To counter negative publicity about the tobacco industry, Philip Morris has widely publicized its philanthropy initiatives. Although corporate philanthropy is primarily a public relations tool, contributions may be viewed as offsetting the harms caused by corporate products and practices. That such donations themselves have harmful consequences has been little considered.
Drawing on internal company documents, we explored the philanthropy undertaken as part of Philip Morris's PM21 image makeover. Philip Morris explicitly linked philanthropy to government affairs and used contributions as a lobbying tool against public health policies. Through advertising, covertly solicited media coverage, and contributions to legislators’ pet causes, Philip Morris improved its image among key voter constituencies, influenced public officials, and divided the public health field as grantees were converted to stakeholders.
The tobacco industry's products cause 440 000 US deaths yearly; globally, annual deaths may reach 10 million by 2020.1,2 Negative publicity about the tobacco industry, including its recent federal fraud conviction,3 affects corporate image, employee morale, and company financial ratings.4–12 To counter these effects, Philip Morris and other tobacco companies have widely publicized their local and global philanthropy.13–15 Philip Morris was the third largest US corporate giver in 2005;16 the company has reported donating more than $1.5 billion during the past decade.13
Although corporate philanthropy is recognized for its public relations functions, contributions are frequently viewed as benevolent or neutral—that is, a way for companies to offset the harms their products or practices cause.16–21 That such donations themselves may create harmful consequences for public health has been little considered. We describe here the “Philip Morris in the 21st century” (PM21) image-makeover campaign that began in 1997. We analyze how Philip Morris used philanthropy strategically to improve company image, influence policymakers, and influence public health policies.
Between August 2006 and January 2008, we searched the Legacy Tobacco Documents Library (http://legacy.library.ucsf.edu), which includes more than 7 million internal tobacco industry documents obtained after the 1998 Master Settlement Agreement in the United States.22,23 Using snowball sampling and other search strategies,22,24 we identified documents pertaining to Philip Morris's philanthropy from 1989 to 2004. We started with the search terms philanthropy and charity and then extended our search to include additional terms identified in the documents reviewed. Searches produced approximately 13 000 hits, more than 4450 of which contained the keyword PM21. Reviewing index entries and page content to exclude duplicate and irrelevant documents yielded a final sample of approximately 900 documents. We also searched the LexisNexis, NewsBank, and ProQuest Newspapers databases for related coverage. To evaluate Philip Morris's uses of philanthropy for political leverage, we examined Philip Morris's legislative objectives, searched company documents and newspaper databases to identify elected officials participating in philanthropy initiatives, and searched state legislative websites for bill sponsorship and voting records. By iteratively reviewing documents through an interpretive approach, we assembled a case study.25–27
Our study had limitations. Additional relevant documents may exist that we could not locate because of the material's volume and indexing limitations; the archive is limited by the types of litigation requests. Some documents discussed strategic plans but lacked implementation details; we triangulated evidence from newspaper and legislative databases. Our study is also limited to Philip Morris. Other tobacco companies provide philanthropy14,15; we focused on Philip Morris/Altria28 because it is the most successful tobacco company in the world29 and it has devoted considerable resources to both philanthropic initiatives and self-promotion about such donations.16,30–32 PM21 was United States based; however, because it was considered a template for Philip Morris's overseas initiatives,33–36 our findings may inform research in other countries.
Philip Morris has executed several image-improvement initiatives since 1990.28,37–39 PM21’s predecessor, Project Sunrise, sought to bolster Philip Morris's credibility while undermining tobacco control.37 PM21 was similarly envisioned as fulfilling the corporate affairs mission “to respond to and shape a political, regulatory and attitudinal environment that permits the Company to achieve its business objectives.”40,41 “Shaping” the environment included strategic philanthropy. During PM21, 1997 to 2001, Philip Morris's annual corporate contributions budget rose 71%.39,42 In 2006, Altria funded more than 700 US organizations, making additional donations in more than 70 other countries. All US contributions qualified as tax deductible.13
PM21’s overarching objective was to improve company image.43 According to a 1998 Philip Morris brief, “Today we're viewed as untrustworthy, not credible and insincere… . Our actions must result in a sustainable perception of trustworthiness, credibility and sincerity.”44 Self-promotional themes45–47 were condensed into 4 key messages48 (Table 1).
