Senior Vice President; Member, Vitality Group; PepsiCo Scientific Advisory Board
Director, Rudd Center for Food Policy & Obesity, Yale University
Senior Fellow for Global Health, Economics, and Development, Council on Foreign Relations
THOMAS BOLLYKY: Good afternoon, I am Tom Bollyky, Senior Fellow for Global Health, Economics and Development. This event is entitled, "Is There a Seat at the Table for the Food and Beverage Industry in the Global Fight Against Obesity?"
As many of you probably know, obesity has become a worldwide epidemic at this point, affecting wealthy and poor countries alike. World Health Organization (WHO) estimates that obesity has doubled over the last three decades. United States is an early adopter, of course, of the obesity epidemic, but its epidemic is no longer the fastest-growing. Changes in global food production and diet are driving obesity in low- and middle-income countries as well. WHO estimates that obesity is now the fifth-largest cause of death worldwide, causing 2.8 million deaths per year.
The role of the food and beverage industry in that epidemic is a subject of much debate. For its partisans, the food and beverage industry has necessary expertise and is a willing and capable partner in the fight against global obesity. For its opponents, the food and beverage industry is hopelessly conflicted on this issue and has quietly undermined, both domestically and internationally, efforts against obesity.
Just this past week, Margaret Chan, Director-General of the WHO, felt obliged to release a statement disavowing press reports that the WHO had accepted money from the food and beverage industry but confirming that the Pan American Health Organization had accepted money. The Pan American Health Organization, for historical reasons, has a certain amount of independence from the WHO, and they had accepted a few hundred thousand dollars from Coca-Cola, Nestle and Unilever to support chronic disease programs.
I'm very pleased today that we have two truly excellent speakers representing both sides of this debate. I believe strongly they're both the best representatives of those two sides of the debate, so I'm thrilled that they agreed to be here and participate in this event.
And to run through their backgrounds briefly – you have their bios before you; I'm sure many of you know them. Kelly Brownell is the James Rowland Angell Professor of Psychology at Yale University. He also serves as the professor of epidemiology and public health and the director of the Rudd Center for Food Policy & Obesity. As you'll see from his bio, he's a recipient of many rewards, an author of more than a dozen books –
KELLY BROWNELL: Not rewards.
MR. BOLLYKY: I'm sorry, awards. (Laughter.)
MR. BROWNELL: I wish.
MR. BOLLYKY: Awards. (Laughter.) Author of over 350 scholarly articles; Time magazine listed Kelly as one of "The World's 100 Most Influential People" and cited him as a "moral entrepreneur."
Derek is an equally accomplished expert in public health. He is the Senior Vice president of the Vitality Group. Until recently, he was the Senior Vice President of Global Health and Agricultural Policy at PepsiCo. He remains on Pepsi's Scientific Board. Previously he headed global health at Rockefeller Foundation and was a former Executive Director of Noncommunicable Diseases and Mental Health at the WHO.
Some of you may not know they're former colleagues at Yale. I believe they actually have co-authored one paper together at some point. But they have promised – (laughter) – promised to put that shared history aside and relentlessly go after the jugular in a furious battle for your hearts and minds here today, which leads me to the rules of this debate. It is going to be a formal debate. This is very unusual for the Council. But if there were a subject in global health that needed a formal debate, this is it.
The way this will go is we will debate two propositions here today. I will read the first proposition, take an informal vote from you, the audience, to get a sense of the temperature in the room on these topics. Each speaker will have four minutes to make his arguments and two minutes to make a rebuttal. We will then repeat the same pattern for the second proposition. Kelly will go first for the first proposition. Derek will go first for the second. We will reserve 20 minutes at the end for questions and answers from the audience.
Now for the Council's disclaimer: If you have a cellular phone, please turn it off. I don't know if it affects the sound system or not; it's just very rude. (Laughter.) This meeting is on the record. Participants are welcome to use and cite the information received here today and attribute the information to whoever speaks at the meeting. Members of the press are present at this meeting and may be recording this event for their purposes.
All right. With that, I will turn to the first proposition, which I will read and then take a vote from the room. The first proposition is: There is a fundamental and irreconcilable conflict between the food and beverage industry's interest and public health policy interests on obesity.
Now, just an informal sense of the room. If you favor this proposition, please raise your hand. All right. And with that, I will turn it over to Kelly for his first four minutes of remarks.
MR. BROWNELL: Thank you, Tom, and thank you for inviting me to this event and for having it in the first place. It's very nice that this group is taking up the issue, which I think is terribly important.
I'll begin with the premise that there are three major world food problems, each a potential catastrophe in its own right. One is obesity and overnutrition, one is hunger and undernutrition – those affect about the same number of people worldwide – and the third is the impact of modern food production on sustainability, climate change and issues of the environment.
I propose to you that the food industry can play a productive role and has, in some cases, in two of those but not in the third. Certainly there have been issues regarding food fortification where the industry has been helpful. There are industry advances in helping address the hunger issues worldwide, although there are some complexities there. But could I convince you that obesity is a different kettle of fish, that obesity is different in fundamental ways from the other two and industry has not played a constructive role and shows very little sign of doing so?
The bare-bones fact is that industry has to sell more food. If it's going to make quarterly profits, it has to sell more food. The only way that that assumption could be different is if the industry can sell less but better food and people are willing to pay an extraordinary amount for it. There is a niche of people who do that, but the vast majority of people in the population do not, and there's no sense that worldwide this is likely to be much of a sizeable group.
If the industry is in pursuit of selling more food, what must they do? Well, they can sell more food if the world population grows, and that is happening. But they can also encourage the existing people in the population to eat more food, and the industry has become remarkably clever at that. Marketing is overwhelming, especially the marketing of unhealthy foods to children, which raises very interesting ethical and perhaps even legal issues. The marketing of unhealthy food in the developing world is appalling, in my mind, and I think the greatest shame of all that the food industry has to face is the food colonization of the developing countries.
