Corporations whose products are sold directly to consumers must be especially concerned with reputational risk. Yet despite a 2012 investigation that recorded graphic examples of animal cruelty at one of its suppliers, Tyson Foods has been one of a dwindling number of meat processors that have clung to the use of gestation crates for pigs.
Gestation crates, according to the U.S. Humane Society, are used by meat processing companies to confine breeding pigs in such a way as to nearly immobilize them while they endure repeated impregnations.
"These individual cages are approximately two feet wide," the Humane Society reported. "So small the animals can't even turn around or take more than a step forward or backward."
When Safeway announced in December that it is shifting its pork business to suppliers that use group housing systems instead of gestation crates, it brought the number of companies mandating the more humane practice to 60. In addition to the fact that the vast majority of Americans want gestation crates banned, economic comparisons indicate cost savings when group housing instead of the crates are used.
In August, the Humane Society, Green Century Capital Management and the United Methodist Church Benefit Board submitted a resolution to be voted on by shareowners at Tyson's annual general meeting this month. The shareowners requested that Tyson report to them on the financial and reputational risks associated with the use of gestation crates.
"Tyson's failure to disclose the risks associated with the indefinite inclusion of gestation crates in its supply chain is of concern to shareholders," the resolution states.
Green Century announced this week that along with its co-filers it has withdrawn the resolution filed with Tyson Foods after the company wrote to its pork suppliers, requesting that they use sow housing that "should allow sows of all sizes to stand, turn around, lie down and stretch their legs."
"We're asking the contract farmers who manage Tyson-owned sows to implement improved 'quality and quantity of space' standards in the design of any newly built or redesigned gestation barns beginning in 2014," the letter continued. "We also strongly encourage the hog farmers who sell market hogs to Tyson to improve quantity and quality of space standards for sows when they or their piglet suppliers re-design or build new gestation barns."
"Gestation crates are a cruel and highly controversial part of an industrial meat production system that threatens water supplies, creates air pollution and contributes to global warming," stated Leslie Samuelrich, president of Green Century. "Tyson desperately needed to update its approach to factory farming and this announcement is a positive signal that it understands the need to reduce the reputational risk the company has been facing about its practices."
"Tyson and its shareholders face huge risks if the company is unable to meet customer expectations for better animal treatment," Matt Prescott of the Humane Society added. "While the company's recent move doesn't eliminate that risk, it does represent an important step toward reducing it."
This article originally appeared at Social Funds.
Pig image courtesy of Humane Society.