|“Philip Morris is more than a tobacco company.”48||Advertisements featuring Kraft and Miller Beer subsidiaries48|
|“Philip Morris is committed to responsible practices with regard to all its products, particularly on tobacco.”48||Promotion of “youth smoking prevention” programs;49 publicizing that industry has changed because of MSA;48 support of weak tobacco legislation9|
|“Philip Morris and its people make contributions to the communities and society in which we operate.”48||Parent company and subsidiary donations to charitable organizations; publicizing donations through paid advertising and solicited media coverage50|
|“Philip Morris is made up of outstanding and dedicated people.”48||Advertisements featuring Philip Morris employees volunteering for company-sponsored causes7|
Note. MSA = Master Settlement Agreement.
Presenting PM21 to Kraft employees, Senior Vice President for Corporate Affairs Steve Parrish used the concept of brand equity to equate the parent corporation's image with its subsidiaries’ products: “Image enhancement in our company … will have to become an on-going, never-ending effort, just like the building and maintenance of brand equity. Our brand in corporate affairs is the reputation of our company.”33 Building corporate image required marketing: “While our brand is not a consumer packaged good, building and maintaining its equity follows the same model.”33
After research showed that messages about its charitable contributions had the biggest effect on favorability ratings, philanthropy became PM21’s cornerstone.51 Philip Morris's philanthropy sought “strategic value,” emphasizing hunger, domestic violence, and humanitarian aid.52,53 “To ensure the effectiveness of a food program,” for example, Philip Morris would “develop a logo that people can associate our name and philosophy with.”54 Branding Philip Morris's logo onto philanthropy required causes not already associated with another corporation and plausible justifications other than image enhancement. Hunger could be justified as a “natural area of concern” for the parent company of Kraft55; Parrish explained that domestic violence also suited: “Corporate support is occasional and mostly local… . On a national level there is very little corporate involvement.”56 Education was ultimately de-prioritized: “Education is a crowded field… . We've had a difficult time making this category fit for Philip Morris.”56
Hunger relief was initially selected as PM21’s centerpiece, because “specific mention of our hunger initiatives moved 73% of the test respondents toward a more favorable view of the Company.”57 Under the programmatic shift to “meet undeniable human needs,” as CEO Geoffrey Bible described in a 1999 speech, donations were restricted to initiatives that “directly put food in hungry people's mouths.”58 By year's end, Philip Morris's Contributions Council determined that basing its program on this public relations message ruled out longer-term, structural strategies for eliminating hunger: “Our focus on ‘putting food in hungry people's stomachs’ clearly limits us from a variety of efforts to ‘reduce the problem’ or make the systems more efficient.”59
Focus groups testing messages about forms of hunger assistance, and which types of aid recipients to feature in advertisements, showed that children and elders received most sympathy.60–62 Persons with AIDS received less, and many viewed homeless adults as lazy or prone to substance abuse and therefore responsible for their plight. Correspondingly, groups favored messages about Philip Morris helping children and elders, but also advocated initiatives that promoted self-sufficiency.61,62
Television, radio, and print advertisements to promote PM21 messages were piloted in 4 US cities (Denver, Colorado; Columbus, Ohio; Nashville, Tennessee; and Portland, Maine)51,63 before expanding PM21 nationwide and using it as a model for overseas initiatives.33–36,43,64,65 Although Philip Morris had low overall favorability, research showed that one third of Americans had no opinion of Philip Morris. Moreover, “the current negative opinions of PM … are not … ‘locked in.’” Thus, opportunities existed “to educate, rather than reeducate the public.”63
After devising “new ways to identify key ‘influencer’ segments of the general public,”52 PM21’s target audiences included “opinion leaders,” “suburban parents,” “Gen X'ers,” and “Hispanics,” and later extended to “soccer moms” and minority populations.43,66 According to Philip Morris's 2000 Corporate Communications Plan, women opinion leaders were “more likely to care about tobacco/alcohol issues and to be listened to by politicians.”43 “Soccer moms” were “a critical group for politicians,” and African American and Hispanic leaders were “influential on political thinking.” Finally, “media that serve the above audiences” were targeted: “We need to develop relationships with them and ‘educate’ them.”43
