When the federal government's health-star rating system for foods was pulled on the day it was meant to launch, it pointed to unexpected interference. It turned out the Assistant Health Minister's chief of staff had links with the food industry. Website gone, PR problem solved – or so they thought.

Corporate and political history is rife with examples insider influence on power holders, but not all companies are blessed with such connections. Corporate sponsorship is an increasingly common – and sometimes controversial – way that companies can gain exposure and influence.

Some companies fund social and environmental not-for-profit groups because they believe in it, are philanthropic for the sake of it, or want to be (or be seen as) good corporate citizens. By and large, though, sponsors expect some payback for their money, and they can benefit in one or more of several key ways.

Here we look specifically at not-for-profit organisations and professional bodies in the health arena, and how sponsors operate in this area.

Healthy halo

Sponsorship can improve a company's image by creating goodwill and a positive association between its brand and the organisation it is supporting. So when McDonald's provides funding for Ronald McDonald House Charities, which help sick children, people feel warmly towards them. This can create a "halo effect", where its goodness in supporting sick children extends more generally to the company as a whole – it's good that McDonald's gives money to sick children, therefore McDonald's is a good company.

However, McDonald's sponsorship of Little Athletics and other sporting groups is a more contentious issue. Every week there are thousands of kids running around in their Little Athletics uniforms with the McDonald's logo on display, earning their McDonald's vouchers as rewards.

On its website McDonald's boasts of its sponsorships of various kids programs, claiming, "Today we like to focus on activities that improve the health and wellbeing of Australian children".

Critics argue McDonald's is simply avoiding responsibility for its role as a provider of food high in fat, sugar and salt in the current obesity epidemic, by shifting the onus from healthy diet to physical activity – then providing funds and publicity for such physical activity.

Dr Jane Martin, of the Obesity Policy Coalition, points out that the hamburger chain is targeting a vulnerable population. Research has shown that marketing to kids through sport influences the types of food children prefer, demand and consume. And ultimately this undermines healthy eating messages and is likely to contribute to poor diets, negative health outcomes, weight gain and obesity.

A McDonald's spokesperson told us, "The main purpose of our support is to add value to the community and to encourage kids to be active and embrace balanced lifestyles. We encourage children to 'never stop playing' by contributing to sporting organisations that develop kids' sports skills and provide opportunities for them to play."

Health washing

"Halo effect" sounds pleasant. "Health washing" sounds less pleasant, and is when a company marketing unhealthy products tries not only to look good (halo effect) but simultaneously seeks to distract from its unhealthy image by supporting healthy causes. McDonald's sponsorship of Little Athletics could be considered health washing.

Like McDonald's, Coca-Cola spruiks the value of physical exercise in leading a healthy lifestyle, diverting attention from the role of unhealthy food and drink choices in obesity and chronic disease – in other words, health washing.

For example, Coca-Cola sponsors Exercise is Medicine, an international program devised and run by exercise physiologists, which uses specially designed exercise programs to treat chronic health conditions (such as cardiovascular disease, diabetes, hypertension, arthritis and osteoporosis) and obesity, as well as certain forms of cancer.

The local website carries the Coca-Cola logo, with the accompanying text: "Coca-Cola South Pacific supports local initiatives which help people lead more active and healthy lifestyles".

Critics feel that it's disingenuous, given that sugary soft drinks have been named and shamed as one of the main contributors to the modern day obesity epidemic, as well as cardiovascular disease, diabetes and cancer – the very conditions Exercise is Medicine addresses. Shifting attention to physical activity suggests it's ok to drink sugary drinks as long as you exercise it off – and that you can outrun a bad diet.

A similar accusation is levelled at Coca-Cola for its sponsorship of the Happiness Cycle program with Bicycle Network, which in turn was heavily criticised for accepting the money. However the decision allowed the Bicycle Network to implement a program that could benefit thousands of teenagers by getting them outdoors riding on free bikes. The network believes that the end justifies the means.

Publicity drive and overdrive

When every kiddie at Little Athletics runs around with a McDonald's logo on their shirt, that's advertising. When cricketers wear beer logos on their shirts, that's advertising. And they're advertising to kids, effectively getting around rules regarding marketing to kids on TV and in print and elsewhere.