If you look at the changing food norms in the United States, how have they changed in years? Now, some of us in this room are old enough to remember a time when a Coke or a Pepsi came in an 8-ounce bottle, a 6 ½-ounce bottle before that. The default serving size is now 20 ounces. People tend to consume whatever is in a bag or a bottle, a box. The fact that the 20-ounce big serving is now the default has, by definition, increased consumption of sugared beverages, a victory for the industry but not for public health.
Let's look at how other food norms have changed. Not only portion sizes have changed, but let's look at time of day. I remember 20, 25 years ago, maybe, one of the fast food companies introduced fast food for breakfast. I forget which company it was, but people thought they were crazy, they would go out of business, because what Americans would eat fast food for breakfast? And look how that norm has changed. You may have seen the very deliberate attempt by the fast food companies now to establish the eating of fast food between midnight and breakfast time to be a legitimate event. Taco Bell calls this the "fourth meal."
Where we eat has become different. When I was a child, people did not eat in their automobiles. They typically didn't eat standing up or at their desk. The time of day, the portion sizes, where we eat, how we eat has all been specifically and very deliberately recalibrated in the United States. And people in developing countries should see this as coming to a theater near you.
So when the industry is in the pursuit of selling more food, which by definition they have to do, how do you do that? Well, you change norms, but you also engineer foods to taste particularly good, so you increase levels of sugar, fat and salt to make them as highly palatable as possible. These constituents of the food supply, particularly sugar, with new evidence would suggest can act on the brain much like traditional substances of abuse, raising questions about whether these foods are engineered deliberately, if not inadvertently, to hijack the brain and create this need that people have to consume these products in excess amounts. The industry has every motivation in the world to sell as much of these type of foods as possible.
Just so happened there was a Duane Reade right next to the hotel I was staying in, and I went and looked to see how much Coke and Pepsi cost compared to bottled water, and you could buy a 2-liter bottle in that Duane Reade today of Coke or Pepsi – they were about the same price – for about $2.19. The 1-liter bottle of water was the same, $2.19. Well, the sugared beverages begin as water, and then you have to do something to them to create sugared beverages; presumably they should cost more. Why would they price them so attractively? People do not overconsume water; they do overconsume the sugared beverages. Hence, the industry has the motivations that are consistent with its business aims but inconsistent with public health. And therefore, I think, the goals are irreconcilably in conflict, at least for now.
MR. BOLLYKY: Great. Derek?
DEREK YACH: Thanks, and also thanks to the Council for hosting this and all hosting in this room where we can be inspired with David Rockefeller looking down at us, who epitomizes what needs to be done in terms of private-public partnerships and has for seven decades.
I'm obviously thrilled to see so many people coming from diverse sectors: the food and beverage industry, NGOs, corporates, governments, academic friends. Welcome to this table. And I have no doubt that if we actually spent more time together, we'd be able to make some progress.
I'm going to include under the category of the food and beverage industry the manufacturers, retailers, restaurants and food service providers. And I suspect that there are many here who would focus on the contribution that the industry makes to provide a wide range of snacks and treats of low to no nutritional value. Kelly addressed that. That is important to address, but it does miss a bigger point that he separated.
Through the totality of its efforts over the last decades, the food industry has provided a sustainable source of nutritious and affordable foods and beverages to people. The successful physical and intellectual development of people around the world has relied upon that progress for almost a century. The food and beverage has been key to ending famine in all but a few countries, establishing safe and secure food supplies, and as the 1993 Nobel Prize winner Robert Fogel so well documented, laid the basis for intergenerational improvements in health and economic development in Europe and worldwide.
This broader context and the continued need for some actions cannot be fully – must be fully understood as we build responses in ways to address obesity as we try and approach food security. I think we've started seeing some edging towards obesity solutions, which I'll refer to.
I believe support for proposition one is misplaced. The view is supported – that view is supported by many governments. It assumes – the proposition assumes that the problems related to obesity can be isolated from a wider set of issues and benefits involving the food and beverage industry, as Kelly maintained you could. And more fundamentally, it assumes that the food and beverage industry constitutes the sole or only cause of obesity.
Many have characterized obesity as a truly wicked problem, one that is difficult or impossible to solve due to the incomplete, contradictory and changing requirements. Wicked problems are resistant to effective resolution because of complex interdependencies. Efforts to solve one aspect may reveal or create other problems.
In 2007, the U.K. Foresight Report, chaired by the chief scientific officer to the U.K. prime minister, illustrated how truly wicked obesity is. Sir David King stressed that no one policy will fix the problem of obesity, that the epidemic had indeed been caused by human biology coming out of step with the structure of society, including the role of industry, but that solutions will take time and needed to be implemented through what he called our structured, comprehensive collaboration. The report explicitly mentioned actions that should be taken alone and in concert with government, and I won't go into what they are.
He drew very important analogies between obesity control and tackling climate change, another wicked problem. Both require unprecedented cross-departmental and intersectoral collaboration within government and partnerships over the long term with industry. The collaboration with industry on climate change started even as many in industry still denied the evidence on the links between industrial action and climate change and were still dependent on business models that promoted increased consumption and use of resources related to climate change. Think what Kelly said: The business model is fundamentally flawed. That was the case in climate change.
Participants in the annual Clinton Global Initiative meetings in New York cannot but be impressed by the speed of scale of new initiatives led by CEOs of energy, insurance, technology and related companies working closely with local and national governments in countries as diverse as the U.S., Brazil, China, Saudi Arabia, Denmark and more. They are betting big time on the emergence of a green economy that will encourage and sustain their new business models. The active involvement of insurers and co-insurers has brought new analytics to the business model with a focus on embedding risk into long-term growth.