Through publicizing philanthropy, Philip Morris hoped to foster a disconnect between people's views of cigarettes and the company that sold them: “When the advertising works, it gives consumers a reason to compartmentalize their feelings about PM.”67,68 Philip Morris developed advertisements featuring real-life beneficiaries. Stories were to be conveyed in a “non-corporate voice … sincere and authentic” in tone,69 yet communicate that the corporation was the “hero”: “Without Philip Morris, there would be no story.”70 Philip Morris hoped to inspire endorsements: women exposed to the domestic violence ads, for example, might “speak out/endorse PM's involvement in DV [domestic violence] in a positive way.”66 Potential “behavioral change” among the media would be measured as “better news stories” about Philip Morris.71
Throughout PM21, third-party researchers gauged public response and identified messages needing revision.52,61,72–76 Multiple issues arose. Asking individuals to donate to Philip Morris–sponsored hunger initiatives made people “suspicious that not all the money would end up where they wanted… . Their fundamental distrust of Philip Morris made this worse.”62 Focus groups also took offense at a wealthy corporation soliciting donations: “It struck many as the height of arrogance for a ‘multi-bazillion dollar’ company to be hitting up average people for ‘their five bucks.’”61,62
Domestic violence focus groups reacted negatively to ads appearing to highlight the company more than the cause. Group moderators cautioned, “Be careful not to boast too much… . As always, we heard sensitivity to too much boasting and credit-taking.”77 Philip Morris's reasons for donating were also questioned: “Don't try too hard to explain motives… . The more we try to explain and justify, the more it raises suspicion.”77 PM21’s Domestic Violence Taskforce urged caution in communicating with the media: “Sensitivity is needed on when and how we mention when the program began, as it could look as if we implemented it to counteract our public relations troubles.”78
To diminish the appearance of self-promotion, Philip Morris supplemented paid advertising with a “proactive media campaign”79 to generate news coverage.78,80,81 In March 1999, for example, Philip Morris co-sponsored an Operation Feed Kickoff Celebration in Columbus, Ohio. “VIP attendees” included local television, radio, and newspaper representatives; coverage was subsequently provided through all these outlets.80
Publicly associating with respected nonprofits was crucial and influenced the selection of funding recipients. Nashville's Test Market Team, for example, identified organizations “important for PM to partner with for credibility, visibility and to reach target audiences.”82 Second Harvest of Nashville was selected not only because it was a respected organization, but because it had “established valuable media relationships and has offered to use them on our behalf.”82 Philip Morris encouraged or requested grantees to contact local media,53,83 enclosing press release templates in grant check mailings,84 preparing boilerplate (standard, reusable language) letters that grantees could send to local papers,85–87 and ghostwriting op-eds for grantees to submit.88 The public relations agency Burson–Marstellar “shopped” Philip Morris's op-ed pieces.50,89,90 One such published piece, framed as an appeal to support hunger programs for people with AIDS, devoted 3 paragraphs to Philip Morris as an example of “good corporate citizens,” and listed the author as the director of the AIDS Nutrition Services Alliance, a grantee.90
Not all publicity was positive. In 1999, Philip Morris received unfavorable media attention when it was accused of using donations to “buy silence” in California communities proposing tobacco control legislation.91 The city of Richmond passed a resolution withholding government funding from organizations accepting tobacco company money.92 After another county proposed a similar resolution, a domestic violence services agency withdrew its Philip Morris grant application.93–96
Protests against Philip Morris sponsorship also originated within the nonprofit sector. Although several regional YWCA chapters received domestic violence services funding, the national organization condemned Philip Morris for marketing Virginia Slims cigarettes to minority women, co-signing a 1999 newspaper ad titled “Philip Morris Must Change.”31,97,98 During October 1999, after receiving a request from the executive director of the National Domestic Violence Hotline to track calls resulting from Philip Morris's advertising, the director of the Rhode Island Women's Resource Center expressed concern that the decision of some groups to partner with Philip Morris had divided the domestic violence field.99 She predicted the affiliation would be damaging: We are ashamed that the domestic violence cause is being associated with a corporation that the vast majority of states saw fit to sue based on a progressive pattern of lying to the public over the past 40 years… . I believe there will be a strong negative backlash to our association with Philip Morris.