Drug companies do the same thing with their freebie handouts to doctors – pens and notepads and so on. As well as keeping the brand name top of mind, psychological studies have shown that receiving even small gifts drives recipients to reciprocate, in this case perhaps by prescribing a particular drug over another equally appropriate one. Medicines Australia, one of the peak bodies representing pharmaceutical companies, is cracking down on small gifts for this reason.

However, pharma-sponsored lavish dinners and overseas conferences show another form of influence. At present there are moves to make these transactions more transparent, although the proposed system of disclosure will be self-regulated by the industry and allow doctors to opt-out. Obviously the ones who are embarrassed by their gifts will consider opting out of disclosure.

Can sponsors influence what an organisation does or says – or what they don't say?

In 2013, the Food and Grocery Council announced a proposal to raise the limit of allowable levels of gluten in foods labelled "gluten free" from the current level, which is no detectable traces, to amounts of up to 20 parts per million (ppm), as in other countries. Coeliac Australia, on the advice of its Medical Advisory Committee, supports the proposed increase.

If "gluten-free" in Australia means the same as in other countries this would be convenient for food manufacturers and importers. It also allows manufacturers a little more leeway and margin for error, so that they can produce food more cheaply.

According to Coeliac Australia, while only one per cent of the population has coeliac disease, 28% of the population choose gluten-free products as a lifestyle choice rather than a safety issue – and they'll benefit from having a wider, cheaper range of goods with low levels of gluten. More recent research by Coles, a major supporter of Coeliac Australia, reported that over 40% of shoppers were buying gluten-free foods.

Nevertheless, some gluten-free food producing companies, such as Freedom Foods, are opposed to the increase and would prefer to keep the current standard. They argue the Australian standard is a world leader, and point out that for some coeliacs the 20ppm level would not be safe, a position confirmed by gastroenterologist Professor Geoffrey Forbes who points out that increasing the amount of dietary gluten will inevitably lead to adverse health outcomes in an undetermined proportion of patients with coeliac disease.

So why would Coeliac Australia support a move that appears contrary to the interests of coeliacs? While Freedom Foods, which has a financial relationship with Coeliac Australia, has spoken out against the increase, some other partners support it. Our concern is that its financial partners, which include companies that make gluten-free products, present a potential conflict of interest.

A spokesperson for Coeliac Australia, David Sullivan, told us, "Coeliac Australia [provides] services to food manufacturers for which they receive a material benefit, and Coeliac Australia receives payment. It is through these services that Coeliac Australia is able to fund education, awareness, services and research in coeliac disease.

"We do not believe these activities present any 'conflict of interest' in regard to our position on the gluten free standard."

Good sports

One of the Australian Institute of Sport's major sponsors is Gatorade, which produces sports drinks and electrolyte replacements.

In advice on hydration, sports drinks are recommended instead of water for exercise bouts of over an hour, partly for rehydration but also as fuel from the carbohydrate and to replace electrolytes (salts) lost in sweat. A few examples of sports drinks are given, including Gatorade – whose logo appears prominently on all pages related to hydration – but no one brand is said to be better than another.

Sports drinks, the AIS assures us, "are not gimmicks. They are legitimate products that are well researched and proven to improve fluid intake and performance". As it happens, most of the 'research' behind these recommendations is sponsored by – you guessed it – sports drink companies, as are the people making the guidelines. And as we discuss below, industry-sponsored research has its own problems.

The issue of whether sports drinks are necessary for most athletes is contentious. Exercise has to be very strenuous for short periods of time (fast running or cycling for an hour, say) or over a long period of time (marathons and other endurance events), for sports drinks to have much advantage over water – see our article on exercise hydration for more on this. While the AIS fact sheets could be said to apply only to elite athletes with highly demanding training and competition schedules, the publications are publicly available to athletes at all levels.

Another issue is that hydration guidelines also suggest that it's best to drink before you're thirsty to avoid dehydration, and the palatability and saltiness of sports drinks encourages this. However independent medical experts recommend athletes drink when they're thirsty.

