Top ad agency Havas London lost its B Corp status following an investigation that its sister agency’s work with Shell went against the values set by B Corp. B Lab, the company behind the B Corp certification, found the actions by Havas to be in breach of their community standards and revoked their B Corp status in light of the incident. The company cooperated on the matter but refused to take the necessary actions to stay certified.

The top-ranked advertising agency, Havas London, lost its B Corp certification after an investigation revealed that one of its sister agencies had worked with Shell, in obvious disregard for the values of the B Corp community.

B Lab is the organization behind B Corp certifications. It started reviewing Havas and its sister agencies in January. That was a response to an agreement Havas made in the previous year to run ads for Shell, one of the biggest fossil fuel companies.

The deal infuriated many in the B Corp community. Last month, 27 PR and creative agencies lodged a formal complaint to B Lab. They say working with a company like Shell does not jibe with B Corp values.

The B Lab ruled that the holding company of the agencies, Havas, had violated these very same principles following an exhaustive investigation. While the agencies carrying the B Corp certification were not directly implicated in the deal with Shell, B Lab ruled that the entirety of Havas was liable.

B Lab offered to suspend Havas’s B Corp status, providing the opportunity to fix the problem. However, Havas refused to agree to precisely do what B Lab wanted. Their B Corp certifications were revoked as a consequence of this move.

According to B Lab, the body behind the certification, “The investigation has determined that the actions of Havas run counter to the values of the B Corp community. While none of the agencies holding certifications worked with Shell directly, Havas’ structure and brand name mean the entire group needs to meet the requirements in order to maintain the certification.”

The statement further read, “Havas cooperated during the investigation and accepts the ruling but they decided not to do the remediation actions to retain the certification.”

The Havas London, Havas Lemz, Havas New York, and Havas Immerse are no longer certified B Corps. Also, other arms of the Havas group cannot be B Corp certified.

This decision came even after Havas’ chairman and CEO, Yannick Bolloré, stated last October that he was not worried about any action from B Lab. He told an advertising magazine, “So long as we’re making things better, B Corp will let us keep working with controversial industries.”.

This has truly woken a hornets’ nest around PR and advertising in general. On one side of the coin, some believe that energy companies must have all the rights to express their efforts of moving away from fossil fuels. Others feel any work with such companies always comes down to greenwashing—an act where a company is made to seem greener than they really are.

Earlier this week, Chris Norman, founder and CEO of London creative firm Good Agency, had called for Havas to be stripped of its B Corp status. “There should never have been any doubt that an agency helping a fossil fuel company should keep its B Corp accreditation,” he wrote.

He also said that though the delay of the decision hurt the reputation of B Lab, it is good that now there is a clear rule. That will hopefully now be standard practice for all agencies working with B Corps.

The Havas and Shell controversy has set a very significant precedent. This goes on to prove that even large companies have to bend towards maintaining and upholding B Corp values, lest they suffer the loss of certification. This consequence again tightens the necessity for adhering to what B Corp stands for, even when it is painful.