What has this to do with obesity? Well, the multinational food and beverage model has favored the quality – quantity over the quality, and like the energy sector, increasingly recognizes that to change, it has to change its business model. And I witnessed much of that change starting to happen in the last five years. The intent of leading food and beverage companies to address obesity has increased sharply with change under way: R&D, linked product formulation aimed at calorie reduction, shifts in marketing, industry alliances.
Just five years ago, there was no International Food and Beverage Alliance that was transforming the way marketing is happening. There was no Healthy Weight Commitment Foundation across industry that is explicitly reducing calories in the supply – food supply of the USA, giving numbers to it and having the Robert Wood Johnson Foundation stand independently as assessor of it. There was no Alliance for a Healthier Generation that has led to 140,000 schools in this country eliminating soft drinks with very clear evidence of changes in calories.
At the same time, there have been sharp increases in individual company activities. And of course I have to quote the company I know best: PepsiCo's pledge to remove and eliminate the direct sale of full-calorie sodas from all schools worldwide has made progress and is in effect in 100 countries around the world. In the U.S., the total volume of PepsiCo beverages sold that are in the mid- and low-calorie range has sharply increased from 25 percent five years ago to 50 percent today and is likely to reach 75 percent within the next five to eight years. That represents millions of calories removed from beverages and suggests in time that nonalcoholic, nondairy beverages will constitute a minor source of calories in the diets. It's happening even in a recession, and it's happening even where the pressures are high for short-term gains.
Despite this, I think the progress has been motivated by many of the indexes we have out there that reward companies for change and are leading to investor performance. The Dow Jones Sustainability Index, the Global Reporting Initiative and the new GAIN initiative, which colleagues in the audience may talk about, all are acting to reward and show which companies are making progress.
MR. BOLLYKY: Derek, if you'll sum up –
MR. YACH: OK. In a major report by Bank of America Merrill Lynch out recently called "Globesity," unlike 10 years ago, they argued that there are companies who are actively engaged in addressing obesity over the next 25 years and named many of the food companies, including PepsiCo, along with pharmaceutical weight management, as being those to invest in if you want to invest in the companies that have the best chance of addressing it.
Let me just end off with the words of President Clinton when he addressed his advisory committee earlier this week, because I believe very strongly in the vision that he put out. He summarized what he saw as the key to tackling the most complex and pressing problems of our time, and his words were: We need a network of creative collaboration between those who disagree on some things but can and must work together on other things. That's my view and a better way forward than accepting proposition one. Thank you.
MR. BOLLYKY: Great. Kelly, two minutes, please.
MR. BROWNELL: Thank you. Derek began his comments by talking about the contribution of the food industry to correcting world hunger. And I agree; there are some notable advances the food industry has made in that arena. However, correcting hunger is consistent with the food industry aim to sell more food. Now we're at a different place in world history where selling more food is a problem rather than helping correct a problem.
Derek also mentioned that the food industry shouldn't be singled out as the sole cause of the obesity problem. I don't know anybody in the public health profession who would disagree with that premise. There are obviously many causes; governments and public health officials are working on all of them. And to talk about the food industry role doesn't imply that they are the only cause.
Derek talked about the environmental – the polluting industry denying claims between their industrial acts and negative impacts on the environment. How different is that from leading officials of the food industry now denying links between consumption of their foods and risks for things like obesity and diabetes when the risk for these things is quite clearly established in science? It is true that industry is behaving differently now than they did some time ago, and the question is why. Are they motivated to address public health issues? Should they score good-guy points, or are they being bludgeoned into having to act in the ways that Derek mentioned?
The obesity problem has been a major source of death and disability in the United States for about 30 years, even going back a little bit more. And during that 30-year period, the industry did everything it could to sell more unhealthy food, particularly to children. Now, in recent years they are showing some signs of change, but not, I don't think, because of good will or corporate design that this is a good business model. I think they're being forced to do it. Some companies, like Pepsico, are doing it better than others, but there are many laggards out there as well.
And I'll end with the following example. Derek said that the food industry embarked on this benevolent event, the beverage companies, by getting beverages out of, I think you said, 140,000 schools in the United States. Well, this becomes – you remember the old Whac-a-Mole game in the arcade that you played, where you knock down one mole and another one pops up, and they keep popping up and keep popping up until you're overwhelmed and you lose the game. So yes, they have withdrawn some of their beverages from schools. But this was in advance of legislation and regulation occurring all over the country that was requiring it. So they simply got out ahead, scored public relations points for it. But what about marketing of sugared beverages to children in other ways? We've done a major report on this. I'll be happy to point you to it online. And it shows that the exposure of American children to marketing messages for sugared beverages is as high as it's ever been and in some cases higher.
MR. BOLLYKY: Great. Thank you.
Two minutes, Derek.
MR. YACH: Yeah, I think when Edison turned on the light bulb and created General Electric over a century ago, the first goal was to try and expand as many light bulb consumers worldwide and increase energy consumption. That was General Electric then. General Electric today is a leader in sustainable development and thinking dramatically about how to continue to become one of the great profitable companies on the planet, continuing to provide energy but to provide it in a different, sustainable way using a different business model. It can happen.
I think the fundamental question that also needs to be asked is what's the alternative if you don't have the food and beverage industry at the table? The alternative is to go down a heavily regulated approach. And in the recent New England Journal of Medicine, there were two wonderful debates between Tom Farley arguing for regulations – soda taxes, regulating portion sizes, so on – and Brian Wansink cautioning against that route, arguing basically, quoting a wonderful line by Benjamin Franklin, a man convinced against his will is of the same opinion still.
