Pouring Rights Contracts Between Soda Companies and Public Universities: An Institutional Barrier to Sugar-Sweetened...

Sugar-sweetened beverages (SSBs) contribute to obesity, cardiometabolic diseases, and plastic pollution. International health agencies have called upon public-sector organizations to use responsible procurement policies to reduce SSB consumption. Many US public universities cannot do so because of "pouring rights contracts" (PRCs) with Coca-Cola or PepsiCo that grant companies monopoly rights to sell their beverages on campus.

We investigated why universities participate in PRCs using participant observation of a consortium conducting beverage research on all 10 University of California (UC) campuses. We also conducted two rounds of interviews with public university staff in California whose work involved PRCs (n = 26 and n = 25).

PRCs were polarizing. University managers in health and sustainability generally opposed them, dining managers held mixed opinions, and managers in athletics, procurement, contracts, and business partnerships were generally supportive, valuing the discretionary funding streams PRCs provide. These supportive managers tended to form small, but influential coalitions who internally supported the continuation of PRCs, benefiting from reduced transaction costs for their departments because PRCs streamlined contracting and procurement. These supportive managers often had a market orientation that valued economic freedom, contradicting opinions held by opponents of PRCs who stressed that PRCs create a monopoly. Supportive managers also assumed that consumers, not soda companies, are responsible for SSB-related harms, despite acknowledging that PRCs "hook" students on soda.

PRCs are an institutionalized barrier to responsible beverage procurement by concentrating interests favorable to PRCs within the university, even when PRCs contradict the broader, but diffuse, interests of the wider campus community. This suggests that health-harming industries only need to target small, strategically positioned groups of stakeholders within public-sector organizations to achieve corporate capture of public procurement. More responsible procurement policies require public-sector organizations to bolster the financial transparency of contracting managers, request for proposals (RFP) processes, and procurement contracts.