I have long been aware of the “Golden Arches Theory of Conflict Prevention”, which states that no two countries that both have McDonald's have ever fought a war against each other. Now it seems that sales of Coca-Cola might make a good Happiness Index.

 

An article in the Economist (3 July) talks about Coca-Cola’s operations in Africa. It describes how at the macro level Coca-Cola struggles to make a profit, or even operate at all, in countries and societies that are ‘unhappy’. Eritrea, Somalia, and Zimbabwe are all cited as examples of how totalitarian government, violence, or even a simple long term decline in infrastructure can negatively impact the ability of a company to carry out its operations.

 

 

The causal links are clear and these factors would affect the performance of any business. But the special characteristics of a bottle of Coke – as something that is both a low cost commodity and a ‘luxury’ (non-essential) item – mean that Coke is a good tracker of stability and prosperity at the micro level too.

 

Apparently the ups and downs of post-election violence in Kenya this year were directly traced in the sales of Coke in the slums of Nairobi and the villages of western Kenya.

 

Similar effects have been noticed elsewhere – when people are in conflict they do not buy a lot of Coke.

The article closes by suggesting that the future for Africa is bright: Coca-Cola is predicting sales growth of 10-13% per year for the next few years. But I want to close with a different point.

If sales of Coke truly are a ‘happiness index’ then the same is true for other companies too – it's just that the special characteristics of a bottle of Coke make the connection more direct and more visible. In that case the implications are also clear: if increased happiness leads to increased sales, then it is in the interest of every company to focus on increasing the happiness both of its individual customers and its business environment as a whole. It is in the interest of every company to become a Force for Good.