Unhealthy Commodity Industries & COVID-19: Alcohol Manufactures, Fast Foods and Beverages Makers Exploit COVID-19 For Commercial Gains

BEER companies adapting their logos to lung icons, burger companies geo-tracking customers with the lure of lockdown freebies, and soft drink giants donating thousands of cans to the homes of struggling communities in Mexico illustrate the multitude of ways in which unhealthy commodity industries have leveraged the COVID-19 pandemic for commercial gain, a new report has exposed today, launched during the 3rd Global Week for Action on NCDs.

Signalling Virtue, Promoting Harm: Unhealthy commodity industries and COVID-19, authored by the NCD Alliance and the SPECTRUM Consortium, is a preliminary exposé and analysis of tactics and strategies adopted by the unhealthy commodity industries during the COVID-19 pandemic. The report outlines four main strategies – pandemic-tailored marketing campaigns and stunts, corporate social responsibility programmes, shaping policy environments, and fostering partnerships with governments, international agencies and NGOs.

 The authors point out that such actions risk exacerbating the pandemic. “Since the early days of the pandemic, we have observed two trends: the growing epidemiological evidence that people living with NCDs are suffering worse outcomes from COVID-19, and that many producers of unhealthy commodities have rapidly adapted their strategies in an attempt to capitalise on the pandemic and lockdowns,” said Lucy Westerman, Policy and Campaigns Manager with the NCD Alliance and a co-author of the report . “It is a bitter irony that companies such as tobacco, alcohol and junk food, whose products increase the risk of NCDs, thereby putting people at higher risk of suffering through the pandemic, have positioned themselves as heroes and partners in the response and have interfered in public policies that seek to protect population health.”

Signalling Virtue, Promoting Harm was produced by crowdsourcing examples from advocacy and research specialists around the world to increase awareness and understanding of how companies have responded to COVID-19. To date, the initiative has received a total of 786 submissions from over 90 countries around the world with the most frequently cited countries being the United Kingdom and United States of America (each made 119 submissions), followed by Australia (56), India, (43), Mexico (34), Brazil (29) and Jamaica (28).

A large majority of the examples concerned activities of the alcohol industry and manufacturers of ultra-processed food and drink products (363 and 328 respectively), though the data set also includes notable submissions across breast milk substitutes, fossil fuel, gambling and tobacco. This preliminary report documents some 100 examples.

 

“COVID-19 has provided global health with an unprecedented prominence and is powerfully illuminating an important policy window, one that is far too significant to allow unhealthy commodity industries to define the agenda moving forward,” said Prof Jeff Collin, co-author of the report and an investigator with the SPECTRUM Consortium based at the University of Edinburgh. “Monitoring and countering their efforts to do so is therefore essential to developing coherent approaches to health and sustainable development that can help build back better for all.”

 

In examining the 100 examples of corporate activity around the pandemic and considering their strategic significance, the report highlights a number of key findings:

  • The striking consistency with which such corporate actions have been selected to advance longstanding strategic priorities. Multiple initiatives publicly presented as contributions to national or international efforts to combat the pandemic and support communities are designed to promote brands, products and corporations whose economic interests frequently conflict with public health goals.
  • The rapid adaptation of marketing and promotional activities to address a changing trade context and exploit lockdown demonstrates that a global crisis does not displace maximising shareholder revenue as the key driver of corporate behaviour.
  • The appropriation of health and social justice causes and frontline workers in ostensibly philanthropic initiatives vividly illustrates how corporate social responsibility programmes are shaped by promotional priorities and constitute a specific form of marketing.
  • The pandemic created new opportunities for companies to position themselves as partners in progress for health and sustainable development with governments, international organisations, health agencies and leading NGOs.
  • The volume and global reach of actions by alcohol and ultra-processed food industries demonstrate the need to advance international efforts to manage conflict of interest.
  • It is of vital importance to ensure that initiatives to address the pandemic are coherent with related health and development priorities, notably including effectively tackling NCDs. This imperative raises important questions for governments and for international organisations about their interactions with unhealthy commodity industries.

