Executive Q&A: Yum Brands' Jonathan Blum Wants More Menu Labeling
The restaurant-chain executive gripes menu labeling language in the health-care reform bill in the House is unfair to large players.
By David Farkas, Senior Editor -- Chain Leader, 7/24/2009 10:08:00 AM
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| Jonathon Blum, senior vice president and chief public affairs officer at Yum Brands. |
Yum Brands is the largest of several restaurant companies that signed a letter asking for revisions to Section 325 of the H.R. 3200, otherwise known as America's Affordable Health Choices Act. They contend the section, which sets forth menu labeling rules, treats them unfairly.
In a July 17 letter to the House Committee on Energy & Commerce, where the bill is in markup, the 21 chains insisted Section 325, as written, will "exempt more than 75 percent of the restaurants in the U.S." from having to post caloric information on menu boards.
That's because the bill requires only chains with 20 or more restaurants nationally to put caloric and other nutritional on menu boards. Chain Leader discussed the issue with the letter's author, Jonathan Blum, senior vice president and chief public affairs officer at Yum Brands, parent company of five of the participating restaurant chains: Taco Bell, Kentucky Fried Chicken, Pizza Hut, Long John Silver's and A&W All American Food.
What's wrong with the language in the health-care reform bill as it now stands?
First, keep in mind, we, Yum, voluntarily, on October 1, 2008, said we will place calories on our menu board in 2011. We are the first company in the nation to do this voluntarily. We also called for federal legislation to clean up the patchworks and establish uniformity.
Are you referring to the LEAN and MEAL Acts, which also call for that?
No. On October 1, 2008, we said there ought to be federal legislation using California as a model to establish uniformity in menu-board labeling. We thought the California bill [effective July 1] was the good model. Yet, in our opinion, it didn't go far enough, because it didn't encompass enough restaurants or supermarkets or convenience stores. That is where [Section 325] language today doesn't go far enough. Our view nonetheless is that we absolutely need federal pre-emption legislation.
So you like the bill?
The bill in our opinion is very good insofar as it would clean up the patchwork of regulations. What it needs to do is go beyond chains of 20 or more restaurants.
Explain your reasoning.
There are 945,000 restaurants in the United States. Only 24.4 percent are chains of 20 or more [units]. That means over 75 percent of restaurants in America would not be educating consumers with calorie information. Consumers use calories as proxy for their purchase decisions. They do want this information, and it is up to them to do what they want with it. The vast majority think menu labeling ought to be in all restaurants.
Why did Yum and other companies decide to live with menu labeling? In fact, why didn't the industry stop it when it first popped up?
Let's back up first. Over the last three or four years, we've seen a patchwork of local, county and state regulations pop up in different jurisdictions. Each one had a different flavor and requirement for presenting that calorie information. Some required more nutritional information than others. The industry wanted to make this information available, including Yum. But we wanted the flexibility to do it in our own way--with posters, brochures and Web sites.
| Update: Menu Labeling in the House of Representatives |
| * Section 325 included in health-care reform bill being considered in House Energy & Commerce Committee when was it was introduced July 14, 2009 * Markup still underway in that committee * Broader negotiations on health care have slowed markup, but likely to be completed before August recess * Prospects for floor action before August recess uncertain, but more likely than in the Senate Source: Yum Brands |
Those efforts go back more than a few years.
Yes, they do. But that was the industry's answer to the call for nutrition information being made available by special interest groups and the regulators. But those efforts didn't satisfy the special interest groups [like Center for Science in the Public Interest] and regulators.
Does that mean a concerted approach by special interest groups aligned against the industry can change public opinion?
They certainly help shape it. And in our case, the industry helped balance out this issue. But it was the health commissioners in counties, cities and states who advocated for nutritional labeling, prompted by special interests. But nonetheless they have recognized that obesity, diabetes and coronary heart disease is a problem. This is a much broader issue than food.. We have become much more a sedentary society.
Explain why menu labeling on a federal level ended up as part of the health-care reform.
I don't have any answer for that. The industry and proponents of [menu-labeling] legislation came to a compromise that they thought was acceptable. And yet, if you are rooted in public policy and what's in the consumers' best interest, [Section 325] is not serving consumers because 75 percent of America's restaurants would not be providing this information. Therefore, the threshold needs to change. It must be lowered to, say, 3 or more restaurants with at least a million in [annual] revenue. It would be in the best interest of consumers and still not be punitive to small mom-and-pop restaurants.
