Political groups representing the United States' largest food and beverage companies are donating far less money during the current election cycle to Republican and Democrats, while also curtailing how much they give to industry trade organizations that lobby on their behalf, according to data compiled by the Center for Responsive Politics.
A review of contributions by 10 of the largest food and beverage companies by revenue to congressional lawmakers and political action committees, or PACs — groups organized to raise and spend money to elect and defeat candidates — showed through Sept. 21 that donations to Democrats fell 30% to $828,300 while those collected by Republicans declined 52% to $876,700 compared to the 2016 election cycle.
Much of the drop for both parties was tied to sharp declines in donations from Coca-Cola, PepsiCo and AB InBev's U.S. division, Anheuser-Busch. The companies reviewed by Food Dive are headquartered in the U.S. or were based here prior to an acquisition by a foreign business. General Mills was removed from the list because it did not have donation data for 2016 and 2020.
At the same time, PACs representing organizations such as the American Beverage Association, Grocery Manufacturers Association (since renamed the Consumer Brands Association), the National Restaurant Association and the Beer Institute collectively saw contributions plunge nearly 50%. Overall, trade group-related PACs received $64,500 compared to $124,000 four years ago.
Political donations from food and beverage corporations drop in 2020
"You want to continue being a big strong company making money for your shareholders, your employees and bring good products to the market. You don't want to be bogged down with the outside nonsense," said Jon Schaff, a professor of political science at Northern State University in Aberdeen, South Dakota.
"If anything, you're to be very conservative in a nonpolitical sense, conservative with your money and there is no reason to get involved in this or that particular dogfight as we've gotten more partisan and things have gotten quite bitter. Maybe it's best to just let this election go," Schaff said.
While the declines could be from the heated political climate, some may potentially be attributed to a slightly shorter period during the 2020 election cycle so far, with data covering only until late September. The donation numbers for the election four years ago cover the full 24-month period ended Dec. 31, 2016.
Under the radar
CPG companies contacted by Food Dive said PAC donations are one tool they use to help candidates and advocate for issues important to their businesses or industries. Kraft Heinz is one of the few companies to see an uptick in donations, doubling its contributions to Democratic PACs and candidates in 2020 to $80,500 compared to $40,500 in 2016. Republicans received $71,000, down slightly from four years ago, while trade group money fell to zero in 2020 from $19,000.
“As a small PAC we contribute to the party committees in small amounts to allow them to support the candidates they believe need the most help," Lynne Galia, a Kraft Heinz spokeswoman. "Our PAC is not a 'majority' PAC so we strive to give in parity, particularly to party committees.”
Anheuser-Busch, one of the biggest overall donors to PACs and lawmakers among food and beverage companies, along with Coca-Cola, sharply cut contributions from its PAC to Democrats by nearly $100,000 to $305,000, while Republicans received 55% less at $249,500 versus 2016. Industry PAC donations fell to $5,000 from $10,000.
A statement provided by Anheuser-Busch said its PAC is one way they "engage in direct advocacy on behalf of the critical business issues facing our employees and our company at the federal and state levels. The AB-PAC supports elected officials and candidates for office whose policy positions and objectives support our company’s license to operate."
Coca-Cola, the world's largest nonalcoholic beverage company posted the sharpest declines in its donations among the companies reviewed, with contributions to Democrats, Republicans and trade groups sharply lower compared to 2016. Collectively, the maker of Diet Coke and Honest Tea donated $382,000 in the 2020 election period, a drop of close to $600,000.
Coca-Cola directed inquiries about its contributions to its website where it noted that donations to candidates and trade groups are two of the ways they engage in political issues. "We consider it our duty, and our responsibility, to make our views clear to those who have the potential to impact the laws, regulations and policies that can influence our global business," the company said.
While the data reviewed by Food Dive using the Center for Responsive Politics' OpenSecrets database doesn't represent all food or beverage companies in the space, it does exhibit a pattern showing businesses increasingly don't want to risk connecting themselves to a political candidate over fears it will adversely affect their company or brands.
Contributions by company in 2020 compared to 2016
Juda Engelmayer, president of HeraldPR who has clients in the food, entertainment and hospitality sectors, said companies that traditionally have given money to political candidates in the past have either not been doing it or are finding other ways to contribute, such as encouraging friends, colleagues and family members to donate to PACs that have different reporting periods.
"I'd rather do it quietly because I don't need to be beaten up for it," Engelmayer said of these companies. "There are a lot of people — more than you know — that are very, very anxious about that."
Corporate PACs could instead decide to shift their donations to industry groups that could use the money to support candidates or lobby for issues on their behalf, such as trade and tariffs. Those donations are down this year partly because food and beverage companies have fewer major issues they need to worry about beyond the pandemic, Schaff said. Businesses also are spending more time watching their bottom line during the outbreak and preparing for an uncertain economic future as the coronavirus continues to pummel the global economy. As a result, it makes more sense for PACs to hold on to their cash.
Social media's growing impact
Political analysts said corporations increasingly are susceptible to blowback from consumers on Twitter, Facebook and other social media platforms. If individuals oppose a company's stance on an issue, a donation it has made or its association with a specific politician, these platforms can be used to encourage shoppers to boycott their products or simply bring bad press.
"Social media makes it possible for advocacy organizations to punish opponents for political actions and negative news travels faster and farther than PR departments can keep up," Betty Smith, a retired political science professor at the University of South Dakota, said in an email. "The more a corporation can distance itself from its donations, the safer they are in the current divisive atmosphere."
Earlier this summer, Goya was called out when its CEO Robert Unanue praised President Donald Trump in a speech at the White House. Thousands of people on social media called for shoppers to stop buying from the company. The phrase #BoycottGoya quickly started trending. Two months later, Oatly came under fire from activists and consumers threatened boycotts after the company signed a $200 million deal in July that included an investment from private equity firm Blackstone Growth, headed by a major Trump donor.
In 2018, Nathan's Famous was threatened with a boycott after Executive Chairman Howard Lorber held a fundraiser for the president. A year earlier, companies including Hershey, Mars and Jelly Belly were targeted because the National Confectioners Association hosted its annual conference at the Trump National Doral Resort.
With potential criticism ever-present, CEOs at major food companies appear to have largely eschewed donations to presidential candidates. Of the largest companies, only Steven Williams, CEO of PepsiCo Foods North America, donated money to former Vice President Joe Biden when he gave $2,000 to the Biden Victory Fund in June.
Williams oversees PepsiCo brands such as Doritos and Quaker Oats. He reports to PepsiCo CEO Ramon Laguarta. Anheuser-Busch's PAC donated $20,000 to Hillary Clinton in 2016, but records show the beer giant hasn't made any contributions to presidential candidates during the current cycle.
"What you are seeing is few companies risking their brands being called out. The whole atmosphere has caused people to go underground and not be seen."
Juda Engelmayer
President, HeraldPR
Nearly all major U.S.-based food and beverage companies operate their own corporate PACs. For executives, this could be a more attractive way to donate money to a political cause or candidate because the money gets pooled together with other donations, political analysts said. It's harder for the money a PAC donates to a presidential candidate, for example, to be traced to a specific individual.
Executives hesitant to put themselves out there publicly also could have a family member donate on their behalf, and while it's not impossible to tie the donation to that individual, it takes more time and political savvy by the prospective sleuth to dig up the information.
"What you are seeing is few companies risking their brands being called out," Engelmayer said. "The whole atmosphere has caused people to go underground and not be seen."
