Philip Morris
Philip Morris Incorporated 840000 Corporate Affairs World Conference Rye Brook, New York 840913 Directly: in the Legislatures & Government Bureaus
Fields
- Author
- Breedlove, J.
- Bull, S.
- Covington, M.
- Hunt, R.
- Irish, M.
- Klemp, R.
- Nelson, J.
- Vonmaerestetter, C.
- Bull, S.
- Type
- TRAN, TRANSCRIPT
- LIST, LIST
- Area
- CORPORATE AFFAIRS/CARLSTADT
- Site
- N100
- Named Organization
- 5th World Conference on Smoking + Health
- Alcohol + Drug Problem Assn
- American Council on Alcoholism
- Batf, Bureau of Alcohol,Tobacco and Firearms
- Board Officers of Field Pac
- Cannon Mills
- Coca Cola
- European Commission
- European Economic Community
- European Parliament
- Evelyn Wood Speed Speaking School
- FDA, Food and Drug Administration
- Federal Express
- Foreign Investment Review Action Agency
- French Parliament
- Ftc, Federal Trade Commission
- Health Education Foundation
- Ma State Legislature
- Mcclain
- Miller Brewing
- Nas, Natl Academy of Sciences
- Natl Assn of Sports Assn
- Natl Assn of State Boards of Education
- Natl Conference of State Legislatures
- Nla
- Ny State Lobbying Commission
- Pepsi
- Poison Squad
- TI, Tobacco Inst
- Uk Parliament
- US Brewers Assn
- US Congress
- US Senate
- Usda, U.S. Dept of Agriculture
- Washington Post
- Wolfgang Arnold
- 1984 Corporate Affairs World Conference
- Alcohol + Drug Problem Assn
- Request
- Stmn/R1-006
- Stmn/R1-020
- Named Person
- B, A.
- Boland, J.
- Breedlove, J.
- Brown, W.
- Buccellato, V.
- Bulger, W.
- Bull, S.
- Covington, M.
- Cullman, H.
- Cuomo
- Delaney, J.
- Flanagan, G.
- Grannis
- Haley, M.
- Hunt, R.
- Irish, M.
- Johnson, H.
- Klemp, R.
- Marisfeld, T.
- Mazingo, R.
- Milman, A.
- Nelson, J.
- Pittman
- Sargent, E.
- Scott, S.
- Vonmaerestetter, C.
- Weismann, G.
- Wiley
- Xxandrew
- Xxbernie
- Xxemily
- Boland, J.
- Master ID
- 2025421657/2239
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- Author (Organization)
- 7 Up
- Litigation
- Stmn/Produced
- Date Loaded
- 05 Jun 1998
- Brand
- Virginia Slims
- UCSF Legacy ID
- xgd34e00
Document Images
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1 PXIZ3P NORRIS IDCORPMTaD
1984 CORpOBIATE Ag!?1IRS WORLD COWUMH
2 R?II SR0W NNi1 YOAIC
SEFTMBBR 13, 19®4
3 DIRICTLYs IN iU LEOISLA?" a ©OVERDM:BT 'UMUS
4 TI'1'ti$, SBraEER..
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5 CE3nD'?3RIXED R*S.OLtRCaS ,
Jim sBLSOg............... 2
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I COIWUSIOH OVER SWBB'PXaR8
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N ROBER'P StJ1111' ............... 10
7 MAJOR LE®ISLATIVS
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~ PRO82.8NS KhY COVIII>WOllr............ 17
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PILOT PROf3RAM. XICHAEL IRISB ............. 25
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~ ADVBRTISI]ftG BADi ON
10 ~ BRNNINi COMPAMBS RICHARD XiENP ............. 30
11 ~1 Ct1MPliRIlliA CAL+UIDAS
5~ LBt3xsIATIVS ISSUES
12 COMPARED TO U. S.& mROPR
z CYWfHIA vOx MAZRZSTaTT$R.. 3s
13 ~ LRdISIATIVE AND
H RFS3ULATORY VALUES
~ JAMES BREEDLOVB........... 44
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CLOSING REb1ARKS STEPSSS.BULL .............. 52
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1 lKMdPAT'!d 8?8VNBB DMLs =! I can have your
2 attention here I think we' ll qat started. We're only about
3 2~ miadtes behiad so .r.'re goin9 to ls;ve to make up so.a
4 time. This workshop is entitled, Dealing witb the 206044
5 Directly, In th. Legislatares and dasrn..at ftteaas, and
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6SO? it has been des igned for ur to Snarrwase oqr mWarstanding
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7 ~ of the legislative and regulatory issaes eAsl2saqing tb.