 

“The COVID-19 pandemic is ongoing around the world and this report should be seen as just the tip of the iceberg,” said Linda Bauld, Director of the SPECTRUM research consortium. “It is abundantly clear that unhealthy commodity industries will continue to adapt their engagement with COVID-19 as the pandemic, policy responses and economic crises evolve. Mapping this activity is vital if we are to shape a fine-tuned response to COVID-19 and at the same time avoid further exacerbating the pre-existing NCD epidemic.”

 

“There are lessons to be learned here for those leading the public health response to COVID-19 and planning for our future health security,” said Katie Dain, CEO of the NCD Alliance. “Signalling Virtue, Promoting Harm raises concerns about the prospect of a corporate capture of COVID-19. We see that companies are deploying these tactics pretty consistently worldwide, in order to ingratiate themselves with policymakers whilst barely concealing cynical attempts to weaken current rules and head off future policies. But the merciless impact of COVID-19 on people living with NCDs makes clear that policy change is more urgent than ever. To build back better from the pandemic, governments need to regulate these industries more strictly, to protect people against preventable NCDs and make our societies healthier and more resilient to future health threats.”

 

Adapting marketing and promotions, increasing availability

During the emergency phase of COVID-19 and with many countries introducing lockdowns to contain the virus, corporations were quick to adapt their marking strategies and promotions to leverage both the pandemic and associated policy responses. A striking theme across the examples is the frequency with which unhealthy commodity industries seek to link their products with the work of health professionals, emergency services and other frontline workers during the pandemic. Some examples:

 

Industry as COVID-19 Warriors

In their marketing and campaigns during COVID, unhealthy commodity industries have sought to present themselves as heroes. For example:

 

  • In India Lay’s Heartwork campaign was an emotional ode seeking to recognise the ‘real heroes’ atevery step of the journey from farm to finger’ … working ‘relentlessly against all odds to ensure Lay’s brings joy to millions’, and which also provided a cross-promotion opportunity for other consumable brands. Lay’s went on to engage influencers to praise and raise visibility of the Heartwork

 

Some of the industry responses sought to invoke patriotism as the route to keep people engaged with their products:

  • Frozen food manufacturer McCain sought to invoke a sense of civic duty in Canada, appealing to consumers to ‘Eat More French Fries Canada!’, linking a call for increased consumption with supporting farmers affected by the pandemic.

In the United States, the fast food chain Burger King produced several COVID-19 inspired adaptations to marketing and availability, including another example of invoking patriotic duty by encouraging US consumers to do their part and be “Couch pot-at-riots”, waiving delivery fees to encourage people to ‘stay home’, and donating ¼ million burgers to nurses via the American Nurses Federation.

 

Selling Social Distancing, Commodifying PPE

Unhealthy commodity industries have sought to leverage opportunities associated with the distinctive social and economic environments of the pandemic, including through developing product promotions that exploit a focus on social distancing, utilising face masks as advertising space, and inserting brand images into online video communication platforms:

  • In Brazil, brewer Karsten adapted their logo and slogan, adapting the style of their logo to resemble a pair of lungs – the main site of COVID-19 infection – and attaching the slogan “Good beer is like air: you can’t live without it” while encouraging consumers to follow 3 key tips to survive with Karsten – “isolate, use sanitiser and drink beer for fun”.
  • In Germany, a promotions stunt by Burger King to keep customers socially distant centred on large paper “social-distance crowns”, employing the chain’s signature logo in wide-brimmed hats to keep customers 6 feet away from each other as restaurants reopened.
  • A variation on this promotion was for the US beer Dos Equis, who designed and promoted a Seis Foot Cooler, a 6-Foot ‘Social Distancing Cooler’ give-away to ‘help you drink responsibly’.
  • Bacardi developed a Snapchat lens to encourage social distancing when bars re-opened and to reassure hospitality staff, patrons and policy makers that they are doing their bit to be part of the solution. Users of the app would be able to tell how far away other people were by being shown a Caribbean island when at a safe distance, but the screen turning red when within 1 metre of another person.
  • In Canada, one early exponent was a Subway franchise , offering 1 free facemask for 2 regular subs purchased and suggesting the deal was a great way to ‘protect you and your kids’.
  • In India, the beer brand Bira had already been producing branded facemasks used to protect from air pollution, which were re-marketed during the pandemic for a dual purpose, while Budweiser Streetwear Co launched a ‘fashion forward’ and ‘essential’ branded facemask design through the new apparel brand to appeal to Indian millennials.

