Cadbury owner could pull investment from Britain because of tough junk food rules

The boss of Cadbury owner Mondelez has raised questions over the future of the company’s investment in Britain amid a ‘volatile’ regulatory environment. 

Chief executive Dirk Van de Put criticised frequent changes made to food and drink regulations by the UK Government in recent years.

He said: ‘We’ve got 100 different targets relating to nutrition… The UK is very important to us, it’s our second biggest country so I cannot neglect it, but it makes you doubt a little bit. 

‘How much should we invest in the UK if this is the environment we have to deal with?’

It comes after the Government introduced tougher restrictions on how foods high in fat, salt and sugar are promoted in shops and advertised earlier this year, in an attempt to tackle obesity.

Van de Put said Mondelez, which also owns the Oreo and Toblerone brands, had invested £40million into reformulating its products, which is now ‘down the drain’ following the recent changes made to regulation.

He also criticised Labour for its failure to include the food and drink industry in its industrial strategy, despite employing over 500,000 people and as the sector battles rising costs and supply chain disruption.

‘It’s weird to me that a sector that represents 25 per cent [of the country’s industrial output] is not included. That has consequences – you don’t get energy subsidies, don’t get R&D subsidies and so on. It doesn’t make sense.’

Cadbury was bought in 2010 by Kraft Foods, which later spun off its global snacks and confectionery business into Mondelez International. It now owns eight sites in the UK, including the iconic Bournville factory in Birmingham.

Asked by the BBC if the UK would lose out on investment because of Government policy, Van de Put said: ‘Yes. We will keep it in mind.’

He added: ‘I think we’ve been good stewards of Cadbury… we have a lot of local production, we export a lot, we have a good footprint here. But if we have to make future decisions for Europe, where we put the next plant, it might not be [in the UK] because of those reasons.’

The confectionery boss also defended the company’s decision to continue operating in Russia.

‘It’s not the most popular decision but I think it’s the right decision,’ he said.

Many Western companies exited Russia after it launched its invasion of Ukraine, but Mondelez continued to do business there while discontinuing new investment and advertising.

Since the start of the war, the country has generated sales of between $1billion and $1.4billion a year for Mondelez.

‘It is tough. I am not a big fan of CEOs taking big political stances, that’s not me. It is a moral choice and if it was just me, maybe the decision would have been different,’ he said.

‘Leaving Russia would probably have left 3,000 of our people without a job and probably 10,000 farmers… It’s not an easy decision. Can we be criticised for that? Yes of course. We pay taxes in Russia that helps the war. I’m not pleased about that.’

Mondelez continues to operate in Ukraine across two manufacturing plants. ‘One plant got hit twice, we’ve rebuilt it twice. We’ve agreed that we will rebuild every single time there so we keep on investing in the country.’