January 31, 2014
It is possible that Oxfam’s decision wasn’t entirely based on the anti-Israel bias of its London-based leadership. One of the leading corporate donors to Oxfam just happens to be the Coca Cola Company that has given millions to the group. That tie between a company that can be linked to obesity and bad nutrition and a charity that promotes feeding the hungry is seen as a contradiction by some and only explained by the cash that flows from Coke to Oxfam. But the fact that SodaStream is a competitor that is already eating into Coke’s market share could account, at least in part, for Oxfam’s speed in denouncing Johansson.Sure enough, after some digging, I found that in 2011, Coca Cola contributed $400,000 to a research project “analyzing the poverty footprint of beverage giant Coca-Cola and multinational bottling company SABMiller in Zambia and El Salvador” and, in addition, $2.5 million in 2008-2010 for humanitarian work. This has raised some concerns regarding Oxfam’s impartiality towards Coca Cola.
The Oxfam Poverty Footprint Report describes the work Coca-Cola and SAB Miller are doing in Zambia and El Salvador to empower and promote sustainability. It highlights Coca-Cola’s sustainability initiatives.And here’s another example:
It does include some telling recommendations for follow-up. For example:
You have to read between the lines to see what this report really says.
- Engage sugar farmers and producers to improve safety and health of sugarcane harvesters.
- Investigate why independent truck drivers in Zambia work more than eight hours per day and discuss with drivers potential mechanisms to ensure safe driving.
- Ensure The Coca-Cola Company’s global Advertising and Marketing to Children Policies are being effectively and consistently implemented at a regional level.
And what about health, obesity, or the shocking increase in childhood tooth decay that is occurring in Latin America these days as a result of the influx of sugary drinks? Not a word.
Why is Oxfam America helping Coca-Cola to market its products in Latin America and Africa? I can only guess that Coca-Cola’s grant to Oxfam must have been substantial.
First, the report appeared to credit the companies with contributing more than $100 million in economic activity to the local economy, generating millions of dollars in tax revenue for local governments and creating many thousands of jobs. However, after reading the report closely and asking Oxfam staff some questions about it, I think readers should be careful not to think of those dollars and jobs as a real impact of Coca-Cola’s presence.This is not to say that Oxfam hasn’t criticized Coca Cola. For instance, they have specifically called on “the world’s biggest sugary beverage companies, Coca-Cola and PepsiCo, to help prevent human rights violations in their supply chains.” (Although criticizing its main rival Pepsi at the same time negates the “damage”). As it turns out, Coca Cola responded, resulting in Oxfam praising them for declaring “zero tolerance” on this matter, and filing a shareholder resolution urging Pepsi to address the issue. Not to mention engaging in some good old fashioned bating.
The report itself has a bold statement of its analytic goals:
Oxfam is developing the Poverty Footprint Methodology as a means to understand the full range of impacts multinational corporations have on poor communities, and to provide a platform for engagement around those impacts.The report’s most important quantitative results imply the companies have a large and beneficial macroeconomic impact:
An examination of the Coca-Cola/SABMiller value chain’s macroeconomic impacts reveals that its Gross Value Added (GVA) in 2008 was approximately $21 million in Zambia and $83 million in El Salvador. In addition, the Coca-Cola/SABMiller value chain supported an estimate of more than 3,741 formal and informal jobs in Zambia and 4,244 formal jobs in El Salvador.However, these numbers are not a correct estimate of the companies’ “footprint” or impact on local economic activity, tax collections, and jobs. If Coca-Cola did not exist, or were not allowed into Zambia and El Salvador, two things would be different from the current situation: (a) other beverage companies, including local companies, would sell more product, and (b) other beverages, including traditional beverages and water, would provide a larger share of the consumer’s hydration needs.
If other beverage companies took up the slack, much of the economic activity and tax payments and job creation would have happened anyway. It would be interesting to know how much profit Coca-Cola takes out of the local economy and returns to international shareholders in the United States and Europe. At times, the Oxfam report appeared to be addressing the issue, but it didn’t really. Buried deep in the report, footnote 22 on p. 84 acknowledged: “The Coca-Cola Company’s profit information was not shared with the research team.”
I asked Oxfam if the analysis compared the situation with Coca-Cola to a situation without Coca-Cola, which is the relevant comparison for assessing “impact.” Helen Dasilva of Oxfam replied, “The objective was not to compare an economy with the system to an economy without.” The result is to give the companies credit for big dollar impacts that overstate their real contribution to job creation and the economy.
—-Second, the report included no critical discussion of expanded consumption of sugar sweetened beverages, displacement of traditional foods and beverages in the diet, and rising rates of overweight and obesity in developing countries.
When I asked Oxfam about this, Dasilva responded:
The focus of this project was not to study or address the issues surrounding obesity, nor did we conduct an analysis of the impact of Coca-Cola products on overall nutrition or health. That was a result of our limited bandwidth.—-Oxfam’s independence from Coca-Cola messaging
Third, because of the joint authorship, it is impossible to tell what parts of the report are Coca-Cola writing, and what parts are Oxfam writing.
I asked Oxfam if this joint authorship caused the organization to make compromises in the language it would have used in a report that it authored independently. Dasilva responded:
Bringing two significant multinationals and a global development organization together to agree on language in any report will be challenging. This report was no different and the result isn’t perfect. While it is safe to assume our varied cultures, missions and ways of working led to differences of opinion, it would be tough to pinpoint specific language differences given how many comments from all sides went into the final document.
It is difficult to surmise how much of this is based on real considerations and how much on bias towards Coca Cola.
In addition, Oxfam has consistently awarded Coca Cola a higher Company Scorecard (measuring major brands on policies on issues from water to women, the way they expect their suppliers to behave on these issues, and what they do to measure and improve their impact on every worker and farmer who makes their ingredients) than Pepsi. Again, its hard to know if bias towards Coca Cola plays a role here.
So the question remains: Is Oxfam’s opposition to SodaStream and Scarlett Johansson’s role as brand ambassador due to their anti-Israel bias or pro-Coke bias?
Or perhaps a not-so-sweet combination of both.