 

Branding Zoom

The newfound daily prominence of online video meeting platforms like Zoom also created new virtual ‘billboard’ opportunities in the form of branded custom backgrounds:

  • Zoom has used McDonald’s in New Zealand and soda brands including Dr Pepper as wallpaper.
  • In India, Kingfisher beer was promoted via a set of “Good Times” wallpaper backgrounds for use in video calls within the “Divided by screens, united by Kingfisher” campaign. Scenes of ideal beer-consuming environments were included such as bars, couches and sporting events, with the logo and drinks of beer in the hands of smiling, jovial characters.

 

Accelerating digitalisation, increasing availability

The head of alcohol industry trade association Spirits Europe highlighted how the crisis has accelerated trends in digitalisation, boosting e-commerce and placing a new emphasis on virtual interaction.

  • AmBev sought to engage with the daily lives of Brazilian consumers by sponsoring a popular streaming concert series promoting brands such as Brahma Duplo Malte, Bohemia and Budweiser. The company later reported that this platform has “375 million views so far breaking all viewing records possible,  24 times more earned media impressions than [for the] FIFA World Cup in 2018.
  • KFC and Nintendo joined forces in the Philippines, to blend the popular game Animal Crossing, fast food, and social media. For those monitoring KFC’s global social media, they had the opportunity to find a time-limited invitation code facilitating access to a virtual KFC restaurant experience, with those players based in the Philippines eligible to receive real KFC give-aways upon finding the brand’s embedded mascot Colonel Sanders and his code.
  • In a move to gamify lockdown, Burger King offered a free whopper for those who ‘caught’ a QR-code moving around US TV screens.
  • In an attempt to “be present in Brazilian people’s daily lives” while “doing their bit” to support social distancing adherence, Burger King leveraged growing trends in digitalisation by asking users to agree to be monitored using a geolocation tool and receive a free “Lockdown Whopper” in exchange for staying indoors the longest.
  • Pepsico in the US launched 2 new direct-to-consumer websites for their pantry and snack brands for consumers to buy without having to go through retailers, with the ability for consumers to create so-called “snack packs.”
  • In the UK, the Get Wine App was quick to push promotions of rapid alcohol delivery within 30 minutes as lockdown restrictions came into force.

 

Corporate Social Responsibility (CSR) and Philanthropy

The mapping of CSR responses to COVID-19 highlights that unhealthy commodity industries have extensively used philanthropic and social responsibility initiatives as a corporate political strategy to build brand loyalty support in local communities and enhance reputation in wider society through addressing shortages and branded donations. In addition, CSR initiatives have performed a legitimating function in areas of reputational risk, such as single-use plastics and domestic violence.

 

Supporting communities to protect core interests

 

  • In Singapore, consumers have been nudged by Tiger Beer to make an SGD 10 contribution to local F&Bs in return for redeemable ‘digital drink vouchers’. The promotional website describes the brand as “standing in solidarity” and “rallying for help to support our local community” while “consumers stay off the streets as part of continued safe distancing measures”.
  • The ‘Apoie Um Restaurante’ campaign in Brazil is framed as creating a social movement “which will help more establishments to go through this difficult time” by offering a 50% discount subsidised by Ambev breweries and Nestlé.
  • In Ecuador, AB InBev have created Tienda Cerca – a WhatsApp-based online food delivery service for closed neighbourhood stores that also functions as an online store for an AB InBev While the platform is described in public-facing materials as supporting 70,000 small businesses, the website prompts participating stores to purchase direct from the Bavaria Brewer.
  • Promoted through the French Embassy in South Africa’s Twitter account, Pernod Ricard South Africa’s Keep The Spirit’ initiative offers a supplementary wage of R500 (R2 million in total) to “help alleviate the economic impact on members of the bar and restaurant community” for staff that sign-up to training materials about its premium brands.
  • In India, the AB InBev brand Budweiser has partnered with the media brand Mixmag to livestream DJ sets, donating INR 1.5 lakhs per view to a non-governmental COVID-19 relief organisation for at-risk nightlife workers.
  • In Mexico, FEMSA – the giant Coca-Cola bottling group and convenience store chain – and Nestlé, have pledged to donate packs of Nestlé breast-milk substitutes to vulnerable communities in Veracruz, with FEMSA also distributing unhealthy snacks and sugar-sweetened beverages to families living in deprived neighbourhoods of Monterrey.
  • A donation of 3,000 packs of sugar-sweetened beverages from Coca-Cola Ghana provided a marketing opportunity with the Deputy Minister of Information being interviewed on a national news channel in front of a Coca-Cola branded screen.

