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  1. Analysis
November 2, 2006

Obesity, labelling and red tape dominate food industry concerns

Representatives from the EU food and drink industry were in Brussels last week for a biannual meeting organised by their industry association, the CIAA. Dominating the agenda was concern over the correct industry response to the increasingly worrying problem of obesity. Chris Jones reports.

Representatives from the EU food and drink industry were in Brussels last week for a biannual meeting organised by their industry association, the CIAA. Dominating the agenda was concern over the correct industry response to the increasingly worrying problem of obesity. Chris Jones reports.


The –EU food and drink sector is the bloc’s biggest manufacturing sector, with around 300,000 companies and a turnover of €800bn (US$1.02 trillion), and as a consequence it is frequently in the spotlight. In his keynote speech, Unilever chief executive Patrick Cescau recognised that the food industry had played a part in rising obesity levels. “While we were focused on issues of taste, convenience and value, consumers were getting fat, unfit and progressively unhealthier,” he said. “Some politicians, NGOs and consumer groups, as well as parts of the media, were accusing us of being the root cause of a major public health crisis.”


Cescau said data from the UK showed that people were not consuming more calories than they did 60 years ago, but that they were expending far fewer of them – reflecting the two sides of the obesity debate. “Obesity is a multi-faceted problem. It has as much to do with the lives that people choose to lead as the food they eat,” he said.


But while he stressed that the food industry could still do more to “rebuild public confidence in our brands”, through reformulating products, better labelling, improving health claims and a more responsible approach to marketing, there were limitations to what could be achieved.


“Many critics are urging us to go further and faster [on reformulation]. My response to them is that we can only move at the speed of the consumer,” he said, citing the example of salt, which is also a flavour enhancer and cannot be removed entirely from products without significant changes to the taste profile, something that many consumers are simply not prepared to accept.


On labelling, meanwhile, there was still disagreement between the industry and some governments or consumer groups over the most efficient system. Traffic light systems, such as that being pushed in the UK, could send the wrong signals, he said, since products such as butter and low-fat spread could both be flagged as red, suggesting they were each as bad as each other – a position backed by Adam Jackson, director of public policy at UK retailer Tesco, which has defied the British Food Standards Agency and adopted a front-of-pack labelling scheme which focuses on guideline daily amounts.


Jackson said that the scheme, which has been rolled out to the majority of the retailer’s own label products and adopted by many of its branded suppliers, had had a major impact on sales of certain “unhealthy” products, prompting the group to reformulate a number of them – clear evidence for Tesco that simple schemes work best. According to Cescau, the Tesco example shows that “our judgement should be based not on which scheme the consumer prefers, but on which scheme drives the right behaviour. This should be evidenced by what people actually put in their baskets in real life shopping situations.”


Cescau’s comments were backed by data presented by Josephine Wills of the EU food information council (EUFIC). She said that most of the data on the efficacy of nutrition labelling schemes came from one country alone – the UK, where around 85% of products carry such labels, compared to 35% in most other EU countries – and that most of it was based on questionnaires and sampling, rather than an examination of what people actually buy.


“We still have virtually no insight into how labelling information is or will be used in a real world shopping situation, and how it will affect consumers’ dietary patterns,” she said. “Understanding on-pack nutrition information in isolation is very different from understanding what this information means in the context of a weekly shopping excursion or composing a balanced diet.”


On health claims, Cescau said the new EU regulation – due to be finalised soon – would be a great step in the right direction, provided concerns over the creation of a standard EU-wide system of nutrient profiles are resolved. “We are concerned that some national authorities will not allow products on the market until the process of finalising the nutrient profile model and agreeing the health claims list is complete,” he told delegates.


When it came to responsible advertising, trust was also a major issue, according to Cescau. “I am not convinced that citizens and legislators across Europe feel that we can be trusted to regulate ourselves,” he said. “We need to prove them wrong by tightening our codes and enforcing them rigorously.” The issue of trust was reiterated by Robert Madelin, head of the European Commission’s health and consumer protection department, who said that the question of how best to regulate the advertising of food, especially to children, had been discussed earlier this year by a high level expert group.


“Trust is now a key problem,” he said. “Self-regulation cannot be seen as an alternative to the law, but we are not necessarily suggesting that co-legislation is the best way forward either. In fact, there is a grey area between co-regulation and self-regulation in which most of the current models exist. We have seen that there are good examples of self-regulation in every EU member state – the question now is how to spread these examples of good practice to other countries. There is a new clarity that self-regulation can help with the question of trust.”


The CIAA is keen to fend off the threat of tougher advertising rules amid growing calls from some EU legislators, not least in the European Parliament. CIAA president Jean Martin and a delegation from the food industry visited Commission president José Manuel Barroso during the two-day congress to reiterate calls for better regulation and less red tape, which Martin claimed “hinders innovation and hurts Europe’s competitiveness”.


“The food and drink industry is one of the most regulated sectors in Europe. Better regulation, including industry self-regulation, can deliver benefits to European consumers faster and create more jobs and growth than old-style outright regulation,” Martin said.


But while many of the speakers at the congress went to great lengths to stress the commitment of the industry as a whole to tackling obesity, they also pointed out that the food and drink industry remained above all a business, and one that had to continue to find new ways of making profits. Tesco’s Jackson, for example, pointed out that the chain’s GDA labelling scheme had helped give it a major competitive advantage over its competitors, while many of the other speakers highlighted their new product launches, labelling systems or sponsorship programmes that had helped improve their financial performance as much as their image.


It was up to Jim Murray of EU consumer group BEUC, a frequent critic of the food industry in the past, to underline this apparent dichotomy between doing what is best for consumers or what is best for shareholders. “On issues such as health claims and self-regulation, consumers remain very sceptical that the food industry really has their well-being at heart,” he said. “We don’t necessarily believe that all scientists who work for the food industry are not trustworthy, it’s just that there are issues that still need to be sorted out to convince everyone that this is the case.”


 

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