We are ashamed that the domestic violence cause is being associated with a corporation that the vast majority of states saw fit to sue based on a progressive pattern of lying to the public over the past 40 years… . I believe there will be a strong negative backlash to our association with Philip Morris.
The letter was forwarded to Karen Brosius, then director of Philip Morris corporate contributions, who wrote on her copy, “We need to create very effective messages proactively [emphasis in original] to deal with these issues,” and sent it to KRC Research, a communications firm.99
In December, KRC reported: “Nervous grantees believe that both their reputation and their financial health may be at stake if they accept a contribution from a tobacco company… . Will this kind of controversy scare off other donors?”100 KRC recommended conducting opinion polls with carefully phrased questions designed to elicit responses that Philip Morris could use to reassure grantees they would not suffer a backlash or boycott: We would need to make sure that we are asking people to evaluate how they feel about the contributions, the grantees and elected officials who support or oppose the contributions, not how they feel about Philip Morris or the tobacco industry… .100
We would need to make sure that we are asking people to evaluate how they feel about the contributions, the grantees and elected officials who support or oppose the contributions, not how they feel about Philip Morris or the tobacco industry… .100
KRC further suggested testing “talking points” grantees could use “when controversy hits.” KRC suggested measuring public reactions to “show grantees how to defend themselves against attack.”100
Before PM21, company philanthropy had already yielded legislative benefits. In 1990, Philip Morris created a database including the “pet causes and charities” of each member of Congress.101 According to a Philip Morris Information Services employee, “Cross referencing this information with Philip Morris Corporate Contributions data can provide us with a new avenue of access to that legislator.”101 In 1993, Philip Morris Director of Government Affairs Tina Walls spoke to employees about the “influence wheel” of public officials.102 Showing a slide titled, “A Simplified Model of a Legislator's World” (Figure 1), she explained,102,103 We call this chart the Influence Wheel because it illustrates the factors that influence a legislator's political actions and decisions… . We make sure legislators are aware of, and invited to, promotional and cultural events funded by Philip Morris. We also make sure that we know the legislator's—and his or her spouse's—favorite philanthropies and try to support them.
We call this chart the Influence Wheel because it illustrates the factors that influence a legislator's political actions and decisions… . We make sure legislators are aware of, and invited to, promotional and cultural events funded by Philip Morris. We also make sure that we know the legislator's—and his or her spouse's—favorite philanthropies and try to support them.
In 1998, identifying PM21 as another opportunity “to create political capital in DC,” the Washington Relations Office decided to investigate how such “events and activities can be leveraged” with congressmembers.104 By year's end, Parrish reported, hunger relief contributions had proven “a powerful tool in strengthening relationships with Congressional and State Government Leaders.”56
State Government Affairs (SGA) legislative plans for 1999 included strategic philanthropic contributions in several states.105 To “expand contacts with key administration officials and legislators” in Alabama, SGA staff intended to “secure invitations and support their philanthropic events and causes” and invite legislators to attend Philip Morris–sponsored charitable events.105 SGA staff in North Carolina, noting that “the resources of our corporate involvement and philanthropic efforts play a huge role in our ability to meet legislative challenges,” asserted that these initiatives would help them thwart state and local cigarette, beer, and food excise taxes and tobacco marketing restrictions and sustain other policies favorable to doing business in the state.105 Similar “accomplishments” were anticipated for South Carolina, Virginia, and Florida. Kansas staff described hunger donations as already having “enhanced” the “positive environment the companies now enjoy,” and planned to increase these contributions as part of the SGA strategy to defeat excise taxes, smoking restrictions, and state pension divestment and to pass procompany legislation in the areas of tort reform, food sales tax, and alcohol sales.105
California posed challenges, including Philip Morris's poor image, the strength of the tobacco control movement, and the political will of state policymakers to fight the tobacco industry.105 Moreover, other industries were reluctant to form alliances with Philip Morris on issues of common interest, fearing negative publicity: “Although we may be bottoming out in terms of our unpopularity, our tobacco business is still extremely radioactive.” To improve relationships with California legislative opponents, SGA staff decided to “integrate political and charitable contributions as much as possible.”105 Staff also proposed consulting legislators to select grantees, reallocating some donations to “organizations favored by specific legislators.”105