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8 o cospany and its iAftstries Iato the strategies ewplay.d to
9 o meet these chaiiessges. We bope that it vrii`l be instructive
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10 ~ a Ad entertaining for all of qs In as onch as it should be
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11 ~ reflective of tbe various issues on which the representatives
12 En from virtually all the op.rating aoaPanies are and have been
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13 ~, working and should give us an indisation perhaps of bow we
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14 ~i stiobt deal with similar or disparit issues as we discussed
15 ~ in the previous session.
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16 z There will be a total of seven presentations
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17 p ali, each of which wiil be limited to ten minutes. 8.ily
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18 a just gave me strict instructions that we will indeed adhere
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19 O to the schedule in one way or another we'll be out of bere
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~ by 12:45. In addition to the light Rroheler digita2 eYock
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21 ~ which I'm supposed to focus upon during each presentation
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I've been told it says, times up. So we will begin, I will
introduce individuals as we go along. I thought originally
I migbt introduce each presenter at the beginning bowever,
doing it as we go along provides the opportunity not only to
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law. WbI1ip Morris. V.8.AO .fio will describe the ooepytrtsis+rd
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. ring the b.11l but to isterrapt by just introdoviuq the
xast person.
ftr - fiT#ft presentarlcion is es. J&dh Nexso®.
140 is saoaqer of Public Altt.ir. #ft research and analysis
resoatzeese available Isbxo"% aNi, M, tihe track iegisiation.
DR. 0 OW pAi,dalts 'lhank you Bteve. I want to
talk a little bit before I talk about what wr've done at
PM-EtBA, about wbhat ressaxelk is supposed to do in Public
Affairs. I think it has four elesents, one is collection of
inlorsstion about political acctivilty, legislation. I think
that research had four eleen.ats, the colleation of information
about political activity, legislation and regulations rela.--<
I tive to the ceeepany's business. The analysis for senior
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aaanagemnt of this information in light of the interest of
the company. Tbe preservation of such information aall the
medium fresaahicb it is quickly and easily retrievabie and
the creation of persuasive arguments to articulate out peoti-
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0 tion once established by management in the political process.
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~ D1ow all these elements relate to the activities
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;; of P->ri's political operatives, what our po2itical, operatives
seek in their ekhanstinq taave'is and recepti.ons, dinners,ana
luncheons, is aspeQific occasion, an occasion on wfiicb to
speak to a decision mNker, to teli hi.s or her saAetblbg about
Philip morris, and when appropriate to tell thea somethinQ
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about Philip Morris, and w'Aea appr-opriate to teli tb.m
something about our issues. -
I think research can assist the operatives
in mrking this occasion aore productive to the ctorapany. We
: can discern the emerging iaaue in a given stat. or 1ocality
we can identify the key decision makers on that, issue, we
7 ~ can Qlarily the company's position, give the operative argu-.
8 0 >swnts for our decision. fte operative can then use. these
9 p arguments to, intiwnce that deeisiou saking, toucbing the
10 decision msker with tbe right information at the right tisw
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is critical. Merely to identity key decision xakers may
allow tbe operative to establish the contact for use rrliea our
a issue later arises or to plant some seeds which may there-
fore bear fruits later.
I think finally tbe ~research function can
store a record of the operatives contact with the decision
maker so when an issue does arise and we search for belp our
computer can teil us vlAor, we know and where. Now, (SLID88)
The probleaas° that we face in USA, nationwide
we work closely with the Tobacco Institute, and we do have
our own field oilioes. This is a rougA idea of how we're
arrayed out in the field.. 3,::8ow what we're working to do is
connect all these offices together with a oommanicratioos and
data system. It's wbat's called electronic mail. At present
TI has an electronic mail system ahich we're linked in so we
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bave all IOair o1liea0s on board row and the other oliicas iu .