Wansink's research has highlighted the range of simple interventions that nudge people into healthy choices and set them on a healthier default option to lead healthier lives. That is fundamentally where I stand. And I think that if we were to ask the question, what would happen if we used a mix of Farley and Wansink's best ideas together in ways that drew upon the power of markets, smarter incentives for food companies to change, subsidies for healthy food, shifts in defaults to reverse supersizing, more activity built into our daily lives, better use of social networks, rewards for health professionals and teachers who promote healthy eating and more activity, all supported by continuous communications and social marketing focused on key health messages developed by the best marketing gurus, not public health people, I suspect we would see real, faster and more sustainable progress.
Let me end by saying that Tom mentioned that we wrote an article a few years ago. Well, it wasn't that long ago. It was in Nature Medicine in 2006. We said then, unlike all other public health problems, there's still no demonstrated decline in overweight or obesity in any large country outside of a war or famine. That's still correct. This suggests that a higher degree of experimentation that draws on sound economic and behavioral theory is needed, as was the case with tobacco in the early '70s. I agree that's needed. That's why I've moved to an area where the focus of the work is on behavioral economics and actuarial science to change behavior.
But critically, Kelly and I both wrote that unlike the case of tobacco, market-led solutions, along with public policies, may combine to make healthy choices the economically easy and readily available choices. I believed this when I was at WHO and led efforts to engage the food company CEOs in building broader coalitions. I believed it when I wrote it with Kelly at the Rudd Center. I drew upon this insight in the last five years with Pepsico to motivate for internal change and external engagement and still continue to believe it.
MR. BOLLYKY: Great. Well, let's see, audience, are you swayed at all? If we could take an informal vote on the proposition again – let me read it out just quickly. The proposition is, again: There is a fundamental and irreconcilable conflict between the food and beverage industry's interests and public health policy interests on obesity. Can we see a show of hands if you support that proposition? Maybe slightly more are for the proposition now.
All right, well, let's move on to the second proposition. Again, I will read this. We will do an informal vote and then lead with Derek. The second proposition is, drilling down in a little more detail on this: Governments and intergovernmental institutions should not allow any person employed by the processed food and beverage industry or any entity working to further its interest to be a member of any body, committee or advisory group that sets, recommends or implements public health policies with respect to obesity.
Again, can we see a show of hands in the audience? Do you want me to read it again? I see at least one person who wants me to read it again. It's slightly longer, so I'll give it one more try: Governments and intergovernmental institutions should not allow any person employed by the processed food and beverage industry or any entity working to further its interests to be a member of any body, committee or advisory group that sets, recommends or implements public health policies with respect to obesity. Again, may I see a show of hands from the audience for the members of the group here that favor this proposition? All right, fewer are for this proposition. So I think Kelly will have his work cut out for him. But we start with Derek. Four minutes, please.
MR. YACH: Yeah, I would be happy to give you a minute to reflect deeply on the chilling effect that this would have on public policy across the realm. (Pause.) (Laughter.)
I'm not going to address the complexity of implementing such a policy, nor the near impossibility of spelling out who's covered by the very wide scope of the potential entities that are implied in proposition two. That itself would leave you with no choice but to reject the proposition. Let me rather ask what might happen to the quality of policy decisions made by leading policy groups like the National Institutes of Health (NIH), the Institute of Medicine (IOM) or WHO if proposition two was accepted and what they might mean for people's health.
Aaron Kesselheim, writing in a recent edition of The New England Journal, reported results of a randomized study involving 500 internists. They assessed scientific abstracts dealing with new drug treatments. They were given trials with three levels of methods rigor – good, medium, low – at three sources of funding – NIH, industry, none – none stated. The findings showed that the internists were half as willing to prescribe drugs from industry-funded study at each level of methods rigor. Think about that. They concluded that physician skepticism may have consequences for patient health, since many effective treatments would be overlooked. I suspect the same might be true if we did these on food-based solutions.
I'll explain what this means. Darren Zinner, writing in Health Affairs, showed that 50 percent of academic life scientists in the U.S. have industry relationships, and those that do are more scientifically productive. Citation indices, international presentations and patent filings are substantially higher. The nonconflicted pool, those who don't have relationships with industry, are less productive and less cutting-edge. Relying on them for IOM, NIH and WHO or related advisory structures would potentially limit public policy staying current and being based on the latest evidence. Instead of boycotting the most productive and probably the most creative scientists, better means of preventing undue and potentially conflicting influences are needed. The IOM processes seem ahead of the game on this, and NIH's efforts to continuously review how to limit conflicts through measures that go beyond disclosure – beyond disclosure are worth pursuing as a better means of maintaining access to excellence in the policy realm. And in the discussion, we talk about how do you go beyond disclosure.
I don't want to fall into the trap created by proposition two in the way it's framed. It implies that academics really have no competing interests while industry for-profit scientists and those linked to them do. Richard Smith, the previous editor of the British Medical Journal, and Richard Feachem, ex-dean of the London School of Hygiene, World Bank health director and the first head of the Global Fund on AIDS, Malaria and TB, somebody known, I think, to this audience well, writing in PLOS Medicine earlier this year, questioned the related assumptions that academics are neutral, disinterested, unbiased and supportive of the public interest. Public choice theory suggests that academics seek to maintain and increase their own influence in different ways. They foster links to WHO, foundation boards and NIH and IOM committees to further their career. They highlight how leading medical publications practice academic boycotts against scientists working for nonprofit groups.
I've experienced this firsthand while I was at Pepsico, with articles submitted to The Lancet, the BMJ, JAMA, to mention a few, being rejected on the grounds of my being affiliated to industry before the manuscript was even sent for peer review.