 

Addressing shortages and health systems strengthening

 

 

Corporate philanthropy and COVID-19 funds

 

Beyond CSR to address shortages in health systems, large philanthropic donations have been used to secure legitimacy and manage corporate reputations by some of the largest companies.

  • Japan Tobacco International made a USD $300,000 donation to health facilities and schools in the Kaoma and Nkeyema Districts of Zambia.
  • MARS donated USD $2 million to the World Food Programme, described by its CEO as “doing our part to prevent the spread of the virus and caring for our communities.”
  • AB InBev Urban Development Foundation donated RMB 1 million in cash to the Pingfang District government in China.

 

Moreover, the establishment of COVID-19 Emergency Funds in several countries in sub-Saharan Africa have provided unhealthy commodity industries with invaluable opportunities to secure legitimacy, project solidarity, and build relationships with policy makers:

  • Kenya – the emergency fund launched by President Kenyatta is chaired by the managing director of Kenya Breweries, Jane Karuku, while a donation of 6m by BAT Kenya puts the country’s largest cigarette manufacturer among the main contributors to the fund.
  • Uganda – a national address by President Museveni named two tobacco companies, Leaf Tobacco and Merchandise Ltd and Meridian Tobacco Company, among those listed as prominent contributors to national fundraising efforts, with a combined contribution of around Ugx. 250 000. Other contributors to Uganda’s national COVID-19 fund include Coca-Cola Beverages Africa. Their donation of Ugx.1.3billion and gift of three pick-up trucks to the Ministry of Health’s COVID-19 fleet received a public welcome from the Prime Minister, Ruhakana Rugunda, praising Coca-Cola as having been “a long-standing partner with us in many ways. Let’s continue the fight against COVID-19 together.”
  • Ghana-The COVID-19 Trust Fund established by the government received a high profile donation from the global online gambling company Betway. Ghana’s Trust Fund has also received a diverse range of product donations from across unhealthy commodity industries. Guinness Ghana Breweries, the local operating company of leading spirits producer Diageo, provided the Ministry of Information with 1,500 packs of its Malta Guinness. The Tolaram Group donated GHS1 million and a package of their products to the COVID-19 national Trust Fund, with their products being directed to vulnerable households during lockdown in support of the government’s food assistance programme. Total Petroleum Ghana made a presentation to the COVID-19 national Trust Fund comprising of 100 Total Cards, each with a value of 230 litres of fuel, worth a total sum of GH¢100,000.

 

Moreover, several companies have made a concerted effort to link responses to COVID-19 with existing corporate philanthropy in other areas. For example:

 

Pursuing Partnerships, Coveting Collaboration

Unhealthy commodity industries have also sought to advance strategic objectives through extensive collaborations. Nationally, these have included donations via partnerships with government ministries, hospitals and health agencies, as well as with key third sector service providers. Unhealthy commodity industries have also sought to link with leading international organisations and NGOs, and have widely depicted themselves as partners in global health and development. Such collaborations promise diverse benefits for industry, including association with the legitimacy and reputation of more trusted partners, enhanced access to elites, and the promotion of ineffective policies that don’t challenge commercial interests.

 

Partnering with Governments

 

