Big Food is failing the poor, Oxfam says

The Gunther Report

Big Food is failing the poor, Oxfam says

New research by Oxfam America into the social and environmental policies of the world’s 10 biggest food and beverage companies puts Nestle, Unilever and Coca-Cola at the top of the list and Associated British Foods, Kellogg’s and General Mills at the bottom. In the middle of the pack are Pepsico, Mars, Danone and Mondelez International (formerly Kraft).

Oxfam American said in a press release that the Big 10 food and beverage companies, which together make $1 billion a day, are “failing millions of people in developing countries who supply land, labor, water and commodities needed to make their products.”

That stark accusation was tempered more than a little during a telephone news conference where Oxfam America launched a new global consumer-focused campaign called Behind the Brands.

Ray Offenheiser, the president of Oxfam America, described the big food companies as “recognized industry leaders.” Jane Nelson, a senior fellow at Harvard who specializes in corporate responsibility, went further, saying these are among the “most responsible, best managed, well-governed companies” in the food sector.

So which is it, really? Are these companies industry leaders or are they failing the poor?

Maybe a little of both.

“There has been progress,” Offenheiser said, “but there’s a lot more work that companies have to do to.”

Oxfam America, he explained, began looking at the brands after the global food crisis of 2008 to see what impact the big global food companies and the supply chains they manage are having on an estimated 440 million farmers who own 2 hectares or less of land, most of whom are poor. Most of those farmers are disconnected from global supply chains, and barely growing enough food to feed their own families. It’s not so much that they are being exploited as being excluded from global commerce.

The Oxfam report puts it this way:

"For the past century the food and beverage industry has used cheap land and labor to produce the least expensive products possible  often of low nutritional value  while maximizing profits. Costs like the impact of drained water resources, rising greenhouse gas emissions, and exploitative working conditions have remained off company ledgers, while the industry and its shareholders have prospered."

The organization  which says it works "to right the wrongs of poverty, hunger, and injustice” — now would like the big food companies to bring more small-scale farmers into their supply chains, to protect them against “land and water grabs,” drive down carbon emissions throughout their supply chains, to help empower women and to be more transparent about all they do.

“We want to challenge companies to engage in a race to the top, and we want to educate consumers about these supply chain issues,” Offenheiser said. A well-designed, interactive website invites consumers to check out the performance of their favorite brands and communicate with the companies.

In a 52-page report released Tuesday, Oxfam rates the companies in seven categories: land, women, farmers, workers, climate, transparency and water. The report is tough — on a scale of 1 to 10, not a single company gets a rating of 8, 9, or 10 (“good’) in a single category, and no companies get a passing grade across the board.

This seems overly harsh, given my knowledge about Unilever’s work with small-scale farmers, Coca-Cola’s leadership around protecting watersheds and Mars’ climate targets. [See my 2012 blog post, "Why Mars is a sustainability leader."] Having said that, the relative positioning of the companies seems just about right to me. Unilever and Nestle clearly take a more expansive view of their role, for example, than do General Mills and Kellogg’s.

The Behind the Brands campaign also makes useful distinctions between the companies and identifies key areas where they can improve. On climate, for example, it says:

All of the companies have taken steps to reduce direct emissions, but only five  Mondelez, Danone, Unilever, Coca-Cola and Mars  publicly report on agricultural emissions associated with their products. Unilever alone has committed to halve its greenhouse gas footprint by 2020.

It also says:

"All ten companies are overly secretive about their agricultural supply chains, making their claims of ‘sustainability’ and ‘social responsibility’ difficult to verify. Nestle and Unilever are most open about the countries they source from, but no company is providing enough information about their suppliers."

These kinds of comparisons — they’re known in the NGO worlds as “rank 'em and spank 'em” — can have an impact. Their impact is magnified, if the activists can mobilize consumers to vote with their dollars, or at least through social media and emails to CEOs.

Oxfam America said its first campaign will focus on cocoa. The NGO will target Nestle, Mondelez (which owns Cadbury) and Mars, urging the companies to learn more about how women are treated in their supply chains, and work cooperatively to remedy any inequality they find.

You can download the report and see the full scorecard. 

Photo of supermarket aisle provided by Jonathan Feinstein via Shutterstock.