marketing, policy and planning, product development, etc.

Continuous Improvement and Ongoing Risk Management: CFBAI regularly reviews the Uniform Nutrition Criteria to ensure it reflects the most current nutrition science and government guidance. The organization often references and directly communicates with the FDA to determine nutrition guidelines and compliance.

The Children’s Advertising Review Unit (CARU)

Executive Director: Eric D. Reicin

Ethical Leadership: Eric D. Reicin has served as Vice President, General Counsel, and Corporate Secretary for MorganFranklin Consulting LLC, a management consulting and government contracting firm. Since 2019 he has served as BBB National Programs’ President and CEO, where he leads the organization in fostering an environment of trust, innovation and competition.

Independent Oversight: The Children’s Advertising Review Unit is overseen by BBB National Programs, which also administers the Children’s Food & Beverage Advertising Initiative (CFBAI). BBB National Programs provides oversight ensuring that participants commit that advertising primarily to children under age 13 in the US will meet certain nutrition criteria. This self-regulatory body is voluntarily supported by brands such as Coca-Cola, Disney, McDonald’s, General Mills, Google, and others.

Clear Standards and Guidelines:

  • CARU Advertising Guidelines – monitors child-directed media to ensure compliance with these guidelines, seeking voluntary cooperation of companies and referral for enforcement action to authorities, such as the FTC or state attorneys general.
  • CARU Privacy Guidelines – address those concerns by providing guidance on specific issues involving online data collection and other privacy-related practices by operators of a website known to be collecting data on children under 13 years of age.

Scope and Focus of Accountability Mechanisms: Monitors all advertisers or websites that may deal with data collection from those aged 13 years or younger. The goal is for these companies to understand the implications of their advertising, as well as the effects and deceptiveness of advertising on children. Participants who have complaints filed against them are accountable to larger regulatory bodies.

Transparency:

  • Voluntary participants must comply with CARU’s core principles of the role of advertisers and data collection to not abuse the impact it has on children.
  • CARU makes the distinguishment between content and advertising is for children.
  • CARU releases an annual press release detailing best practices, compliance with laws, and responsibility for these advertisers that target children.

Education and Training:

  • CARU hosts various events annually encouraging those participating to come learn about updates and recent findings and best practices.
  • On their website, there are multiple resources available to CARU members such as archives and services provided.
  • CARU supporters also have access to CARU experts for questions, pre-screening and guidance from staff, and invitations to the annual supporters’ council meeting.

Continuous Improvement and Ongoing Risk Management:

  • CARU provides updates and news articles with recent developments in this spaces.
  • Pre-screening allows advertisers to have their practices checked out by CARU staff for best practices and compliance.

National Advertising Division (NAD)

Executive Director: Eric D. Reicin

Ethical Leadership: Eric D. Reicin has served as Vice President, General Counsel, and Corporate Secretary for MorganFranklin Consulting LLC, a management consulting and government contracting firm. Since 2019 he has served as BBB National Programs’ President and CEO, where he leads the organization in fostering an environment of trust, innovation and competition.

Independent Oversight: The National Advertising Division is overseen by BBB National Programs, which also administers the Children’s Food & Beverage Advertising Initiative (CFBAI) and Children’s Advertising Review Unit (CARU). BBB National Programs provides oversight ensuring that participants commit that advertising primarily to children under age 13 in the US will meet certain nutrition criteria. This self-regulatory body is voluntarily supported by brands such as Coca-Cola, Disney, McDonald’s, General Mills, Google, and others.

Clear Standards and Guidelines:

  • Clear policies and procedures are provided to understand the definitions, proceedings, and guidance relating to the NAD.
  • See 2024 Annual Report
  • If an advertiser wants to appeal their case, it will be reviewed by the National Advertising Review Board (NARB).

Scope and Focus of Accountability Mechanisms: The goal of the NAD is to help regulate advertising to be truthful and accurate for consumers with claims in national advertising. Its monitoring efforts are governed by its procedures and policies in place, and its resolution letters from disputes with the Federal Trade Commission (FTC) are listed publicly to ensure consumers are aware of such discrepancies.

Transparency:

  • All resolution letters from the FTC are listed publicly on their website.
  • It is known and made aware that the entire NAD is voluntary, and the annual reports list details of recent developments and case trends & statistics.

Education and Training:

  • There are annual meetings with the NAD with special speakers featuring companies and advertisers with personal testimony of changes in the industry.
  • There is an executive summary in the annual report, detailing stats of various cases and how often there are referrals in the industry about certain types of advertising.

