Diageo chief calls for US industry action

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Related tags: Alcoholic beverage

Beverage producers, wholesalers and retailers should join forces
with their respective industry associations to present a united
front on the issues of responsible drinking and taxation, says Paul
Clinton, head of Diageo's US operations.

Paul Clinton, head of the US operations of giant UK spirits group Diageo, has called on all the players in the wine, beer and spirit industry in North America to join forces to take action on issues such as taxation and social responsibility.

Speaking at a meeting of the National Beer Wholesalers Association (NBWA), Clinton said he had organised a summit for the spring of next year which would allow all the leading players in the US beverage alcohol industry to discuss matters of interest.

"Everyone in the industry deeply believes in and practises social responsibility. Everyone in the industry deeply believes that taxes on all our products are already unreasonably high. I propose that the entire industry come together next spring in an all-industry summit to address just two topics: gaining better awareness and appreciation of our joint commitment to the responsible use of our products and working to prevent taxes on any of our products from being raised,"​ Clinton said.

He suggested that the summit include not only producers of wine, beer and spirits but also wholesalers and retailers and the industry associations that represent them, and added that there had been a considerable amount of support for the proposed summit already.

The NBWA has already pledged to attend, and Clinton said that he would seek the support of other organisations such as the Beer Institute, the Distilled Spirits Council of the US (DISCUS), the Wine Institute, American Wineries, Wine and Spirits Wholesalers of America, American Beverage Licensees and the American Beverage Institute.

The drinks industry has traditionally been none too keen to speak with one voice, with rivalries between companies tending to take precedence over any thought of collaboration, but Clinton suggested that much more could be achieved if firms agreed to bury their differences and act together, at least on key issues affecting all of them.

"Americans and American policymakers need to better understand and appreciate the major commitment we all make to the responsible use of our products,"​ Clinton said."Efforts from the beer, wine and spirits segments are showing results, both in terms of greater awareness of the problems associated with underage drinking and misuse of beverage alcohol and in terms of a decline in drunken driving incidents. We are committed to continuing to be a part of the solution to these problems."

He stressed that only by collectively arguing their cause would the drinks industry be able to bring about a policy change on taxation. "The beverage alcohol is among the most heavily taxed of all consumer products and it is to the benefit of the entire industry - and consumers - to come together to prevent further increases in beverage alcohol taxes, which already account for more than half the price consumers pay,"​ he said.

There are already cases of the industry working together elsewhere in the world to help tackle problems affecting the drinks trade. Diageo is one of the key members of the Portman Group, an association formed by most of the leading drinks groups in the UK to voluntarily tackle issues such as the labelling of drinks - in particular alcopops and other ready-to-drink products which could be appealing to children - and the sale of alcohol to underage drinkers.

Although it is a voluntary organisation, the Portman Group has achieved some success in the UK, and it operates with considerable autonomy from the drinks groups which essentially pay for its work, giving it much more credibility as an industry watchdog. Whether Clinton is thinking of something on this scale - and the Portman Group does not tend to get involved in issues relating to taxation in any case - remains to be seen, as does whether the US industry is as ready to work together in the long term.

Related topics: Markets, Diageo

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