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"Canada can, within a positive friendly atmosphere, ask the Chinese government to resolve the Tibetan situation."

Tibet adds pressure for Olympic sponsors

March 21, 2008

JOE McDONALD AP Business Writer
Newsweek, Mar 19, 2008
AP

McDonald's, Coca-Cola and other sponsors paid tens of millions of
dollars to link their names with the Beijing Olympics. Now they're
trying to mollify activists pressing for change on Tibet, Darfur and
other issues, without angering China.

They have expressed concern over Tibet. Some talk privately to Beijing
organizers. But sponsors insist they should stay out of politics.

"We all have to be careful about how we talk about this," said Chris
Renner, president for China of sports marketing consulting firm Helios
Partners. Its clients include sponsors Volkswagen AG, computer maker
Lenovo Group and mining giant BHP Billiton Ltd.

The Olympics almost always attract activists interested in leveraging
the popular event to publicize their causes.

At the 1996 Atlanta Games, sponsors faced boycott calls after a county
where the beach volleyball event was to be held enacted a measure deemed
anti-gay. In Sydney in 2000, there were protests about the environment
and Australian aboriginal rights.

But the Beijing Games have generated more heat, in part because of an
array of activist groups long critical of China's policies _ and newer
ones focused on its economic and diplomatic clout.

"Everybody knows we're pretty much on the biggest platform you can
pick," Renner said.

Sponsors were already on the lookout for controversy over Sudan, a
diplomatic partner and Chinese oil supplier, as well as press freedom,
human rights and Tibet.

After protests last week by Tibetans against Chinese rule _ and
Beijing's crackdown _ sponsors said they were watching events closely.

A few have turned to public relations specialists for advice, said a
person familiar with the matter, who spoke on condition of anonymity
because of the sensitivity of the issue.

Coca-Cola Co., Lenovo, McDonald's Corp. and others said this week they
plan no changes in strategy.

Likely to face immediate pressure could be Lenovo, Coca-Cola and South
Korea's Samsung Co., the three sponsors of the Olympic torch relay. The
worldwide trek begins this month and will pass through Tibet and up
Mount Everest.

Jiang Xiaoyu, executive vice president of the Beijing Olympics
Organizing Committee, or BOCOG, vowed Wednesday that the anti-government
riots in Tibet last week and a subsequent crackdown by authorities would
not disrupt plans for the torch relay.

"We know the incidents are the last thing we want to see, but we firmly
believe that the government of the Tibet Autonomous Region will be able
ensure the stability of Lhasa and Tibet, and also be able to ensure the
smooth going of the torch relay in Tibet," Jiang told reporters.

Abroad, Tibet activists say they will protest along the torch route in
India, Britain and elsewhere to highlight complaints that Beijing is
degrading the Himalayan region's distinctive Buddhist culture.

"We have no plans to change any of our activities related to the torch
relay," said Christine F. Lau, a Coca-Cola spokeswoman in Beijing.

Samsung said in a statement: "We believe the Olympic Games are not the
place for demonstrations and we hope that all people attending the games
recognize the importance of this."

International Olympic Committee President Jacques Rogge said Sunday the
body is "very concerned" about Tibet. But the IOC insists it is not in a
position to pressure China on political matters.

The Olympics is both a premier advertising platform in the fast-growing
China market and a chance for sponsors to build ties with Chinese
officials by backing a national prestige event.

The companies are counting on the Olympics to raise their profile in
China, increase their market share in the country, and attract local
partners, and they want to avoid jeopardizing access by doing anything
that might upset communist officials. Licensing in China is highly
subjective, and Beijing has retaliated in the past for unwanted foreign
actions by canceling contracts or restricting market access.

Sponsor payments and other marketing revenues are expected to cover the
games' operating costs, about $2.1 billion _ a figure that does not
include spending on venues and public facilities.

Until last week, the sponsors' biggest concern was pressure over Darfur.

Fronted by actress Mia Farrow and employing disciplined public relations
strategies, Darfur activists have been prodding sponsors to lobby
Beijing to help pressure Sudan to end the conflict.

Director Steven Spielberg withdrew as an artistic adviser to the games
after pressure from Farrow, chairwoman of Dream for Darfur, which wants
companies to lobby Beijing. It has warned China that it risks having its
games remembered as the "genocide Olympics" and is issuing "report
cards" to rate sponsors on their Darfur policies.

Dream for Darfur issued a "report card" in June on sponsors and plans to
issue an update this month.

"The companies that get a C, D or F on this next report card will be the
focus of our intensive activism between now and the games," said Jill
Savitt, Dream for Darfur's executive director. She said the group will
picket their headquarters and appeal to TV viewers to turn off their
commercials during the games.

General Electric Co. scored highest at a C-plus in the earlier report,
in part for donating medical equipment and aid to UNICEF, while Savitt
said 13 companies got failing grades.

"The violence and brutality committed against the people in the Darfur
region is appalling," said Deirdre Latour, a GE spokeswoman, in an
e-mail. Still, she said, "It is not GE's role to use the games to
influence government policy."

In the top tier of sponsors are 12 companies that reportedly have paid
at least $100 million each to become Worldwide Olympic Partners.

Lenovo, the only Chinese company among the 12, took into account
possible activism when it made its plans, said Robert J. Page, the
company's Olympics public relations manager.

"All of these potential considerations are taken into the planning
process," Page said. He declined to comment on violent scenarios, but
said, "The potential for people to express their opinions is certainly
something we have taken into consideration, and we would work with BOCOG
on anticipating."

Lenovo hopes to use the Olympics to establish itself as a global brand
following its 2005 acquisition of IBM Corp.'s personal computer unit.
Asked whether the company worries about damage to its image, Page said,
"That's not a concern at this point."

"There is no question that the Olympic Games are a powerful force for
peace," Page said. "We believe that the games will focus on all the good
that is being brought to China, and we are proud to support that."

Coca-Cola, Adidas AG and Omega, a unit of Switzerland's Swatch Group,
say they have talked privately to Beijing Olympics organizers.

They declined to give details, but a BOCOG employee said sponsors have
asked for information on China's position on Darfur and other sensitive
issues.

"They have held intimate discussions with our sponsorship department to
better understand the issues and how it may affect them," said the
employee, who asked not to be identified further because she was not
authorized to talk to reporters.

"It's obviously a fine balancing act that every single Olympics
encounters," said Michael Payne, a former IOC marketing director who now
works as a consultant. "The PR departments of each of the sponsors have
got to be sensible in how they respond."

Robert A. Kapp, a former president of the U.S.-China Business Council,
said it's possible that popular anger, particularly among Americans
concerned with human rights, may become so severe "that some companies
may face a very hard decision as to whether their highly visible support
of the Olympics is causing so much damage that they need to reconsider
their options."

"I could imagine some companies going back to their advertising
departments and external PR advisers and seeing whether there are ways
in which the company's presence in support of the Olympics can be
reviewed with an eye toward these recent and tragic circumstances," Kapp
said by telephone from Port Townsend, Wash.

"There may be different ways of presenting messages that would still
support the Olympics, (but) would not cause undue anger and
disenchantment among the people of China or at the level of the Chinese
government," he said.
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