Regulation over Reputation? The UK's Approach to Influencer Marketing Laws

The Influencer as a Separate Entity

Although 73% of UK brands believe it’s crucial for influencer campaigns to reflect positively on their brands, many don’t require influencers to strictly adhere to their corporate ethics or values.

This lax approach may be because UK companies choose more casual campaign types, such as gifting and affiliate marketing, than other European brands. The Kolsquare report found that 46% of UK brands leverage gifting, while 53% use affiliate campaigns.

These models give influencers creative freedom and tend to be more hands-off than fixed-fee campaigns. While this approach to working with influencers often results in authentic content, it can make it difficult for brands to enforce adherence to corporate ethics. This could be the cause of the UK's more flexible approach to value alignment.

Influencer Ad Regulations: What are the legal issues around advertising with influencers?

Regulations vary across Europe. The EU has increasingly taken harsher stances on IM and social media due to concerns about lowering attention spans and their effect on children. In 2024, the EU rejected TikTok’s new offering, TikTok Lite, after a “diligent assessment of the risks it entails.” The EU committee decided that TikTok did not have “effective risk mitigating measures” for their new, highly addictive app.

TikTok has halted the European release of its new app before it reached the UK. But let's dive into the current UK regulations and legislation.

What are the laws around influencer collaborations in the UK?

The two main regulatory bodies in the UK are the Advertising Standards Authority (ASA) and the Competition and Markets Authority (CMA). Influencer marketing in the UK falls also falls under the Consumer Protection from Unfair Trading Regulations 2008 and the UK Code of Non-broadcast Advertising and Direct & Promotional Marketing (CAP).

These bodies enforce the following rules:

• Influencers must clearly disclose any partnerships with tags like “#ad,” "gifted," or “paid partnership.” These tags should be clearly visible and not hidden behind a “read more.”
• Influencers and brands maintain transparency, fairness, and truthfulness in all promotional content.
• There are also additional laws for industries like gambling.
• Social media platforms are expected to provide tools for labelling commercial content and reporting hidden advertising.
• Ads directed at children must avoid causing harm to children, should not make them feel inferior for lacking a product, and should be created with a sense of social responsibility.

The UK government plans to give the CMA more power to independently determine breaches and issue fines. However, at the moment, the only punishment for failure to comply is “naming and shaming.”

Do influencers have to disclose ads in the UK?

Yes, influencers in the UK must disclose ads by clearly labelling posts as #ad, #sponsored, or similar terms when they receive payment, free products, or any other form of compensation.

If you're working with influencers abroad, you must also comply with the legislation in their country.

Marketing Rules: The UK ASA Guidelines vs EU Influencer Marketing Laws

The UK regulations aren't just for show, they are actively enforced. For example, Love Island contestant Francesca Allen was "named and shamed” for repeatedly failing to disclose ad content.

Some argue that these "shaming" tactics aren't sufficiently effective, but there are still no fines in the UK for disobeying parties. However, the ASA believes that the negative publicity generated by a complaint may produce enough bad press in the short term to promote compliance. The brand's failure to adhere to regulations may also be the first thing shoppers see on search results.

Across Europe, legislation varies and can be tougher. For example, in France, failure to tag promotional posts can lead to fines and penalties of up to €300,000.

The European Commission is also moving towards creating a more uniform regulatory framework across EU countries. With rising concerns over misleading practices and the impact of influencers on vulnerable audiences, EU regulatory bodies hope to protect consumers even more.

Despite the softer approach of UK regulators, our report shows that UK businesses still endeavour to follow regulations. Yet, they are less invested in social issues than their European counterparts.

Why do UK brands overlook social issues in influencer partnerships?

UK brands care less about bullying, discrimination, the use of minors for promotions, and sustainability than their EU counterparts. So, why are ethics such a non-issue in the UK?

It’s difficult to say exactly. While choosing more casual campaigns may explain the indifference towards influencers sticking to cooperate ethics, there are likely other cultural and political issues at play.

Let's consider a few of the possibilities.

Post-Brexit Malaise

Four years on from the official exit, fractured relationships with the EU, longer queues, and immigration frequently pop up in the news.

Another result of Brexit is that the UK now has a more relaxed regulatory environment, which has led to divergence from stricter EU guidelines on corporate ethics and responsible business practices.

EU countries are subject to stricter regulations like the Sustainable Finance Disclosure Regulation and Corporate Sustainability Reporting Directive, which push companies to prioritise social and environmental issues.

During Liz Truss's tenure, the UK Government introduced the Retained EU Law (Revocation and Reform) Bill, aimed at ensuring that most EU laws retained post-Brexit will expire by the end of 2023. However, 69% of businesses are against lowering UK standards.

Interest but Struggling to Act

Reuters found that 62% of UK brands care about ESG. At the same time, a study by the Boston Consulting Group found that 76% of UK consumers are actively trying to make more sustainable and ethical purchasing decisions, and they expect brands to do the same.

Additionally, 57% of consumers say their perception of a brand is directly influenced by its sustainability practices, while 30% are compelled to take action—either by switching brands or advocating for or against them—based on how a brand addresses social and environmental issues.