Collaborating with Civil Society

  • In the United States, the American Red Cross was listed among recipients of a $500,000 donation from Altria, the parent company of Philip Morris USA and manufacturers of Marlboro. In Croatia, BAT describes “donating funds to the Red Cross to provide food parcels to communities in tobacco growing areas”. In Romania, Philip Morris is reported to have donated EUR 900,000 for medical equipment and PPE via the Red Cross.
  • In the Philippines, the Red Cross received a P15-million laboratory to boost its COVID-19 testing capacity from the Lucio Tan Group, whose companies include the tobacco company PMFTC tobacco company as well as Asia Brewery and Tanduay Distillers.
  • The Netherlands-based brewing giant Heineken announced a donation of €15 million to support the work of the International Federation of Red Cross and Red Crescent Societies (IFRC), particularly in Africa, Asia and Latin America.
  • In Thailand, PepsiCo partnered with the anti-poverty agency Raks Thai, a member of CARE International, to reach vulnerable communities across Thailand. The ‘Give for Hope’ partnership with Raks Thai was announced as a commitment of USD $550,000 (Bt 18 million) from PepsiCo Thailand, Suntory PepsiCo Beverages Thailand and the PepsiCo Foundation to support communities, farmers and health workers. Within this, the ‘Give Meals Give Hope’ project in Thailand was established with the objective of distributing over one million meals in 3 months.
  • The majority of PepsiCo’s reported distribution of USD $5 million via charitable organisations is allocated to food banks in Australia, Belgium, Egypt, France, the Netherlands, New Zealand, the UK; and in Latin America via the Global FoodBanking Network where it supports work across Argentina, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, Guatemala, Mexico, Panama, Peru and Uruguay.
  • The Global FoodBanking Network, along with Food Donation Connection and Feeding America also constitute key partners for McDonald’s increased food donations in the context of the rapid decline in customers across their fast food restaurants.

 

Global partnerships and collaborations with leading health and development agencies

  • The creation of the COVID-19 Solidarity Response Fund for WHO: While its due diligence processes prohibit funding from alcohol, arms, and tobacco industries, COVID-19 has provided opportunities for ultra-processed food and drink manufacturers to signal active engagement in the global response. Hence PepsiCo’s account of its funding towards a global response notes that “USD $2 million is going to the World Health Organization COVID-19 Solidarity Response Fund”. Mondelez International Foundation is also listed among the list of the Fund’s supporters, while the Starbucks Foundation committed USD $1 m
  • In both Central Asia and Latin America, the Coca-Cola Foundation has engaged with the UN Development Program (UNDP) in COVID-19 response initiatives presented as demonstrating the value of partnership approaches to promoting health and sustainable development. In Armenia, a UNDP webpage detailing a collaboration to supply emergency medical equipment states that the Coca-Cola Foundation and UNDP “provide global and local solutions to improve the situation”, with the UNDP Resident Representative describing collaboration with the private sector as “critical to prevent and better manage such crises.” In Tajikistan, UNDP were the recipients of a $50,000 donation from the Coca-Cola Foundation to purchase PPE, disinfectants and hand sanitizer. In Bolivia, the Coca-Cola Foundation donated $299,153 via UNDP to provide assistance to healthcare workers and vulnerable populations.

 

Shaping policy environments

 

COVID-19 has provided unhealthy commodity industries with scope to advance preferred policy positions, particularly as governments struggle to reconcile health objectives with economic and trade imperatives. Key activities have included lobbying to have unhealthy commodities designated as ‘essential’ products; petitioning to accelerate the easing of lockdown; working to undermine health and environmental regulations; and attempting to shape strategies for economic recovery.

 

Unhealthy commodities classed as ‘essential’

As governments implemented lockdown restrictions, producers of tobacco, alcohol and processed foods lobbied to have their products categorised as part of the essential supply chain. Governments in several countries included these products on official lists of ‘essential’ commodities so that their manufacture, distribution and sale would not be interrupted during national lockdowns:

 

Pressures on public health and environmental regulation.

There are multiple examples of health-damaging industries seeking exemptions or the weakening of regulatory restrictions on their activities during government lockdowns – particularly in high income countries, where regulatory controls are often viewed as being more restrictive. While relaxation or suspension of regulatory controls was usually called for as part of governments’ emergency responses to COVID-19, there have been growing demands from businesses for such measures to be maintained or even extended in order to boost economic recovery in the post-crisis period.

 

Pressure to accelerate emergence from lockdown

In countries where the activities of unhealthy commodity industries were restricted during lockdown periods, businesses were vocal in calling for such restrictions to be lifted as early as possible. Bans on alcohol sales were a particular target for such efforts:

 

 

Attempts to shape recovery strategies

While the weakening of regulatory controls is being widely presented as a response to the COVID-19 pandemic, there is evidence that unhealthy commodity industries regard the crisis as an opportunity to shape policies in the longer term. This is particularly evident in relation to the alcohol industry: beer producers in Europe and North America have actively lobbyied governments to introduce or extend tax relief in the medium term:

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