Erste Asset Management Investment Blog

“Less is better” vs. “Drink responsibly”

“Less is better” vs. “Drink responsibly”
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Interview with Dr. Alfred Uhl, “Competence Centre Addiction“ of Gesundheit Österreich and Sigmund Freud University

What sort of responsibility do alcohol producers hold?

The UN General Assembly has deemed the economy crucially important in the fight against noncommunicable diseases such as addiction. This requires a situation where one does not categorically reject financial support from the industry aimed at curtailing the problem through research, preventive measures, and the treatment of people suffering from alcoholism; that being said, one has to make sure that this is not done in a way that contradicts the intention of reducing the problem.

There are two political camps in society with regard to alcohol: one thinks that it is generally a questionable product, while the other one regards the moderate consumption of alcohol as stimulant as positive and sees only excessive consumption as serious issue. The industry finds itself between a rock and a hard place, trying to cater to the interest of several parties. As in other areas, some players are very keen on a good reputation and responsible business practices, whereas others only look at the bottom line.

What’s your take on the status quo?

Tensions come up wherever the fight is about basic definitions and attitudes. In Northern Europe, the popular slogan is “less is better”, while in the South “drink responsibly” is the common ground. In the South, the consensus is that moderate consumption is no problem, whereas in the North the attitude is slightly more alcohol-adverse.

The two political and societal tendencies represent one underlying stance. Basically, demands are for the industry to promote prevention, therapy, and independent research. At the same time, the funding by the alcoholic beverage sector is seen critically. Demanding activities to reduce the problem on the one hand while rejecting them categorically on the other hand does not really make sense.

To what extent should the state intervene (laws, information campaign, taxation)?

The prevention and curtailment of problems associated with alcohol is of course an important task of the state. In this context, we have seen numerous public actions financed and legal amendments passed in recent years – both aimed at cutting problems resulting from alcohol abuse. For example, traffic campaigns have been funded and the DUI laws have been gradually expanded (intoxication thresholds, police checks without suspicion etc.). Addiction prevention and therapy are funded publicly, with excessive alcohol consumption consistently expounded.

In the past we have often seen changes towards reducing the problem such as by way of trade regulations, where the explicit authorisation of selling alcohol to children if they claim they are buying it for their parents was scratched. It is nowadays impossible to imagine children legally buying alcohol for their parents. This is definitely an achievement by politics.

The awareness that excessive alcohol consumption may be a health scare and that it also causes a number of other problems has increased. However, fundamental changes such as a healthier way of handling alcohol do not happen overnight. Basic attitudes and cultural imprints shift only gradually. For example, alcohol consumption has decreased by about a fifth since 1971. At the same time, one has to admit that excessive alcohol consumption and alcohol dependence remain a big problem in Austria.

How does Austria fare in comparison with other EU countries?

There are different ways to approach the problem politically. North European and English-speaking countries are generally in favour of a strict alcohol policy, pursue a premium-price strategy, and try to curb the availability of alcohol altogether. This approach is somewhat alien to many countries, among them Austria.

While high prices and strongly limited opening hours can reduce average consumption, they also abet excessive behavioural patterns, as a comparison of Northern Europe and the catholic South illustrates. In Northern Europe, more people do not drink alcohol at all, and those who do drink, do so less frequently. But when they do, they mean business. This leads to excessive levels of intoxication despite the fact that average consumption is lower than in the Southern parts of Europe.

 

Read more articles from this issue of our ESG letter here.

*ESG stands for Environmental, Social and Governance“ – These are the three broad categories according to which companies are examined in sustainable investment.

 

Legal note:
Prognoses are no reliable indicator for future performance.

DOSSIER

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