Proposition two would reduce industry investment and engagement in the very solutions we need to tackle obesity. To mention just one under way, EPOD is a set of community-based interventions applied in over a hundred communities in five countries around the world to prevent obesity in children. It's not known well here, but it should be, and it was exemplified in a major NIH meeting as one of the only solid examples of progress in obesity worldwide. It is the largest such initiative anywhere, and a recent review published last week in Obesity Reviews concluded that its success was based on four key factors: political commitment at the local and the national level, private and public partnerships, social marketing and evaluation, along with the content of the program. The program's detailed methods were outlined in articles and supported and co-authored by the co-chair of the International Obesity Task Force, Boyd Swinburn, one of our great leaders in obesity control and the NGO movement in the academics, and Susan Jebb, a lead researcher on obesity and the central person in the U.K. government's Task Force on Obesity, both being respected scientists. Evidence suggests that EPOD is underpinning progress in reducing obesity in kids in France and in many other countries. From the start well over a decade ago, it's been an effective private-public partnership.
I could give many other examples of where R&D from industry and their knowledge in science are well ahead of what is available in the public sector. Collaborative arrangements could stimulate better and faster solutions, as they have done in many areas of public health.
In summary, proposition two could systematically hamper the public health community from gaining access to insight and innovative ideas that could lead to better health policies and more effective interventions to address obesity. There are ways and means of strengthening concerns about conflict of interest, but boycotts are not the way to go. We need more, not less engagement. Reject proposition two to make that possible.
MR. BOLLYKY: Kelly, four minutes, please.
MR. BROWNELL: Thank you. When I read this proposition, I thought this was going to be extremely hard to defend because making a blanket rule that under no conditions at any time in history should anybody be involved is, as I said, difficult to defend. But I do think extreme caution should be exercised in having members of industry involved with policy decisions, and here's why.
It really comes down to a matter of trust. If industry is going to be sitting at the table helping make public policy decisions about issues that affect their business model, then can they be trusted to act in the public's interest or in the interest of the corporation? There are a number of case examples recently of whether industry might be trusted.
You may know that the city of Philadelphia came very close to passing a tax on sugar-sweetened beverages. Shortly after the tax was to be reintroduced by the mayor after it hadn't passed the first time around, the beverage industry – the trade association of the beverage industry gave a $10 million gift to the Children's Hospital of Philadelphia. Now, did that have a chilling effect on the hospital's ability to speak out against this issue? One can only speculate. Did it create beneficial public relations points for the industry that might have helped defeat the tax? One has to ask. So that $10 million given to the children's hospital creates a clear conflict of interest for the hospital. The hospital may do $10 million worth of good, but how much bad gets done if something like a tax or other public health measures get defeated? That's example number one.
A soda tax was also being considered in a small town outside of Berkeley, California, Richmond, California. It was defeated in a recent ballot initiative. But the industry came in and was said to spend about – spend about $2 million on what was thought to be about 7,000 people in Richmond, California, that were going to vote against this by creating something called the Community Coalition Against Beverage Taxes. Now, one can imagine what "community coalition" means here. It means the beverage industry. And this is stunningly akin to what the tobacco industry did to fight public health initiatives early on.
Another example – and this'll be the final one that I'll give. Due to the stimulus of the White House, a number of government agencies got together in what was called an interagency working group to create guidelines for what foods might be marketed to children. These were only to be voluntary guidelines, by the way. These government agencies, the Food and Drug Administration, the U.S. Department of Agriculture, the Federal Trade Commission and others, officials from these organizations, got together and proposed what most public health officials considered quite reasonable guidelines. And again, they were only to be voluntary. And you – as you know, people in regulatory positions in Washington tend to be fairly risk-averse and aren't likely to go out on the line to propose anything radical. The industry came down on this in an exceptionally hard way, putting pressure at all levels of government, so the whole process has essentially been frozen, and it's unlikely that those interagency working group guidelines will go forward.
So if this is an industry looking to be trusted, there's evidence out there about whether they're behaving in a trustworthy way. And I think we see example after example of this happening. One was the one I mentioned earlier about marketing to children. If the industry – the beverage industry was going to withdraw its products for schools – from schools and be true to the public health aims of this, it wouldn't ramp up its food marketing in other venues to keep that child market so protected. So the industry, I think, can be accused, rightfully so in at least some cases, of doing things that might look good but in fact aren't if you go further down the road.
So in my mind, the industry players should be allowed at the table, but not now. There will be a time when the threat of regulation and government legislation and perhaps even litigation will be so severe that there probably won't be any choice but the industry to behave in a cooperative way. At that point, I believe they should be invited to the table.
MR. BOLLYKY: Great, thanks, Kelly.
Derek, two minutes, please.
MR. YACH: The issue of trust is critical. And I'm thrilled we have Richard Edelman sitting in front of me glaring, trying to actually, I think, send over some vibes from the outcome of the Edelman Trust Barometer – (laughter) – which has been monitoring trust worldwide and shows that it's not just industry that has a problem with trust; it's government. And it's collapsed worldwide. And there are good reasons for it. So I don't think that we're going to solve the problems by using an argument of who we trust more than others, as opposed to putting in place means of assuring that you limit conflict, that you limit practices that we may not agree with.
Do I believe that many of the lobbying practices of the food industry, or in fact of many industry, maybe most industries, are acceptable? No, I don't. That obviously needs to change. That's going to be a bigger task that we all need to be – try and change to ensure maximum transparency. Do I believe that the front groups created are acceptable, whether it's front groups to promote the value of destroying the environment or promote some dietary practices that may lead to obesity or many other pharmaceutical practices or – again, I don't think that's acceptable. But that doesn't mean that you're going to be willing to boycott the active engagement of those in industry, using the right means of protecting conflicts of interest.