Philip Morris's 1999 to 2000 SGA plans to coordinate philanthropy with legislative objectives are summarized in Table 2. During that year, Philip Morris secured endorsements for its contributions and attendance of local, state, or federal policymakers at Philip Morris–sponsored charitable events in at least 20 states, including those with PM21 test markets (excluding Portland, Maine, the control market).50,106–129,180,181 Philip Morris also made donations to favored causes of 3 governors’ spouses.50,108,182–185 In 13 states, including those with the active PM21 test markets, elected officials attending or endorsing Philip Morris's philanthropy activities also co-sponsored or voted for Philip Morris–supported legislation.130–143
|State||Policymaker Appearance or Endorsement of Philanthropy||Policymaker Favored Philip Morris Position on Legislation||Legislative Objectives Achieved|
|South Carolina||Y (federal)121||Y144,146,174|
|Wisconsin||Y (state and federal)127–129||P144,147,148,151–153,164,167,179|
Note. Y = yes; P = partial. The table includes only those states for which evidence was found that Philip Morris planned to use philanthropy to help achieve legislative objectives or involved elected officials in its philanthropy activities.105
For all states, Philip Morris's Corporate Contributions division informed Washington Relations Office and SGA staff of check-presenting ceremonies for which they could issue invitations to meet “business objectives,” and consulted them about ceremony dates.64,186–188 Check presentations for hunger grantees in 5 states were delayed while the Washington Relations Office and SGA determined suitable dates on the basis of “potential press coverage.”64 Washington Relations Office and SGA staff also provided grant funding recommendations and initiated requests for grantee funding.186,189–191 Funding requests indicated whether each proposed contribution supported “PM's Food, Beer or Tobacco objectives,”190 an event involving elected officials, or a request initiated by an elected official on behalf of an organization.190,192 PM21 advertisements were also purchased when deemed “strategically important” by the Washington Relations Office and SGA.53,79
Parrish's 2000 contributions budget request reported that “closer collaboration” between the contributions department and business operations had yielded “strong linkages between exemplary programs … and public relations and government relations initiatives, particularly through PM21 and the launch of television advertising.”193 A subset of hunger grants were awarded “in key locations, in collaboration with State Government Affairs and Federal Government Affairs.”193 Further plans to “leverage” donations for government relations purposes were made for 2000–2001.194 Formal liaisons between Corporate Contributions and SGA staff for each regional district were established in January 2000,195,196 and SGA involvement in charitable contributions activities continued through at least 2001.191,197–199
According to focus groups conducted in 3 US cities in 2000, Philip Morris's philanthropy ads had “the desired effect of improving opinions about PM”200: A sample of some of the main messages respondents took away after seeing the concepts included: “Philip Morris is giving back” … “PM is helping people who want to be helped” … “PM doesn't just sell cigarettes—they help others all over the world.”200
A sample of some of the main messages respondents took away after seeing the concepts included: “Philip Morris is giving back” … “PM is helping people who want to be helped” … “PM doesn't just sell cigarettes—they help others all over the world.”200
A Roper Starch poll from September 1999 to August 2000 reported, “For the first time, Americans are now about as likely to hold a favorable … as an unfavorable … opinion of PMC.”201 The percentage believing Philip Morris was becoming “a more responsible corporate citizen” rose from 39% to 61%.201 In August 2001, PM21 polling data found image ratings stable, with the notable exception of the West Coast, where those holding a favorable opinion of Philip Morris fell from 34% to 27%. The research firm noted that “aggressively anti-tobacco ads” were prevalent there.72 PM21 was transformed in 2001 into other image enhancement efforts, but 2004 polling data, described in previous research on Philip Morris's Project Sunrise, suggest that the efforts remained effective.37
Our study is the first to show explicitly how Philip Morris's corporate philanthropy serves as a link between corporate image and legislative objectives to influence public health. Corporate philanthropy is an important emerging issue,202 not only for public health, but for other social movements, and it raises difficult questions. First among these is how to address genuine funding needs, because in an era of privatization, many roles formerly filled by government now fall to nonprofits.203–205 Corporate philanthropy, inasmuch as it represents lost taxes to support government programs, reduces governments’ ability to meet societal needs. Although governments do not always represent the public interest as they should, they are legally accountable to the citizenry; corporations are accountable to shareholders.