4l40iA °:; and .tbe.plant stat«s will bft, on boaIcd by the .asd of
thfss yearr
what wr deal with h.ers is Ms :11 be able to
send virtua ily instautaaao<us mMVS: leqis Uti©o. lists,
oostacts, anything lsoa ow data base. a1e can take out
anything 1hst's been put in a word protssssor, wa can takf
out and W* can ship elaotremicaliy, nery ei!'icient and w
th.y can
can send it to somebody and edit it, they can send it badk
to you and all this can occur in a matter of an hour or so.
'
re pntting into
2n lact the syst~ that wa
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piace is really a generation abtad of the p.d.ral Upress
a taczsinile
ZAP Mail wbich is jnst about similar to this this is more
sophisticated than that.
we bave tAe data base, our data bases include
at present some 20,000 nasrsslo- tbeY're legislators and public
officials and other key contacts that w#ind it necessary
to deal with and have access to on a regular basis. Zt
large2.y contains names and addresses at this point we're N
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useful in the big hits that we ake with our products, with ~
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our products meaning thiaqs like the black, the hispanic guy, 0
23 pirqinia alims csa2en!lars, things that we reaeb out and show N
24 tben what* liie do, wake contact, make oltr names known to then.
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sae this is ont ai:ea0nt of it, developing an information system.
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'1".he seessfri4 leas>s<t of researctb. the seCOOd
elesnat of research lasation I gbink has to pay alcteetion
to is tAe NLA gmation. 'i'bat Is developing data bas.s and
inforaatioa that'a useful not only to senior sYaaagssrnt bat
to tbe aperatiws of understanding the issnes and being
abls to go out into the field aod deal with those isroai
and baeg able to go out into the field and deal with
those issues.
now bere is sss>te qrapbic illustrations of
what we do bave in our data base. This is a bar graph that
il.ltutrates what was 1983 status report, on the sa jor cate-
gortes of legislation in statea at tbe local lev.l. As ycm
can see the rrd Is past, the blue is pending, green is de-
feated and it go.s to each one of our issues, we can look
at this and see werY quickly that the problem we have at
the ioca 1 lev.1 is a problem of saoking wit©hing.
OkaY, this 3s a graph that a 1l.ne graph that
arrays price changes in cigarette industry over the past 10
or 11 ye:rs, it nses index numbers which is just a way of
creating all, making all things equal in and you have differ-
.nt values. What this shows politically is you can say, well
if you look at our price <hanges which Is manvtfaoturers list
price the line that goes to the very top e.alates very cios.ly
to tobacco prices tUoulboat the first part of the decade, the
yellow line, and then when they diverge you can see the surge
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tbat occurs Ia the exettaa aal*a tax which is tbe botter
1ima. It's a useful ilinstratlft = think gi,rren cnsr current
relations with the farr aoa.amity.
Xege's sss..tbiAg you can use with a ppablio
olfioiat, a3xi.ght, it's a high bar grapb. It illnstrates
wbo gets Vlott from the sale of cigarett.e packs tn xew York.
I lfelieerr vs put something like this in our Corporate Affairs
Report for the loard last year. And again, its clear the
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govsrtsreot gets the biggest s lie3., break out the govern.ent .:
shares with the bar graph and illustrate I think what aom
of the probists we face are in Diew York to the public offi-
cials. 47% of a dollar, that's a lot of cash flow makes us
very close to being tax collectors only in New York State,
and New York City.
Alright, this and the graph following it were
used in tbe battle over changes in the Federal Bxcise Tax
payaeAt period. This was prepared in order to illustrate
differential treatsient afforded cigarettes and other products
that are subject to excise tax. You can see the presentlaw
which is 13 days, the proposal I should say senate not state
proposal. Tbe senate proposal I believe was 1.5 days com-
pared to 75 days for tires, auto parts, telephones and air
tjW&. This ia something I think an operative woa].d use to
aaidb an equity largnment to government of f ittia 1.
