Health Star Rating progress report prompts Front of Pack discussions

By Joe Lederman (Managing Principal, FoodLegal)

© Lawmedia Pty Ltd, June 2017

The two-year progress report on the Health Star Rating system was issued on 28 April 2017. This article considers the review and the workings of this significant voluntary front of pack scheme.  The Health Star Rating system is a very important consideration in product marketing, label design and strategic planning for food products in the Australian market and beyond.

Health Star Rating review

The Health Star Rating (HSR) system was introduced in 2014 as a voluntary front of pack labelling scheme that food companies would be encouraged by the government to use to indicate certain nutritional values or the “healthiness” of their products to consumers.  The HSR system uses an algorithm devised by a Technical Design Working Group to determine how many “stars” out of five can be displayed on product packaging, depending on nutritional variables such as fat, sugar and vegetable content.

When the HSR scheme was launched, it was decided that the system would be reviewed initially after two years, then again after five years.  The two-year review was completed and endorsed by the Australia and New Zealand Ministerial Forum on Food Regulation on 28 April 2017.  The review dealt with the following notable issues:

Implementation of the HSR system

The review noted a significant uptake of HSR labels by food manufacturers in Australia and New Zealand.  As at June 2016, 2,031 products bore a HSR label in Australia.  807 products in New Zealand bore a HSR label as at April 2016.  The review also cited a high level of consumer awareness of, and ability to use, the HSR system, with the HSR logo being the third-most recognised food logo excluding brand names.

The review indicated that the HSR system has value as a heuristic that is used by consumers to assess the general healthiness of a food product.  This is perhaps what has prompted such a strong uptake among food companies, despite the scheme being voluntary.  Many food companies see the HSR label as a valuable addition to their front of pack.  Indeed, the review even notes that many companies have chosen to reformulate the nutritional content of their products so as to achieve a higher star rating.

However, it seems that use of the HSR varies depending on product type.  HSR uptake was most common among cereal products, fruit and vegetables, sauces and spreads, and dairy and dairy substitute products.  Conversely, there was very limited uptake among confectionary, non-alcoholic beverages, snack foods and sugar, honey and related products.  Unsurprisingly, this highlights a trade-off.  The HSR system may be of less value where only a low star score can be displayed, and where it is costly or impractical to alter the product composition to achieve a higher score.  This is reflected in the fact that the most common number of HSR stars displayed was 4, which appeared on almost double the number of products as the next most common number, 3.5.  Companies may only be incentivised to use the system where they are able to achieve a high score.

Technical anomalies and industry involvement

With such a widespread uptake of the HSR system, and some food companies committing to product reformulation, it is important to consider whether it performs its job as a reliable indicator of nutritional content.  The review reported a total of 17 submissions outlining potential anomalies in the first two years of the HSR system.  Of these, only one submission was found to disclose an actual anomaly, being that the fruit, vegetable, nut and legume percentage for canned vegetables used for calculating the HSR was based on values “as sold”, rather than “as consumed” where the product would be drained.

Under the HSR system, an anomaly arises where a rating is inconsistent with the Australia Dietary Guidelines, or where a rating would mislead consumers if compared with another food category.  Despite a finding of only one anomaly over the two years, the area of nutritional science is commonly evolving, which presents a need for the HSR system to be able to adapt to reflect the latest scientific developments.  This has been reflected in the creation of a Technical Advisory Group ahead of the five-year HSR review which is responsible for overseeing the HSR algorithm in response to changes and anomalies.

The consideration of potential amendments to the HSR algorithm has also been a key issue in stakeholder workshops undertaken by the HSR Advisory Committee.  Industry members outlined concerns that the algorithm did not adequately reflect widely accepted science and could be more strongly aligned with the Australian Dietary Guidelines. 

Other Front of Pack considerations

Whether to include a HSR logo is just one decision faced by food companies when considering the broad landscape of front-of-pack labelling.

There are a number of mandatory requirements which must be complied with, such as provisions in the Australia New Zealand Food Standards Code that set out parameters for health and nutrition content claims.  Additionally, Australia’s new mandatory Country of Origin Labelling (CoOL) system becomes compulsory from 1 July 2018.  Many businesses are in the process of coming to terms with the requirements under the new system.

On top of this, food businesses must consider the branding and marketing material they wish to use.  This involves quantification and consideration of consumer perceptions and preferences.  Knowing what consumers want, or how consumers react to particular messages, is important information when considering the front of pack.  Such information can help inform decisions about, for example, whether more transparent labelling should be used.

Additionally, food companies must be mindful of the overarching prohibition of misleading or deceptive conduct under the Australian Consumer Law when putting together their front of pack labelling.  Businesses should not use words or images that contradict the content of other labels (for example, the use of a prominent Australian flag alongside a Country of Origin declaration that states that the product is made overseas).

FoodLegal Front of Pack Symposium on Thursday 17 August 2017

FoodLegal is holding its “Fighting for your Front of Pack” Symposium in Melbourne on Thursday 17 August 2017.  The Symposium will provide an opportunity to discuss and learn about the latest front of pack issues, and how the front of pack space can be best used by food businesses.

This event brings together expert speakers from the Australian Competition and Consumer Commission, HSR Technical Advisory Group, industry, academia and more, specialising in food product and marketing compliance, nutritional and health science, consumer insights and food composition and technology.

Register here for the special early bird offer.

This is general information rather than legal advice and is current as of 28 Jun 2017. We therefore recommend you seek legal advice for your particular circumstances if you want to rely on advice or information to be a basis for any commercial decision-making by you or your business.