If I look to the structure of advisory boards I've had the privilege to sit on even while at Pepsico, the most extreme was the Institute of Medicine, where you had to go through a process of having your name put up in a public domain to ask whether there were concerns, and there are categories of deemed unavoidable conflict where there is knowledge and capability within industry that, if brought to bear in the public sector, could accelerate solutions, not retard them. I think we need to think about how we can reduce barriers of having that kind of input put on the table while simultaneously pushing ahead to better control the lobbying practices that Kelly spoke about.
I don't think the two are in conflict. I learned a long time ago, actually from a good friend of Clarence Pesson sitting in the front row, somebody who this room probably knows, Harlem Cleland, many years ago, a great person at the State Department I think in the '60s, '70s, who, in a meeting that Clarence hosted way back, was asked, what is the central issue you've learned in trying to resolve complex disputes between parties who can't talk together, who should be kept apart? And he summarized it really in two words: constructive ambiguity. (Laughter.)
We have to recognize that while we can't always have everything correct at the table, drawing the opponents into the debate from both sides changes them forever and gets them more engaged in solutions that neither party will be aware of. As a South African, I know that all too well, having seen what it meant if things went wrong in my own country, and I don't think obesity is a bigger problem to tackle than the problem of what could have happened in South Africa if you hadn't gone down the route of constructive engagement. Thank you.
MR. BOLLYKY: Great. Kelly, two minutes, please.
MR. BROWNELL: Thank you.
When Derek was making his initial comments about industry funding and conflicts of interest, he made the point that industry-funded scientists are more productive and more highly esteemed in the field than people not funded by industry. One wonders about the causal arrow there, because of course, industry is not going to choose to seek out to fund the low performers, the low-productive people, the people who will have no value back industry if they're signed on as advisory group members, as scientists of published studies and things like that. So my guess is that's a spurious relationship, and the causal arrow goes from productivity to industry funding rather than the other way around.
It's also become appealing for the people who favor industry involvement in things to dismiss the apparent and sometimes blatant conflicts of interest by saying the people who aren't funded by industry have biases too. And in some ways, they're basically showing that everybody is a human being. Of course we're all biased in some way. Of course we all have opinions. Of course we're all motived to have our work funded and things like that. So you begin with a certain level of human being bias. But then the question is whether adding industry money on top of that creates unacceptable levels of bias that distort public policy, distort drug approval, distort those sort of things. Then if that – if the answer to that is yes, then you've got real problems, and I propose to you that that's the case.
So I believe, again, that industry has an enormous amount of creativity within it. There is a great deal of possibility for coming together with industry to form solutions, and I think there are signs of that happening in some cases. But the question is whether this should occur under conditions where money changes hands. If scientists wanted to serve on advisory boards for industry, fine. Pay their own way, don't take speakers' fees, don't have any money changing hands. If industry wants to fund money instead of giving money to particular scientists to produce particular outcomes and studies, put it into a pool that's monitored by some group like the National Institutes of Health. That could then fund individuals to do research so the industry isn't – the researchers aren't accountable to industry to produce certain results so they keep gravy train coming.
OK, I'll stop there. Thank you.
MR. BOLLYKY: Great. Thank you.
Quickly, let's do a vote because I want to get to the Q&A. I'll read it quickly again: Governments and intergovernmental institution should not allow any person employed by a processed food and beverage industry or any entity working to further its interest to be a member of any body, committee or advisory group that sets, recommends or implements public health policies with respect to obesity. Can I see a show of hands for those that favor this proposition?
I think we're about – maybe actually a few more who are now for the proposition.
MR. BROWNELL: No, that's at least double the support, actually. (Laughter.)
MR. BOLLYKY: Before I turn it over to Q&A let me tell you where these propositions came from – these propositions are taken either verbatim from the Framework Convention on Tobacco Control itself or the guidelines issued by the conference of parties. The only changes that were made were basically to do a find and replace for the 'tobacco industry' with the 'food and beverage industry' and 'obesity' with 'tobacco control.' (Mild laughter.) So I leave you with that to think about.
And with that, I ask those who'd like to speak to raise their hands. When the microphone comes to you and I call on you, if you could just state your name and your affiliation. Rachel?
Q: So I'm Rachel Robbins, most recently with International Finance Corporation, and – as the private sector arm of the World Bank Group –
MR. : (Off mic.)
Q: It's not on? (Off mic.) OK. OK. So I'm Rachel Robbins, most recently with International Finance Corporation, which is the private sector arm of the World Bank Group. And we obviously believe very closely in public-private partnerships and the role of the private sector in addressing social issues in a sustainable way.
So my question is really for Derek. I think both acknowledged what the private sector can bring to the issue, but there is the conflicts question. So Derek, what are the steps that could be taken, in addition to disclosure, to allow the private sector to add the value and address the concerns?
MR. YACH: Yeah. I think there are procedural issues. For example, disclosure needs to be much more aggressively pursued. I think – I suspect at the moment we're not fully disclosing and people don't fully disclose when they have worked for or are working for industry.
We also need to expand what we mean by disclosure. I think a look at Richard Feachem and Richard Smith's article suggest that we need to balance what is a narrow assumption that if you're working for industry, you've got to declare conflict; if you're not, you have no conflict. I think – be more sophisticated about it.
But then I think there's a deeper question: Which part of the policy process is it OK for the industry to be engaged in, and which part of the policy process should actually be kept out of the realm? And that includes the realm of protection against undue lobbying and so on.
And I've always felt that there are three processes of policy development. There is the development phase: When you're looking at all the options on the table, industry has to be there because they can put on the table options that the public sector will not even dream of are possible. There is the middle part, which is the part when you have to go into closed doors and do the hard politic and what's going to make it. Industry should be out of the room when that happens. When the decision is made and the implementation phase happens, industry has to be at the table on implementation. And I think that uses their capabilities without having the undue influence at a critical point.