Industry-sponsored medical research

Funding bias is a particular kind of influence found in scientific research, where results tend to support the interests of the sponsor. This issue recently came to the fore when high profile consumer health advocate Dr Ken Harvey resigned from La Trobe University over its sponsorship deal with Swisse multivitamins company. Swisse has a track record of misusing research results, and has been reprimanded for this by the TGA. Dr Harvey was concerned about similar tactics being used in its partnership with La Trobe.

Dr Harvey points out there are numerous ways that sponsors can get the results they want from research, including:

  • designing research in such a way that the product tested will look good (testing against placebo instead of current best practice, for example, or conducting so many separate tests that at least one will come out favourably simply by chance)
  • distorting results to exaggerate positives and minimise negatives
  • manipulating data (lies, damned lies and statistics)
  • cherry picking the best results (and putting negative findings in "the bottom drawer").

Memory drink? Forget it.

Souvenaid is a "medical drink" promoted by its makers Nutricia as a "clinically proven" treatment for early Alzheimer's disease (AD) – for which there's currently no cure. It contains nutrients from food such as broccoli, tomatoes and fish – foods often found in a Mediterranean diet, which in turn has been found to help prevent or delay memory loss.

Several key Australian geriatricians and psychiatrists have expressed public support for Souvenaid, though others have been more sceptical. However, three studies of the drink, funded and co-authored by Nutricia or its parent company Danone, haven't proven it makes a notable improvement in everyday life.

Importantly, some of these publicly quoted experts were recruited by Nutricia as members of its advisory board. Commenting in the medical press, these experts were able to discuss the potential of the product to pharmacists and GPs.

Nutricia has also provided funding for Alzheimer's Australia (AA), the peak body for advocacy and support for people with AD. AA, with government funding, has published a fact sheet on Souvenaid which, although not a ringing endorsement for the product, tends to emphasise its potential positives while downplaying the lack of evidence for its usefulness. For example, it speculates that the lack of observable effects may have been because the product is working "behind the scenes" to support brain function.

We're concerned that there's a conflict of interest between the sponsor and the people in a position to influence take up of the sponsor's product – the medical specialists and AA. Meanwhile, at a recommended price of $4.16 per drink, it becomes an expensive experiment for a vulnerable patient group when taken daily for the recommended minimum of three months.

Don't mention the war

Conversely, there's potential for sponsors to influence what's not said. When the Dietitians Association of Australia (DAA) formed partnerships with Kellogg's, Unilever, Nestle and other food manufacturers in 2005, there was concern that because some of these companies make products that aren't very nutritious this would appear to be at odds with what dietitians advise people to eat.

Certainly in the early days of sponsorship, some DAA members were dismayed. No one expected the DAA to suddenly extol the virtues of Coco Pops or Kit Kats, but it's what they wouldn't say that had people concerned. In particular, concerns were raised that it would affect the organisation's ability to criticise the marketing of junk food to children and to take a strong stand on consumer-friendly food labelling (traffic lights, stars and so on).

The DAA defends its partnership program, pointing out that it's an opportunity for them to influence industry.

"Talking with industry gives us an opportunity to influence for the better. For example, over time we've seen less salt and more fibre in the Australian food supply. So that's part of our job – to help make the food supply better for all Australians," says the DAA's CEO Clare Hewat.

"In any partnership, we have binding legal contracts, which protect the independence of both organisations. DAA can and does express its opinion without fear or favour and a review of our media releases, public comments and submissions bears that out," adds Hewat.

What can be done?

The Obesity Policy Coalition would like to see governments take action on sponsorship of kids' sports by unhealthy foods and drinks, which undermine government healthy eating campaigns. Measures include providing alternative funding to children's sporting organisations and monetary incentives for clubs to seek other sponsors.

Although there are steps being taken to address pharmaceutical company sponsorships, CHOICE has called for reporting to be extended to drug companies that aren't members of Medicines Australia (like generic medicines producers, which have their own peak body), and to all registered health professionals, not just doctors. Moreover, the reporting system shouldn't allow individuals to opt out.