D1ow this is somthing I think would beuselui
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to an ©p+ristiws to aw3esstand iawpact of every propwai,
e leotrobia funds tranr fer avd payment dates can be pretty:
esc>trria staff. »!at this dois is it takes all proposals
and reft+ees then current law, M is eleekronio funds trans-
f.rs 25 days which is the current length of time, eftbetive
isnqth of tisre for that. So 8tT in 20 days, no Ms 14 days
,~eezttoaabie.
I and the& final ly the Senate proposal which was the asMt ob- _
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know what wed like to see, what's store favorable alad what
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ie less favorable to then, and I believe Stew w+e'w got the
o Nc+r you don't hive to be a finance expert to
sTP and you got the same period.
Actually we're a little more efficient tha7h
the average manufacturer so that 1.5 day actually we still
get a half a day play . BTaw this plots and projects using
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a treoEd line regression which is a very si.ple analytic
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Average retail prices and &Vera9e st+rte taxdf°'
in the U.S. until 1999. Now what this is saying is this
t4~~i.q~ce.
is a way of looking at an issue, projecting it out and
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what's not going to b e such a big issue. And what this
indicates is that we've done a pretty effective job of keep-
ing state taxes down and if the trend continues in this vein
they will continue to drop as percent of retail price, and
vrhich ie of course a favorable trend. Now her.b an ad, as
~ saying, Wteat's going to be a big issue in the future and
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sOM Of Y" lllay IfGM/, yNterdaY lftl" bOQa1e the second st.atr
to attacb an e{0 imrease in 0. stat* tax to t1W smaet of
the lederal tax, the tederal tat #,s Uhat we would call aa
eytogenons sboft ahia'h possibly aasDtld throw this line all
askew.
ctassT,inoluding sales tax and add the more excise !.t any,
This is th. last MInsi . xow wbft I took
this from 0 chart that's prepared by $ve Sargest. M'i0 1s iR
Mary Cuviagton's group, whictD I was rea liy fapress+sd by and
in the EBC
+» used it to compare things that you can see. Their charts
look much different fresa ovucs in this first category. 1lasic-
ali,y it takes the State, the value added tax which in onr
the only one we have here is a line. The total proportional
does
tax, the specific excise for 20 that doesn't include the
Federal Excise tax, the average trade margin on retail price,
20 pack price for the popular category, I also put in Bnro-
peaa currency units because Ian did that and I thought that
was . Tax incidence which is percent of the retaii priaee
and tax. Our multiplier alhicb in this case is just the sea-
sitivity of retail prices to change and manufacturers prices
and then finally the total tax yield for 20 pack.
Now I think with this kind of model does for
you is you look at Aayaii, you see the very high multiplier
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what.tkat tells you, and wben you translate that into dol2ars
and cents is that a one dollar increase in manufacturers
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price .ight inarease retail pri+ose asn average dollars
eigbtees thro00eat tur aatioa aud whili !lawaii it would
imreasa then 03. 0.0 yb3dk tn one of the r.asoe! .by we
agpose added on tocatl,".
I tbinhr that #3ey cannot, res.ar+ak and astiol3i`
man't aeplac» qcod pOlihioal issttaCts and good Contafts but
tt can bap us be sox* elfacEiva a" give us an edge in in-
etreasingly hostile poiitical world.
NW»PAZOR 8. Bt1tL= Tltaek you very such Jaetk.
Rabert 8ant, is with as from 7 Up, Manager of pnblic Affairs
from 7 Up vhd will dese>vibo eertaia Federal reguiatory eftfusi,oa
over wetners.
ROBSRT i3tJ1~Ts Thank you Stevo. I wanted
to title my topic today, Bow Safeet It Is, but that's just
not the case when your talking about artificial swoztners,
as a matter of fact it's a very bitter lesson in the .rhdle
regulatory structure and leqis lature stsua3ture of the nations
safety laws. A lot of diverse grougs are working on swdify-
food
ing tbe/safety laws and the use of alternative sweetrters
conewaer groups, iadustry 4;roups, scieatists, the academic
coaomunity and of course Iftderal regulators.
Before getting into really any overri.v of
aspartame, cyclamates and sacrdhaYiLn, the three major swet-
ners that We're looking at and that rve're using to sa®0 ex-
tent in our products I'd like to just give you an overview