MR. BOLLYKY: Kelly, would you like to answer that questions as well?
MR. BROWNELL: Well, it was – (inaudible) – really admire what you just said. And it seems like when you said the industry should be out of the room when the policy decisions made are made or voted on is absolutely what this proposition was all about.
MR. : (Off mic.)
MR. BROWNELL: So it – that's an interesting thing to think about.
So again, I think industry has a role to play here. What's fascinating to me is that these propositions came out of the Framework Convention for Tobacco Control. So one question is, how different can the food industry be than the tobacco industry? Are the people who run it more moral, more ethical, more public health-minded? Or are they – are they governed by the same set of industry and financial contingencies that make certain behaviors inevitable in that industry?
Now, one could claim that food and tobacco are different substances, and clearly, they are. And the old argument that, well, you don't have to smoke, but you have to eat comes up every single meeting. And I – if I hadn't said it, I'm sure somebody here would have, and that's absolutely true. But it doesn't mean that you have to drink Coke, and it doesn't mean you have to eat Cheetos and things like that.
And so the question is, can we expect anything out of the food industry other than what we saw in the tobacco and alcohol industry? Because they're governed by the same set of rules.
MR. BOLLYKY: Great. I saw Laurie first, then Richard, then Mike and then the gentleman back there.
MR. BOLLYKY: We have – just to give you a sense, we have 10 minutes left, so if you can try to keep your questions short.
Q: I'm very glad that we're not revisiting the Dan White "Twinkie defense" for the assassination of Mayor Moscone and Harvey Milk in San Francisco.
Just two quick questions, one to each of you. Kelly, you opened by telling us that – oh, I'm Laurie Garrett of the Council – you opened by telling us that you've gone to Duane Reade and found that on a volume basis, Coca-Cola and Pepsi were half the cost of bottled water. Since Coca-Cola and Pepsi are the two biggest manufacturers of bottled water in the United States, are you implying there is a sort of conspiratorial and deliberate thing in price control and something of that nature?
And to Derek, it's been widely reported in the business and financial press that the board of directors of Pepsi put a lot of pressure on your CEO to – because there was a sense – there was a split within the board, it was – it is reported, that the so-called healthy product line was underperforming and underselling and perhaps should be dismissed or discarded or paired back because it wasn't profitable. That seems to go right to premise number one that we debated. So I wonder if you could clarify that.
MR. BOLLYKY: Great question. Kelly?
MR. BROWNELL: OK, the bottled water issue. I can't look into the minds of the industry people and know intent. But if you look at the water costing less than Coke or Pepsi and the fact that more manufacturing is required to produce the latter rather than the former, you have to wonder what's up and what would motivate industry to do that. And my own guess – but again, I can't know the motives of the industry – is, as I said, people don't overdo it with water; you drink until you're hydrated, and then you stop. But with things like Coke and Pepsi and the other sugared beverages or just exemplars of that larger category, people go beyond the point where they need to be hydrated because the taste is so good, possibly because of the activity of sugar on the brain, triggering the same pathways that traditional substances of abuse do, and the very heavy and gratuitous addition of a known addictive substance, caffeine.
MR. BOLLYKY: Great. Derek.
MR. YACH: Thanks for that really nice question, Laurie. (Laughter.) Anybody who knows Laurie knows you can expect that.
I think, Laurie, first, Indra Nooyi gets the arc of history. She knows exactly where the long-term future lies. I think the entire board and all the senior executives I know also understand better the long-term. It is inevitable that the demand and the supply of healthy food has to increase. The question is one of a short-term nature. How do you deal with a reality of us being in an unprecedented period of recession when commodity prices have changed dramatically forever and the very business models that underpin healthy food have to be rethought in fundamental ways?
The good news is that that past is now past. The February period, when we had all the hype and discussion, is there. If you look at what's on the shelves, I mentioned the transformation of Pepsi's core brand. Who would have thought you'd be at 50 percent by volume being low and mid-calorie, 75 percent in a few years? Who would have thought – anybody Mountain Dew drinkers or be a Mountain Dew drinker in this room? Well, they're a very particular group. Who would have thought that Diet Mountain Dew would become a billion-dollar brand among the same population who drink Mountain Dew, and that would happen in a relatively short time? Or who thought that Trop50 would come from nothing to be a brand that's taking off or that would be in the chick pea and hummus business, which would be the largest hummus business and healthy food in the world, now showing good returns on investment, or that we would have launched a dairy business focused on some of the low-fat and healthy dairies with Muller that is also doomed to take off for the quarter-billion dollar investment in upstate New York? That doesn't sound like a company that's stepping away from the healthy food future but one that's continuing and accelerating the transformation.
And I might add that unlike what Kelly would lead you to believe, the food industry hasn't been increasing the levels of salt, sugar and fat in their brands; it's been reducing them. And it's actually got a scorecard it can give you on the rate of reduction, which may not be as fast as everybody wants, but it is pretty much going down.
MR. BOLLYKY: Great. I'm going to take questions in two. We have about five minutes left. So Richard first.
Q: Very quick: Kelly, you made the assertion that you do not believe that food companies can have a –
MR. BOLLYKY: The microphone's coming.
Q: Sorry. Sorry. Sorry. Sorry.
MR. BOLLYKY: And if you could just state your name.
Q: Yes. Richard Edelman. You made the assertion that food companies cannot get forward on the basis of higher-priced lower quantity foods. I'd like to know your evidence for that claim because in fact, I do believe that PepsiCo was trying to do the opposite, and they're also trying to go into different categories where that has been evident to work.
MR. BROWNELL: All right. It's a wonderful question.
