A Krafty Move

The lead story in today’s Wall Street Journal chronicles a neat little morality play on corporate responsibility and the power of the free market. 1

Faced with the twin specters of childhood obesity and possible government regulation of children’s advertising, Kraft Foods, Inc. announced in January that it would stop advertising certain products to children under the age of 12.

To be sure, this is not a perfect solution. The company, which makes such teeth-rotting, waistline-expanding and nutritionally-challenged fare as Oreo and Chips Ahoy! cookies, Fruity Pebbles and Honeycomb cereals, and Kool-Aid drinks made exceptions to its self-imposed ban. For example, it continues to market its sugary and caloric Capri-Sun Sport drink to children, making it sound like Gatorade for youngsters.

Still, it seems that Kraft learned a lesson from the travails of its corporate sibling, Philip Morris USA. Philip Morris, of course, denied the health effects of tobacco for years. Then it lost its landmark $200 billion lawsuit in 1998. Now it is in favor of government regulation of the industry, which is opposed by other tobacco companies.

Kraft is in a similar bind. Its competitor, General Mills, Inc., continues to market its Trix and Lucky Charms cereals to this young demographic, unburdened by any sense of shame or fear of a tarnished reputation.

Despite its imperfection, Kraft is to be applauded for its decision. What’s more, Kraft took this step without being forced into it by government regulation. Therein lies the moral: In the end, it is up to individual companies and industries to understand what’s right and what’s wrong. They may be pleasantly surprised to find out that it is good business, too.

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