cookie2Every so often your writer is reduced to scratching his head bemusedly at what leftist religious shareholder activists deem worthy of prioritization. Whether based on religious faith or not, it always seemed to me shareholders’ concerns should be maximization of return on investments rather than reshaping the world into a progressive utopia.

Yet here we have the religious shareholder activists of the Interfaith Center on Corporate Responsibility and Boston Common Asset Management celebrating a victory that their press release practically equates with alleviating world poverty, hunger and disease. Yes, dear readers, ICCR and BCAM successfully convinced Mondelez International Inc. – the corporate bogeyman responsible for such crimes against humanity as the delicious snack foods Oreos, Cadbury, Ritz Crackers and Triscuits – to drop all advertising aimed at children under 12 years old:

While the company had a policy in place that prohibited any advertising to children under six, and called for any advertising to children 6-11 to meet specific nutritional criteria, the new policy will go even further. According to Mondelez’ website:

We decided to further strengthen our Marketing to Children Policy. Starting January 1, 2016 we will no longer advertise our products directly to children under age 12, irrespective of the product’s nutritional profile. We will focus all advertising efforts towards the parents and adults, giving them information and choices to help make mindful snacking decisions for themselves and their families. Our brands are in the process of transitioning their marketing campaigns.

Boy howdy, the global sigh of relief rushes at me like the sound of a whirlwind. However, the ICCR and BCAM busy-bodies aren’t quite finished preening:

ICCR members have been in dialogue with the company, advocating for stricter policies that will shield kids in the 6-11 age group from direct ads for snack foods and products that may compromise children’s nutrition. Child-directed advertising for snack foods, sugary drinks and other unhealthy foods has been linked to the epidemic of childhood obesity, as children are considered especially vulnerable to these advertising messages.
The shareholders believe the new policy sets the industry standard for responsible marketing to youth that will result in healthier food choices for children and importantly, establishes a model for other food companies to follow.

Said Lauren Compere of Boston Common Asset Management, “Mondelez has shown us that it understands the risks some of these products pose for children’s health and is putting the right safeguards in place to ensure that children aren’t being directly targeted with ads that feature the ‘junk foods’ known to cause obesity and other health problems.”

Readers will note the weasely text of Mondelez – “irrespective of the nutritional profile” – and ICCR’s claim a link exists between advertising and childhood obesity that might “compromise children’s nutrition.” Good grief, and too bad Mondelez found it necessary to cave to ICCR and BCAM hooey at the expense of shareholders who reasonably expect a major international company to put them first rather than wasting time and precious corporate resources on such silliness.

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  • I. A. Swit

    I don’t understand why a company should care more about shareholders than actual CONSUMERS. If sugary void-of-nutrional-value food is actually bad for children (and the type2 diabetes problem in this country is proof of that) then why is it a bad thing they chose to listen to advocates of nutrition and stop putting bad ideas in kids’ heads? Maybe shareholders should be on the side of company that promotes societal well-being instead of whatever company can fill their own coffers at the expense of young children. Mondelez is an example of a company that is so concerned with their shareholders that they don’t take their consumers into account. That doesn’t sound like a concept Acton should be promoting.

    • BruceEdwardWalker

      Perhaps you missed the part where I wrote Mondelez actually caved to the desires of the activists. Their consumers have choices, so what else is there for the company to take into account as regards its consumers? Last time I checked, it’s parents who control household purse strings, not children who only are able to request a parental purchase based upon what they saw advertised on television. Or are you saying companies that have provided investment returns for shareholders in the past should change their entire business model to accommodate the whims of activists thereby risking shareholder returns in the future? Perhaps they could only manufacture and bring to market nothing but rice cakes?

      • I. A. Swit

        I don’t understand why caving to activists is such a bad thing, until you explain how it would be more harmful than less – in terms of what’s right by consumers. I don’t buy “whatever gets shareholders money!” Argument because you can make any immoral claim. I believe Acton upholds moral decisions, even in a free market (or do you think prostitution, drugs, and all other immoral activity should be legal because shareholders?)

        You say parents make the buying decisions – then explain to me why Mondelez should keep advertising to people who don’t make buying decisions? If anything, the company is now doing what they should have been all along.

        If the government made a decree forcing this company to start selling brown rice cakes I’d be against it for probably reasons you’d also be opposed. However, activists come in all shapes and sizes. A free society will have activists, and that’s sometimes a good thing. If you don’t agree with this particular set of activists, why? The outcome is a good one by mora standards and no use of force was implemented. If you have a problem with activism in general, then I would reconsider writing as an activist on this blog, because that’s all nonprofits like this are anyway (which I think is perfectly fine).

        And to one further point, companies should absolutely change their entire business model from time to time – it’s called creative destruction. And in this case, the activists were on the right side of the issue. no investment is a guarantee, it’s always full of risk. Especially when you’re pursuing ethical buying choices and not manipulating young kids. Shareholders have a responsibility to the company after all.

        • BruceEdwardWalker

          You’ve gone off the deep-end. There are shareholders in the human-trafficking and illicit drug arena? News to me. To your second graf: Easy, because parents sometimes ask their children what they’d like them to purchase for their enjoyment preferences. You don’t like the idea Oreos marketed to children with a catchy little jingle (and, trust me, it was indeed catchy), but advertising is how products break through the competition and clutter currently on the market. You indicate you agree with the Bernie Sanders of the world that there’s too many consumer choices, and a minority should dictate whether delicious cookies should be on the market in the first place. I disagree. Yes, a free society will have activists. Nothing wrong with that. There’s also nothing wrong with disagreeing with them for reasons I’ve been expressing for nearly two years in this space — because it turns shareholder meetings into an activist circus, which depletes resources and threatens a company’s bottom line and therefore returns for fellow shareholders. To your final graf, I don’t think you understand what Schumpeter meant by creative destruction. In fact, I’m quite certain you don’t understand. Buying cookies is now “an ethical buying choice”? Good grief. Informing children (manipulating is such a manipulative word, no? Caught ya!) of cookie choices so that they can offer an opinion when parents ask them what they’d like the parents to purchase doesn’t carry with it the ethical weight that you grant it.