Big food companies are moving from charity to rights. With one exception – Associated British Foods

December 11, 2013

     By Duncan Green     

Erinch Sahan (right), a private sector policy advisor at Oxfam GB, brings us up to date with the Behind the Brands campaign, and one particularly recalcitrant company.

This is a story of a campaign on Big Food. A campaign successful in moving a bunch of companies, but struggling with one in particular.Erinch Indonesia It is a story of corporate responsibility, of philanthropy vs transparency, rights and voice. It’s a story of Associated British Foods (ABF).

Here’s the campaign

One of our largest corporate-focused campaigns ever, Behind the Brands, is gathering momentum. It focuses on the world’s 10 largest food and drinks companies (the Big 10), challenging them to improve policies on gender, workers, smallholders, land, water, climate change and transparency. These giants of the food trade not only shape what happens in their own operations and supply chains, but set standards that many others follow. With great power (collectively the Big 10 generate $1.1 bn a day), comes great responsibility (was Spiderman really the source for that?). Hence the campaign.

Since we launched in February, we’ve seen the three chocolate giants (Nestle, Mars and Mondelez) take steps to remove the barriers women cocoa farmers face. We’ve seen Coca-Cola release new guiding principles for suppliers on water, General Mills release new sustainable sourcing commitments, Nestle strengthen its commitment to community land rights and Unilever commit to providing training and implement grievance mechanisms for women in their supply chain.

Most impressively, last month Coca Cola made a commitment to land rights for communities affected by land acquisitions. Coke’s move is already starting to resonate through the industry, as suppliers and peers begin to take the issue of community land rights more seriously. Our approach of highlighting the strengths and shortcomings of these global companies seems to be working and we’re sticking with it.

At the heart of the campaign is a scorecard (see below), assessing the policies and commitments of each company, through 276 indicators spanning 7 themes. It was nerdish heaven leading the team of Oxfam super-wonks in putting this together.

Scorecard Nov 2013

ABF languishes at the bottom of the scorecard. Industry insiders and the Guardian tell us that ABF is a different beast. While it owns and runs household food and beverage brands like Twinings, Ovaltine, Kingsmill and Jordan’s, its flagship brand is Primark, a clothing retailer. Unlike the other 9 companies, it also runs sugar farms around the world (it’s the parent of British Sugar and Illovo). It’s a diverse company with seemingly decentralised decision-making.

Sure, ABF is different, but the other nine aren’t identical either. Mars is a private company and Unilever has a major non-food business (shampoos, deodorants etc). While the companies Behind the Brands compares aren’t quite apples and oranges, they are different varieties of apples. ABF is the most different of these ‘apples’, both structurally and culturally. It also says the least about how it does business, which suggests it’s also the ‘bad apple’ among the big 10.

ABF as a company is not as famous as Coca Cola or PepsiCo. So we, and our supporters, have begun focusing on their brands, asking them, via Facebook and Twitter, to tell their parent company to adopt a zero tolerance policy on land grabs. We’ve also been turning up at a few of their brand offices (see picture from Melbourne Australia below, you can tell from the t-shirts and sun), reminding them that more is expected from their parent company.

Here’s ABF’s reaction

BtB ABF stunt Melbourne. Oxfam Australia. Photo-Lara McKinley low resABF has either ignored or dismissed Behind the Brands. When we launched in February, the scorecard showed that ABF discloses less about their supply chains than any of the Big 10. We characterised this as a “veil of secrecy”. Their reaction was to call this “ridiculous”.

ABF’s fresh-off-the-press Corporate Responsibility report (their first since 2010) does, however,  include some encouraging steps, including an adoption of a supplier code and some information on the ingredients they buy for their brands. But there remains a gaping hole on the rights agenda, particularly on land rights.

In October, we highlighted the critical role they play (along with Coca Cola and PepsiCo) in the sugar trade, in our report Sugar Rush. We asked each company to commit to a zero tolerance policy for land grabs. ABF’s response, through their subsidiary Illovo (the largest sugar producer in Africa):

“Oxfam criticises ABF and Illovo for refusing to sign a pledge on land ownership. Pledges are cheap and plentiful. The history of Africa is full of them. The true test of any organisation is what it actually does. ABF and Illovo prefer to act on their beliefs and standards rather than pontificate about them.”

So we turned up at their AGM last Friday, handing out leaflets highlighting to shareholders that ABF should implement a zero tolerance policy for land grabs because: (a) this would help some of the poorest people in the world who are losing their land due to land grabbing; and (b) it’s good for business to prevent land disputes and show leadership on this increasingly important issue. Most shareholders were receptive but when Oxfam supporters asked questions inside the event, ABF senior management formally dismissed the idea.

What we’ve learned

ABF says, and genuinely believes, that it is a good company that does not need civil society to drive its sustainability agenda. From what we can tell, its preferred approach is to find a problem and fix it. This explains why ABF, via Primark, took a leadership role in reaction to the Rana Plaza disaster, where it was the first company to publicly commit to paying compensation and signed up (with more than 80 other brands) to a legally binding building safety agreement backed by trade unions and the Bangladeshi government.

But Oxfam isn’t presenting ABF with a disaster to address, only a complex growing global problem which ABF has a part to play in preventing.coke v pepsiWe do know of reports of ABF being involved in land disputes (including one in Mali portrayed in this documentary) but the thrust of our campaign isn’t “here’s where you’ve done something wrong, now please fix it”; it is to ask for policies that prevent land grabs and for major players like ABF to help make free, prior and informed consent an accepted principle when dealing with community land rights.

Critically for us, the whole ‘race to the top’ strategy, which has worked so well with other companies, has been met, so far, with a stubborn refusal by ABF to move. But we aren’t giving up on them quite yet. We and our supporters will keep telling ABF that when it comes to land rights, its refusal to explicitly accept that communities should have the right to free, prior and informed consent is not good enough. We stand ready to highlight any positive steps the company takes.

From philanthropy to transparency, rights and voice

We don’t judge the morality of ABF or its management. It does many good things, including through some incredibly generous philanthropy. It sources sugar from smallholder cane growers in Africa and generates jobs in some of the poorest parts of the world. But corporate responsibility is moving on from philanthropy to transparency, rights and voice, and ABF risks being left on the wrong side of history. Progressive companies now increasingly disclose key elements of their business (including details of supply chains and policies) to demonstrate accountability. They stand behind human rights publicly, a systemic commitment that goes beyond charitable efforts to benefit workers, smallholders and communities.

Of course, there’s always the issue of policy vs practice when it comes to CSR. But there doesn’t have to be a trade off. A good company can both stand behind core rights through policies and adopt systems to ensure they are implemented. Though this requires transparency and a confidence in being open about how you do business.

With Coca Cola’s bold step, the land rights of communities are increasingly becoming a mainstream CSR issue. But while rights may be the new black (and the foundation of all corporate responsibility), voice is the next black. Leader companies give workers, smallholders and communities a voice, a real say over the impacts business decisions have over their lives. Laggards don’t. ABF needs to catch up. And when it does, we will be the first to trumpet its decision.

December 11, 2013
Duncan Green