ALCOHOL INDUSTRY

Who is the alcohol industry? Who are the actors that make up Big Alcohol? We are mapping the alcohol industry and revealing the fundamental conflict between the private profit interests of the alcohol industry and the people’s interest in thriving communities and healthier societies.

2.6 millionDeathIn 2019, alcohol caused 2.6 million deaths globally which is 4.7% of all deaths.

Who belongs to Big Alcohol?

Alcohol producers, alcohol distributors, alcohol retailers, and alcohol marketers are the core of the alcohol industry. But they are not all who make up Big Alcohol.

Alcohol companies also have front groups they deploy to promote and protect the profit making interests but disguise who is behind them and in this way alcohol companies try to protect their reputation. So called SAPROs (~~Social Aspects~~ and Public Relations Organizations) are also part of Big Alcohol. The name is misleading though because there is nothing “social” about these front groups. They are PR and profit maximization groups for the largest alcohol producers in the world.

But that is also not all: Big Alcohol is even bigger. All actors that protect and advance the private profit interest of alcohol companies belong to the web of the alcohol industry. This includes:

trade groups,
astro turf groups,
some media agencies,
some scientists and scientific institutions,
some elected official and regulatory agencies,
some advertising agencies and law firms,
some banks and other financial institutions,
other global corporations in the corporate consumption complex,
some think tanks,
some foundations and philanthropists, and
some lobbying firms.

Profit maximization and conflict of interest in the alcohol industry

The alcohol industry has a fundamental, direct, and inherent conflict of interest when it comes to people’s health and societies’ development.
Movendi International has compiled more than 120 concrete cases of conflict of interest in the alcohol industry

This conflict of interest consists of three elements:

Fiduciary duty to maximize profits
Undermining public health policies
Promoting heavy alcohol use and alcohol use of minors

8thMost profitableData from 2019 shows that the alcohol industry is the eighthmost profitable sector of 94 global industries assessed. They are less profitable than tobacco (number 3) but significantly more profitable for instance than soft drinks (number 40).

Fiduciary duty to maximize profits

Alcohol companies have a fiduciary duty to maximize profits. By law they must maximize sales and revenues to drive up profits.

But people’s health and societies’ development thrive when alcohol consumption goes down, because then alcohol harm and costs decline.

Molson Coors is one of the largest alcohol companies in the world. In 2022 they revealed their profit maximization agenda and how it conflicts with the public interest in reducing alcohol use, harm, and costs in their annual report.

In particular, advocates of […] severe restrictions on the marketing and sales of alcohol are becoming increasingly organized and coordinated on a global basis, seeking to impose laws or regulations or to bring actions against us, to substantially curtail the consumption of alcohol, including beer, in developed and developing markets. To the extent such views gain traction […] they could have a material adverse effect on our business and financial results.”
Molson Coors Annual Report 2022

Undermining public health policies

On the one hand, alcohol companies do all they can to drive up alcohol sales and consumption. For example, they invest billions in alcohol marketing.

On the other hand, they also interfere against initiatives to develop and implement policy solutions that seek to protect people from alcohol harm, such as raising alcohol taxes, banning alcohol advertising, and reducing the number and density of alcohol outlets.

The wine industry was exposed for their strategy to undermine public health policy, concretely proper alcohol taxation in Europe:

One of the threats to the wine industry is its inclusion with beer and spirits, [and] in the same taxation structure as beer and spirits. Governments will inevitably see the redistribution of consumption and the consolidation of wine at 40% of the alcohol market as a major source of taxation revenue.”
Tony Spawton, Development in the Global Alcohol Drinks Industry and its Implications for the Future Marketing of Wine, 1990

Twenty years later, wine is still not properly taxed even though prevalence of wine consumption is very high, according the research.

132 906Lives can be saved by improving alcohol taxationThe NCD Advisory Council’s signature initiative working group found that 132,906 lives can be saved every year if European countries introduce a minimum level of 15% tax on the retail price per unit of alcohol, regardless of the type of alcoholic beverage.

€420Major Return from Alcohol Tax IncreaseLithuania’s 2017 tax increase lowered alcohol deaths by 22% and boosted revenue by 38%, yielding €420 in economic benefits for every €1 invested.

The strategy of the wine industry, deployed deliberately since the 1990s, to avoid, block, and derail proper wine taxes in the interest of people’s health has massive and severe consequences for people and societies.

And there is a third element to the alcohol industry’s fundamental conflict of interest: how much Big Alcohol needs heavy alcohol use and alcohol consumption by minors for their profits.

Promoting heavy alcohol use and alcohol use of minors

Movendi International has compiled compelling f i g u r e s that reveals how dependent alcohol companies are on heavy alcohol use for large parts of their profits.

Already in 2003, a comprehensive study showed that under-age alcohol users and adult heavy alcohol users in the U.S. were responsible for 50.1% of alcohol use and 48.9% of consumer expenditure.
In higher income countries heavier alcohol consumption occasions make up approximately 50% of alcohol sales.
76% of alcohol sales in middle-income countries are resulting from alcohol consumption in excess of the WHO definition for heavy episodic alcohol intake.

In 2021, a landmark study revealed that despite what Big Alcohol claims about their commitment to reducing under-age alcohol use, the alcohol industry has made $17.5 billion in sales revenue (in 2016) from alcohol sales to minors in the United States (U.S.) alone.

In 2016, the alcohol industry earned $17.5 billion or 8.6% of their sales revenue from alcohol sold to under-age adolescents in the United States. Three major alcohol companies AB Inbev, Molson Coors (then MillerCoors) and Diageo have made almost half (45%) of these profits.

AB InBev is responsible for 21% – amounting to $2.2 billion of these sales,
Molson Coors – which was called MillerCoors until 2019 – is responsible for 12.3% of the under-age market share amounting to $1.1 billion in sales revenue, and
Diageo accounted for 11.1% of the alcohol market share for minors, taking in an estimated $2 billion in sales revenue.

$17.5 billionEarning from minorsIn 2016, the alcohol industry earned $17.5 billion of their sales revenue from alcohol sold to under-age adolescents in the United States.

There is a clear disconnect when an industry advocates prevention, but then makes billions from prevention’s failure […] The alcohol industry has said they don’t want minors to [consume alcohol], but when we counted up the [alcoholic beverages], it was clear that they were making billions of dollars from these sales,” said Dr. Pamela Trangenstein, lead study author and assistant professor of health behavior at the UNC Gillings School of Global Public Health, as per UNC Gillings School News.
Dr. Pamela Trangenstein, lead study author, assistant professor of health behavior, UNC Gillings School of Global Public Health

THE DUBIOUS FIVE

Exposing alcohol industry strategies is the key step towards countering them.
The Dubious Five outlines the five key ways the alcohol industry sabotages, manipulates, deceives, normalizes and promotes alcohol, and undermines policies that reduce alcohol use and save lives.