The influencer industry needs proper regulation to build trust and credibility

Research fellow for The Australia Institute – Centre for Responsible Technology, Jordan Guiao, takes an unfiltered look at social media scandal.

For every influencer on social media trying to do the right thing being transparent about paid promotions, staying on brand and posting high-quality content – there’s another who’s making themselves look bad, mostly by airing dumb views and sharing misinformation.

Misinformation is a huge issue online, and throughout the pandemic we’ve seen an escalation in ill-informed views around anti-vax sentiment, anti-lockdown protests and conspiracy theories around COVID.

A smattering of social media influencers have outed themselves as conspiracy theorists who undermine public health advice, including ‘TikTok guy’ Jon-Bernard Fairouz, and Byron Bay ‘artist’ Sally Mustang.


Personalities like these do not represent the entire industry, but their activities can damage the reputation of those who are credible, professional and use their profiles appropriately.

The fundamental issue with the social media influencer industry is that it suffers from a lack of basic oversight and frameworks which define the benchmarks for best practice and standard behaviour.

To date only two self-regulating codes govern the influencer industry – the Australian Association of National Advertisers (AANA) Code of Ethics with an associated complaints mechanism through the Ad Standards Group, and a voluntary industry code proactively developed through the Australian Influencer Marketing Council (AiMCO) which was born due to its member agencies having no reference for best practices to turn to, hence the need to develop one themselves.

The two codes are limited, although the Ad Standards mechanism has generated activity recently, with McDonalds and KFC being caught out. However the Ad Standards breaches only relate to inadequate disclosures of commercial affiliation, and not to do with accuracy and quality of content, and the AiMCO Code relying on goodwill and active participation.

Foolish influencers who peddle misinformation is of particular concern when it comes to sensitive categories like health and medical, and financial advice.

In the physical world, these industries are appropriately regulated and demand specific qualifications and licenses given the potential for significant risks and dangerous impacts of the wrong advice.

In social media, influencers with no qualifications in health regularly provide questionable advice under the guise of ‘wellness’ and ‘lifestyle’, and those with no Australian Securities and Investment Commission (ASIC) approved license regularly provide financial advice. This glaring oversight is an issue that needs to be addressed.

Further, only those with the largest profiles or “mega-influencers” with over a million followers receive attention and coverage for any breaches, and the middle layer of influencers with followers in the tens of thousands or even hundreds of thousands are left alone and suffer no material consequences for any wrongdoing.

The shadow of misinformation will continue to be cast over the entire industry unless appropriate action is taken.

The significant regulatory disparity between influencer advertising and mainstream advertising, particularly in sensitive categories like health and finance means that using influencers will continue to be delegitimised by a handful of bad actors.

If marketers want the industry to grow and be taken seriously, then the appropriate checks and balances must be put in place.

After all, it takes a lifetime to grow a brand, and only one scandal to destroy it.

Jordan Guiao is a research fellow for The Australia Institute – Centre for Responsible Technology.


Get the latest media and marketing industry news (and views) direct to your inbox.

Sign up to the free Mumbrella newsletter now.



Sign up to our free daily update to get the latest in media and marketing.