Another question is how to help recipients understand the full implications of accepting industry funding. Corporate philanthropy, as this and other studies suggest, is used to convert grantees and the public into stakeholders, who may support or keep silent about the corporation's policies or activities or enhance its image.206 Some feel that donating is the least tobacco companies can do.207 However, acceptance of tobacco industry funding comes with a cost, helping to sustain the industry's legitimacy and furthering its business of selling lethal products. Philanthropy is also used to create conflicts within the public health field. Such “divide and conquer” plans were an explicit part of Philip Morris's Project Sunrise.37
A third question is how to determine when and whether corporate philanthropy is truly deserving of tax deductibility. Tax deductions for philanthropy are designed to encourage charitable donations, but US law distinguishes those from business lobbying expenditures. Philip Morris's donations clearly operated as a substitute, tax-deductible form of lobbying that was designed to thwart taxation and avert sales and marketing restrictions. One way to address this would be to have corporate contributions managed through a central government or independent nonprofit agency responsible for grantmaking decisions, thus removing direct corporate influence over grantees and enhancing prioritization according to societal need rather than corporate affairs criteria.
A fourth question is whether policymaker involvement with corporate philanthropy creates conflict of interest disclosure issues. Philip Morris's own data suggest it has successfully leveraged philanthropy with regard to legislative objectives. As with direct political contributions, linkages between public officials and corporate philanthropy should be regularly monitored and cross-checked with legislators’ voting records. Corporations should be required to report charitable contributions or events involving public officials, as they do for lobbying.
Finally, our findings raise the question of how corporate brand advertising is linked with product promotion. PM21 enabled the company to gain desirable television exposure, circumventing the television tobacco advertising ban by promoting its name through its good works. Currently, Philip Morris continues this strategy through its youth smoking prevention advertisements that direct audiences to the company's Web site.208 Implementation of the World Health Organization's Framework Convention on Tobacco Control209 should include banning philanthropic and image advertising as well as product advertising, and developing guidelines to address negative public health consequences of tobacco industry corporate philanthropy, particularly within developing countries with little regulatory or public health infrastructure.
Tobacco industry corporate philanthropy functions to support corporate marketing and lobbying activities detrimental to public health. PM21 favorably influenced perceptions and paid legislative dividends. However, discouraging research on Philip Morris's image on the West Coast suggests that strong counter-industry advertising and a well-funded tobacco control movement reduce the effectiveness of corporate image and philanthropy campaigns.210–213 Future research should explore how industry delegitimization efforts may counter corporate social responsibility initiatives and whether other nontobacco corporate philanthropy plays similar roles.
This research was supported by National Institutes of Health fellowship funding (grant CA113710) and the National Cancer Institute (grants CA095989 and CA120138).
We thank members of the University of California, San Francisco, Institute for Health Policy Studies writing seminar; the University of California, San Francisco, Tobacco Policy Research Group; Dorie Apollonio; Sarah Arvey; Janine Cataldo; Sharon Eubanks; Patricia McDaniel; Naphtali Offen; Elizabeth A. Smith; Nathaniel Wander; Joshua Yang; Valerie Yerger; and the anonymous reviewers for valuable comments on earlier drafts. We also thank Stella Aguinaga Bialous for valuable discussions in the formative stages of this study.
Human Participant Protection
No approval was required for this study.