Continuous Improvement and Ongoing Risk Management:

  • These highlights and annual reports provide for monitoring and updates regarding advertising for the NAD and changes to the industry.
  • If there are issues brought about from cases and the advertiser complies with recommended changes, the case is closed. If there are discrepancies noted, and the advertiser does not wish to make changes, then it is referred to the FTC or other regulatory bodies

Online Behavioral Advertising (OBA)

Website: https://www.iab.com/news/self-regulation-2/

Executive Director/Leadership:

  • Association of National Advertisers (ANA)
    Bob Liodice
  • American Association of Advertising Agencies (AAAA)
    Marla Kaplowitz
  • American Advertising Federation (AAF)
    Steve Pacheco
  • Direct Marketing Association (DMA)
    Lawrence M. Kimmel
  • Interactive Advertising Bureau (IAB)
    David Cohen

Independent Oversight: The United States Federal Trade Commission (FTC) closely monitors and provides independent oversight of behavioral targeting techniques used by online advertisers. They hold consistent workshops and publish periodic reports and articles on OBA.

Clear Standards and Guidelines: Cross-industry guidelines for applying consumer-friendly standards to online behavioral advertising across the internet.

Scope and Focus of Accountability Mechanisms:

  • The principles apply to numerous diverse entities that work to deliver relevant advertising intended to enrich the online consumer experience.
  • Online behavioral advertising (OBA) consists of “any collection of data online from a particular computer or device regarding web viewing behaviors over time and across non-affiliate websites for the purpose of using such data to predict user preferences or interests to deliver advertising to that device.”
  • Principles do not apply to websites’ collection of viewing behavior solely for its own uses.

Transparency: “The Transparency Principle requires the deployment of multiple mechanisms for clearly disclosing and informing consumers about data collection and use practices associated with online behavioral advertising. This Principle applies to entities collecting and using data for online behavioral advertising and to the websites from which such data is being collected and used by third parties. Compliance with this Principle will result in new links and disclosures on the web page or advertisement where online behavioral advertising occurs.”

Education and Training: “The Education Principle calls for entities to participate in efforts to educate consumers and businesses about online behavioral advertising. It is expected that there will be a robust industry-developed website(s) that provide consumers with educational material about online behavioral advertising. Additionally, it will result in numerous online impressions educating the public about how online behavioral advertising works and the choices that are available to consumers.”

It’s worth noting that there is no one particular education program entities require their employees to undergo, and these education efforts vary from company to company.

Continuous Improvement and Ongoing Risk Management: Programs systematically and/or randomly monitor the internet for compliance with the Principles. There is a process in place for taking and addressing complaints from the public, from competitors, and from government agencies concerning possible non-compliance. When an entity is informed regarding its non-compliance they are required to send public reports of corrections and uncorrected violations to appropriate legal entities.

Online Lenders Alliance (OLA)

President/CEO: Andrew Duke

Website: https://onlinelendersalliance.org/

Ethical Leadership: With 27 years in public policy, Andrew Duke brings extensive experience to OLA. He spent two decades on Capitol Hill, including as Chief of Staff for three members of Congress, notably Chairman Jeb Hensarling. He also led the Consumer Education Division at the CFPB. As OLA’s leader, Andrew oversees a diverse membership of job creators, lenders, fraud experts, privacy advocates, and more. He is dedicated to educating the public, media, and policymakers on the benefits of safe, regulated access to credit through online lending innovations.

Independent Oversight: The OLA is a self-regulatory trade association, so it is not directly supervised by a single government agency. Instead, it operates under its own governance and oversight, providing resources and setting standards for online lenders. However, the OLA works closely with various regulatory bodies that oversee aspects of online lending and financial services, including the Federal Trade Commission (FTC).

Clear Standards and Guidelines:

  • OLA’s federal policy team advocates for members and the industry by engaging with policymakers, sharing industry insights, submitting comments, and participating in meetings with key groups and coalitions to strengthen advocacy efforts.
  • OLA Policy Resources

Scope and Focus of Accountability Mechanisms: The OLA plays a crucial role in maintaining the integrity of the online lending industry by:

  • Developing and promoting best practices and standards for responsible online lending.
  • Advocating for fair, transparent, and responsible lending practices that protect consumers and businesses.
  • Collaborating with policymakers and regulators to ensure a balanced regulatory environment.
  • Educating stakeholders, including lawmakers and the public, on the benefits of safe, regulated access to credit through online lending platforms.

Transparency:

  • Provides detailed information on online lending practices, including loan performance, compliance with industry standards, and best practices, available to OLA members and stakeholders.
  • Shares relevant data and insights on regulatory updates, industry trends, and member activities through OLA’s website and newsletters to promote transparency and industry knowledge.

Education and Training:

  • OLA Training Programs: Periodic training sessions for industry professionals, offering both in-person and virtual courses on best practices, compliance, and key topics related to online lending.
  • Online Lending Essentials (OLE) Certification: A required certification for new employees in the online lending space, integrating foundational knowledge and industry standards to ensure responsible lending practices.
  • OLA Leadership Program: A rotational program for emerging leaders in the industry, providing hands-on experience and training in regulatory compliance, legal issues, and innovations in online lending.

Continuous Improvement and Ongoing Risk Management: OLA maintains a dedicated Risk Management Team to support members with real-time regulatory updates, compliance resources, and best practices to mitigate risks and enhance industry standards.