World's biggest 25 food companies not taking health seriously enough

The world’s top 25 food companies appear not to be taking the new global diet and health agenda seriously enough, says an 80-page report from The City University.

The world’s top 25 food companies appear not to be taking the new global diet and health agenda seriously enough, says an 80 page report from The City University out today.

Researchers at City’s Centre for Food Policy studied the annual reports, accounts and HQ websites (to Autumn 2005) of the top 10 food manufacturers, top 10 food retailers and top 5 foodservice companies (top 3 fast food and top 2 contract caterers).They were rated for whether the companies were doing anything about the health agenda agreed by the world’s governments at the World Health Organisation.

In May 2004, a Global Strategy on Diet, Physical Activity and Health was passed by the World Health Assembly (the WHO’s governing body). This made recommendations to companies as to what they could do to health tackle the world’s diet crisis – not just obesity but heart disease, cancers and diabetes.

The City researchers – Prof Tim Lang, Dr Geof Rayner and Elizabeth Kaelin - took the WHO recommendations and looked to see what the world’s biggest food companies in three key sectors – processing, retailing and catering – were doing to address that health agenda. They reviewed company policies, actions and commitments on a wide range of health-related issues, including: R&D spending, marketing, advertising & sponsorship, whether health was part of corporate social responsibility, policy on diet & physical activity, the healthiness of products, obesity and children, labelling, stakeholder engagement and whether companies gave health help to their own employees.

“The research is the first attempt to monitor whether and how these powerful companies are reporting on their impact on diet and health. We set out to shine a light on what these mostly publicly quoted companies are doing, or report they are doing. Our findings are worrying. There is a pretty poor overall picture, with too many companies appearing not to care a jot,” conclude the City team. “The smallest company we investigated had a turnover five times that of the WHO’s entire annual budget, so they cannot use lack of resources as an excuse.”

Retailers, who often present themselves as the consumer’s friend, in fact came out worst performing sector. Food manufacturers who have been under attack for selling fatty, salty sugary foods in fact reported most activity. The same was true for foodservice where fast food companies have been in the health firing line.

“This suggests that the best way to get companies to take health seriously is to have critics outside giving them a hard time. The critics are unpaid watchdogs. Eventually the companies wake up. But if companies keep their heads below the parapet, no health innovation or consciousness seems to take root inside corporate culture. The danger is that health criticism is focussed only on certain high profile companies, and not across entire sectors, which is what is needed” said Tim Lang, Professor of Food Policy at City.

The report is today launched free on the City University website. “We want to encourage investors, consumers, NGOs, public health departments and governments to start health auditing companies based in their countries.” The City team was advised by two financial analysts on the project.

“The findings of this report suggest that the world’s food companies are not yet fully engaged with the seriousness and urgency of the demands to tackle diet-related ill-health worldwide. There are some honourable exceptions, which are highlighted in each section of this report.

“Companies should be wary about doing the minimum or presenting a few hurried initiatives in self-promotional terms. A luke-warm response from food companies to the enormity of the public health evidence amassed by the WHO and researchers risks engendering some cynicism. Company actions must move from being purely defensive or centred on obviating threats to their reputations.”

Key facts from over 60 pages of findings include:

Only 10 out 25 companies reported that they were acting on salt: Cadbury Schweppes, ConAgra, Kraft, Nestlé, PepsiCo, Unilever, Ahold, Carrefour, Tesco and Compass.
Only five reported action on sugar. Four were manufacturers: ConAgra, Kraft, PepsiCo, Unilever, plus only one retailer: Ahold.
Only four reported action on fat. These were Kraft, PepsiCo, Compass and Yum!.
Eight reported action on transfats: Cadbury Schweppes, ConAgra, Danone, Kraft, Nestlé, PepsiCo, Unilever and Ahold.
Only two reported action on portion size: Kraft and McDonald’s.
Food manufacturers (six out of ten) tended to be more pro-active on salt and on sugar (four out of ten) than other sectors.
Kraft acted on all five, the only company to do so. PepsiCo acted on four (not on portion size).
Retailers performed particularly poorly but Ahold was acting on three issues (salt, sugar and transfats).
Among foodservice, performance was generally weak but Compass led with actions on salt and total fat.
McDonald’s which has been high profile in the diet and health debate reported no commitments other than on portion size.
Thirteen companies gave no information on their spending on marketing, advertising, promotion and sponsorship.
Only 11 of the 25 companies make a reference to health in CSR / values statements: Danone, Kraft, PepsiCo, Unilever, Ahold, Carrefour, Kroger, Tesco, Compass, McDonald’s, Yum!.
Eight out of 10 manufacturers, four out of 10 retailers, and all five foodservice made statements about health but only six companies had a Board member responsible for health.
Food manufacturers are more engaged with the physical activity issues (seven out of 10) than any other sector.
Six out of 10 manufacturers (ConAgra, Danone, Kraft, Nestlé, PepsiCo and Unilever), only one retailer (Tesco) and four foodservice (McDonalds, Burger King, Sodexho, Compass) had a policy commitment to healthier food ranges.
Only four out of 25 companies had any policies on advertising, all of them manufacturers: Cadbury Schweppes, Danone, Nestlé and Unilever.
Only six companies had policies specifically on children (despite the existence of ready-made Children’s guidelines produced by US-based CARU).
Only 10 out 25 companies reported that they were acting on salt: Cadbury Schweppes, ConAgra, Kraft, Nestlé, PepsiCo, Unilever, Ahold, Carrefour, Tesco and Compass.
11 of 25 companies reported positions on on-product labelling: Cadbury Schweppes, Coca-Cola, Kraft, Nestlé, PepsiCo, Unilever, Ahold, Carrefour, Ito-Yokado, Metro and Tesco.
No foodservice company reported a policy on on-product labelling although one is reported externally as being about to do so.
Only 10 out of 25 companies reported that they have staff health programmes. The five manufacturers were Cadbury Schweppes, Coca-Cola, ConAgra, Kraft and Nestlé. The two retailers were Metro and Rewe. The three foodservice companies were Compass and McDonald’s and Sodexho.

For further enquiries please contact Helena Clay, 020 7040 8788 helena.clay.1@city.ac.uk, or Louise Scodie, 0207040 8783 louise.scodie.1@city.ac.uk, in the City University Press Office.

Notes to editors

Prof Tim Lang, Dr Geof Rayner and Elizabeth Kaelin are available for interview, via the City Press Office.
Tim Lang is Professor of Food Policy
Geof Rayner is Visiting Research Fellow
Elizabeth Kaelin is Research Assistant on this project
The Report ‘The Food Industry, Diet, Physical Activity and Health: a Review of Reported Commitments and Practice of 25 of the world’s Largest Food Companies’ published by the Centre for Food Policy, City University is available on the website.

Date of Article: 04/04/2006