However, despite this strong interest in ethical behaviour, only 8% of UK consumers are willing to pay a 12% premium for sustainable products. The British public's lack of investment in sustainability may explain why some UK brands are less proactive about social issues.

But it's no surprise consumers are unwilling to shoulder the costs of ethical consumerism. UK consumers saw the cost of living rise by 53% more than the European average, which has likely led to more conservative, practical spending habits.

High inflation has also put pressure on businesses across the UK. All of these may be impacting the UK population and businesses' approach to ethics.

The Effect of British Business Culture

Cultural differences also play a role in how businesses view their responsibility to society. European markets, especially Scandinavians and other Northern Europeans, have a long-standing tradition of integrating social and environmental considerations into business practices. UK businesses tend to have more traditional profit-driven mindsets.

Finding the balance between regulatory compliance and ethical considerations

Brands may be taking a risk by not prioritising ethics. Globally, there is a growing push towards ethical consumerism, including "Underconsumption Core", which promotes second-hand shopping and reduced purchasing.

When a brand is perceived as unethical or collaborates with "unethical" influencers, it's reputation may be harmed. A prime case study is Molly-Mae Hague's partnership with PrettyLittleThing (PLT). Hague faced backlash after making comments perceived as tone-deaf regarding poverty and hard work, which reflected poorly on PLT. This incident was particularly damaging as it came alongside criticism that PLT was paying its factory workers below minimum wage, sparking further negative attention. Perhaps due to these challenges and the competitive market of fast fashion, PLT's profits have been falling.

In such cases, ethical missteps can lead to long-term harm, as a tarnished brand image reduces customer loyalty, negatively impacts sales, and potentially limits the brand’s ability to attract and retain employees.

Strategies for UK companies to enhance their ethics while adhering to standards

So brands need to set a high standard and follow regulations while maintaining ethical values.

Here are some ways brands can enhance the ethics of their IM strategy:

• ESG and Transparent Reporting: UK companies can strengthen their ethical approach by adopting comprehensive ESG strategies. This includes setting transparent targets and reports for sustainability, social impact, and governance. According to a 2023 survey by PwC, 79% of UK CEOs acknowledged the importance of ESG initiatives in maintaining long-term profitability and reputational health.
• Communicate Clear Ethical Policies: Establish clear ethical policies throughout the business. A report by the Chartered Institute of Marketing highlighted that 42% of UK marketers saw clear, consistent communication of ethical values as a critical factor in consumer trust.
• Engage in Stakeholder Collaboration and Social Dialogue: Companies can build trust and credibility by engaging with stakeholders—customers, employees, suppliers, and the community—on social and ethical issues. And consider asking your employees to share your brand's culture as employee advocates. But Eidleman also found that 78% of UK consumers want the CEO to speak out about ethical issues.
• Leverage Influencer Marketing Platforms: Use digital tools and technology platforms like Kolsquare to monitor influencer compliance and credibility. You can also use the platform to quickly discover which brands influencers have worked with, the hashtags they use, and more! Book in for a demo today.
• Foster Long-Term, Ethical Partnerships: Affiliate links and gifting are great starter campaigns. However, long-term influencer partnerships build deeper trust, credibility, and authentic brand alignment. They allow influencers to naturally integrate the brand into their content, enhancing loyalty among their followers. These sustained relationships also support ethical working conditions, providing more stability for influencers and a stronger commitment to brand campaigns.
• Implement Social Listening: Use social listening tools like Kolsquare to monitor public sentiment around social and ethical issues relevant to your brand. Discover how your brand is perceived and how competitors are utilising IM.

These help you run better campaigns and can increase your return on investment over time.

The Future of Holistic Influencer Advertising on Social Media

UK brands might lean towards complying with regulations, but building an ethical foundation in influencer marketing is just as important. While some companies may deprioritise ethics during economic challenges—especially as consumers continue to buy despite ethical concerns—a strong ethical approach has the potential to foster long-term growth and loyalty. By focusing on both compliance and values, brands can achieve a balance that resonates with evolving consumer expectations.  

Download the Kolsquare State of Influencer Marketing Report free now!

Summary

What are the rules for influencers?

Influencers in the UK must clearly disclose ads using labels like #ad or #sponsored in compliance with ASA and CMA guidelines. Failing to follow their rules and correctly label sponsored posts may lead to fines and reputational damage for both content creators and brands.

What is the influencer marketing clause?

An influencer marketing clause refers to specific terms in a contract between a brand and an influencer, outlining content expectations, sponsorship disclosures, timelines, payment details, and exclusivity. It ensures both parties meet regulatory standards and have clear obligations.

Are there influencer marketing law firms?

Yes, there are law firms in the UK that specialise in influencer marketing cases. Many firms offer expertise in navigating advertising laws, drafting contracts, and ensuring compliance for brands and influencers. It can help brands define intellectual property and guide them through consumer protection laws and policies.

What is contract law for influencers in the UK?

Influencer marketing contracts set out the terms for content creation, payment, disclosure requirements, usage rights, and timelines. Though not essential for influencer marketing, they are beneficial. The basic elements of contracts are an offer, consideration, acceptance, and mutuality. These laws fall under UK contract law, similar to a freelance working agreement,