As the UK government introduces new measures to tackle obesity, Ellie Chapman, ShareAction’s Head of Food & Health, examines what this means for food manufacturers. In our new briefing we find that this concentrated sector is not yet rising the challenge.
It’s been a landmark week for the fight against obesity.
Announcing a swathe of new measures, targeting the promotion and sale of unhealthy foods, the UK government took aim at “unhelpful influences like promotions and adverts” – highlighting the damaging role these have played in what we buy and eat.
The new measures will see ‘buy one get one free’ deals on unhealthy foods banned, restrictions introduced on where unhealthy foods can be promoted in stores, and an end of junk food adverts before 9pm.
Added to existing interventions – such as the sugar levy on soft drinks and a ban on sales of energy drinks to children – these measures will aim to take unhealthy food out of center stage.
For food retailers and manufacturers, the new measures represent a massive shift in the way they do business.
Responsible companies must commit to ending the flood of unhealthy food and support their customers to eat healthier, by ensuring healthy choices are available, accessible and affordable for all.
Covid-19 and the fight against obesity
So, what shifted a libertarian government to get tough on food choices?
The public health case for government intervention on obesity is not new. Two in every three adults and a third of children in the UK are considered overweight or obese, costing the NHS an estimated £6.1 billion every year.
But the Covid-19 pandemic has shone a spotlight on this existing health crisis.
Emerging evidence has identified excess weight as the second leading cause of complications from the virus after old age.
In the UK, data shows that obesity raises the risk of death from Covid-19 by 33 per cent.
Over 70 per cent of all intensive care patients with the virus have been either overweight or obese.
The UK Prime Minister’s own brush with the virus – which saw him spend a week in hospital, including in intensive care, appears to have triggered a personal U-turn on the issue.
Combined with overwhelming public opinion in favour of intervention and a want to shield the public and build resilience against current and future health crises, this has driven an acceleration of measures to tackle obesity. With on-going consultation imminent, companies should only expect greater regulations to come.
Are food manufacturers ready to tackle obesity?
Yet despite dire warnings from public health experts, and a growing demand for healthier foods, the food and drinks industry still appears largely unprepared to respond to these changes.
Earlier this year, we examined what actions UK retailers were taking to tackle the risks associated with rising obesity, and found widespread inaction.
Now, in our latest briefing we have focused on food and drink manufacturers, and again we find there is a long way to go.
Despite the clear risks and opportunities at play, most food manufacturers – much like their retailer counterparts – are failing to disclose critical information on the healthiness of their product portfolios and sales.
Where that information is available – usually thanks to the work of third parties – it shows there is a lack of action towards building healthier diets.
A recent report from the Access to Nutrition Index – produced for our Healthy Market’s campaign – showed that 69 per cent of packaged food and drink products are unhealthy. 85 per cent are unsuitable to market to children.
Data from Public Health England is equally bleak. It shows that the food and drinks industry has only delivered a 2.9 per cent sugar reduction since 2015.
Their target is to reduce sugar by 20 per cent by 2020.
Companies must step up on unhealthy food – and so must their investors
Despite the apparent variety in the food and drinks product available to us, the industry is highly concentrated.
In the UK, just a handful of companies make the majority of the products consumed. Yet the industry is worth some £105 billion.
This means that the major decisions shaping our diets, are made by just a few players.
They have the power to shape our food choices. And the responsibility to promote healthier diets across the nation.
This provides an important opportunity for investors. And there is a growing appetite to take action towards building healthier portfolios.
Just this month Nest and EQ investors publicly joined ShareAction’s coordinated call on at Tesco’s AGM to ask the company to be more transparent and shift sales towards healthier food choices.
There has not been a better time for investors to put the food industry on a diet.
By asking food and drink manufacturers to make and sell healthier products, responsible investors also have an opportunity to drive positive corporate change as well as protect future returns. Doing so will push significant progress in the reduction of childhood obesity in the UK and around the world.
ShareAction’s coalition of investors continues to work to boost disclosure and performance of manufacturers and retailers operating in the UK market. For more information on joining the coalition visit our Healthy Markets campaign.