MR. BOLLYKY: Great. Go ahead.
MR. BROWNELL: And I would be absolutely delighted if it turned out I was wrong on this and that people were willing to pay for quality rather than quantity of food. There certainly is a market niche for this, and I think none of the companies want to be left out of this movement. So you have the Whole Foods catering entirely to that kind of group. You have McDonald's offering yogurts and things like that. So all – every company is doing this, more or less, and they don't want to – they don't want to miss the niche. But the question, is that niche big enough to really constitute a public health advance, and is the industry doing what it can to get people away from the unhealthy foods and toward those foods, or whether they're just meeting a need that exists anyway.
MR. BOLLYKY: Great. Mike and then the gentleman back there.
Q: Mike Hodin, the Council. So I guess my question is a – is a prior one, which seems to be the undercurrent. Namely, what do we think this animal, the horrible, evil – what used to be the multinational, today is the global corporation, what do we think the character of the global corporation is? And if we think it is one that is like the '50s or even '60s, that leads you down one path. If you think that it is one that is of a 21st century model with a different set of motivations, a different set of stakeholders, a diversity of opinion, people, ideas and globalization, a very interesting kind of character and makeup, perhaps that leads down to a different path. And so the profound structural shift of what we know today as the 21st century global corporation, which is different than the one that appeared in the literature of global reach and the others that we know from the '50s and early '60s, might go to a place where we define trust and motive a little bit differently.
MR. BOLLYKY: OK. And the gentleman back there.
Q: Hi. I'm Sanjay, Sanjay Sinho, from American India Foundation. I just wanted to ask on the second proposition, because I think the way the second proposition read, it was very difficult to sort of agree to it. And specifically, I'm a believer in collaboration, and I always feel that the best collaborations are, in the collaboration which happens with partners which have maximum tolerable unlikeness. I think the maximum tolerable unlikeness principle really helps in collaboration, so I didn't agree. But at the end of the debate I agreed with the proposition. Kelly, you did a great job. (Chuckles.) But I do want to ask you, you said that maybe they don't require a seat on the table now but maybe later. So what would be your time frame, and what benchmarks would you think would be when the food and beverage industry would be adequately sort of mature to have a seat on table?
MR. BOLLYKY: Great. I'm actually going to take this gentleman's question here because he's the last one and then allow you to answer the three questions in your summing statements, because we have about three minutes left.
MR. BROWNELL: Oh, OK. Thanks.
Q: Question – (inaudible) –
MR. BOLLYKY: Just your name and affiliation, please?
Q: Nick Freudenberg, City University of New York, School of Public Health. What if we were to offer the food and beverage industries a choice: Either they and their representatives can participate in scientific and policy debates, or they can contribute through lobbying and campaign contributions, but not both. What would you think of offering them that choice?
MR. BOLLYKY: Great. So to recap the questions: Have corporations changed over the last 30, 40 years; what time frame would you be thinking would it be acceptable for industry to be at the table in this policy debate; and then the choice on lobbying or participation in advisory boards.
MR. BROWNELL: Me first?
MR. BOLLYKY: You first.
MR. BROWNELL: OK. First, I don't profess to be an expert on corporate behavior, but my outside looking-in opinion is that they are changing, and there are some really very well-minded people and obviously bright, committed people inside the corporations. And if there is a –
MR. : (Off mic.)
MR. BROWNELL: OK, good.
MR. : (Chuckles.)
MR. BROWNELL: No, I think – (chuckles) – no, I think that that's really important. In fact, that makes me quite open to collaborating with industry and interacting, so – at our center, for example, we've had delegations come from PepsiCo, from other companies, General Mills, Kellogg, Post – I can go on with a long list. And we're more than happy to talk and try to interact in as constructive way as possible.
We just don't want money changing hands because I think that's what – that's what starts to affect things. Derek mentioned that we need stronger rules for disclosing when money changes hands, which I agree with, but there is a fundamental problem with looking at things that way. If there weren't anything wrong with it, why would you have to disclose it in the first place? And then is the resolution to that problem disclosing the ill behavior or trying to get of it? And that becomes interesting.
And then there is also something funny about saying – (inaudible) – I was going to say, there is interesting research showing that disclosure may make things worse, that an audience who hears a message where the person has disclosed a conflict of interest will discredit the source, but only a small amount, but the source who's made the disclosure feels licensed to make their message even stronger, and so the disclosure doesn't seem to have a beneficial effect overall.
MR. BOLLYKY: Kelly, can I get you to answer the question on timing, then I'll let Derek answer the choice, because I think we're out of time.
MR. BROWNELL: The question on –
MR. BOLLYKY: On timing.
MR. BROWNELL: OK, I –
MR. BOLLYKY: The gentleman back there. When is it acceptable for the industry to participate?
MR. BROWNELL: Oh, yes, yes. Thank you, I forgot. Yes.
I think we're getting close to the point where industry can probably be engaged in a constructive way because I think the pressure on industry, at least in the United States, is increasing, and there is a great threat of regulatory threat, I think. And there might even be litigation threats that would bring industry to the table more readily. So I think industry, until it's forced to change, won't, but now that it's being forced to change, will. And the time is probably pretty close. But at the moment we have to be pretty darn careful.
MR. BOLLYKY: Great. Derek, can you – on the choice between lobbying and advisory committees.
MR. YACH: Yeah. I'll take the first, and I would hope companies would. I think the companies of the 21st century that are going to succeed are going to want to put their scientists, the technical expertise, in close proximity to others to find solutions and realize there is plenty of money to be made when you actually apply your minds to doing it, and the lobbying stuff can then start falling away.
MR. BOLLYKY: Great. And with that, I would like to close. First of all, join me in thanking these very brave and effective speakers. (Applause.) And thank you all for coming.