Good news for Brazilian farmers, nutrition rankings and why EITI should shape up
Bitter chocolate
Two leading chocolate companies, Hershey from the US and Switzerland’s Barry Callebaut, are significantly lagging behind their competitors in taking action to stop child labour in cocoa production, according to a non-profit campaign called Raise The Bar, Hershey. The companies are part of the Child Labor Cocoa Coordinating Group (CLCCG), organised by the US department of labour, which has established a “framework of action” for anti-child-labour projects and initiatives. But while Mars’s annual CLCCG commitment to reducing child labour is more than $900,000, and other companies, such as Ferrero and Kraft spend more than $500,000 apiece, Hershey’s contribution is $150,000, and Barry Callebaut’s is $100,000. The companies are “miserly”, even though they are “just as responsible as their counterparts for the atrocious labour conditions of the cocoa sector”, the Raise The Bar campaign says. The group also criticised the quality of the Hershey programme, saying it largely consisted of sending text messages to farmers asking them not to use child labour.
Pesticide payout
More than 1,000 former workers at a pesticides factory in the Brazilian town of Paulínia, near São Paulo, have secured a multi-million-dollar settlement from Shell and BASF for health and environmental damage. The companies agreed a settlement of $214m in a case brought by the Brazilian public prosecutor, the Chemical Workers’ Union, and the Association of Workers Exposed to Chemical Substances. Shell opened the plant in 1977, and it was acquired by BASF in 2000. The plant produced hazardous pesticides to which workers were exposed. Under the settlement, 1,068 former employees will receive about $10,200 for each year they were exposed to the pesticides, and will have their healthcare paid for by the companies for the rest of their lives. BASF, the world’s largest chemicals company, says the settlement “meets the needs of all the parties involved”.
Food for thought
A new index claims to rank major food and drink companies on the basis of their nutrition-related commitments, practices and performance. According to the first edition of the Access to Nutrition Index, the top three performers are Danone, Unilever and Nestlé, while the laggards, out of those that provided information to the researchers, are Japan’s Nichirei and Ajinomoto, and America’s Hershey. The main categories on which companies are scored are the healthiness of their products, how accessible their healthy ranges are, and how they prioritise health in marketing campaigns. The index has been drawn up by the Global Alliance for Improved Nutrition, with funding from the Bill & Melinda Gates Foundation and the Wellcome Trust. The director of the index, Inge Kauer, says it was “an urgent call to action for food and beverage manufacturers to integrate improved nutrition into their business strategies”.
Uppers and downers
The latest review of the FTSE4Good index has resulted in the addition of 20 companies, and the delisting of three. Of the additions, six are US companies (ADT, Iron Mountain, Salesforce.com, Union Pacific, Ventas and Wellpoint) and four are British (Betfair, Cobham, Devro and Vectura). Others are from Japan, South Korea, Australia, Canada, Hong Kong and Spain. Of the delisted companies, two are US semiconductor producers, Applied Materials and Micron Technology, both of which were delisted for failing to meet human and labour rights criteria. Switzerland’s Nobel Biocare was deleted for not meeting environmental management standards, and Japan’s Mitsubishi Corporation fell short against the index’s climate change criteria. FTSE4Good is maintained by the FTSE Group, and claims to “objectively measure the performance of companies that meet globally recognised corporate responsibility standards”.
Dig deeper
The Extractive Industries Transparency Initiative (EITI) needs to sharpen up its act to be more effective, according to a report published by the International Institute for Environment and Development (IIED). In particular, EITI should provide more support so that companies can provide project-by-project breakdowns of payments to governments, should provide more help to local governments and civil society groups, and should offer more evaluation tools, such a progress rankings for member countries, IIED says. Emma Wilson of IIED says EITI is “promising” but should “enable civil society to make use of the information it generates to hold governments and companies to account”. EITI emerged from the 2002 United Nations World Summit on Sustainable Development, and seeks to promote transparency in payments made to governments by oil, gas and mining firms. EITI is presently going through a strategy review.
What’s in a name?
There are more than 6,000 publicly traded companies in the United States, but the number with chief sustainability officers is just 35. This does, however, mark a 30% increase over 2011, when there were just 27 CSOs, according to research by the Weinreb Group, a recruitment consultancy. Of course many companies have sustainability executives, with a range of titles, and at different levels in company hierarchies, but Weinreb Group says its research “is aimed at identifying simply which companies are using this title to elevate sustainability within their ranks”. Companies with CSOs include Coca-Cola, Dupont, General Mills, Kellogg and Oracle.
Worthless audits
Recent deadly garment factory fires in Bangladesh and Pakistan demonstrate the failure of auditing systems set up by western companies to monitor suppliers, the Centre for Research on Multinational Corporations and the Clean Clothes Campaign say in a report titled Fatal Fashion. Fires in late 2012 in Dhaka and Karachi, which killed more than 400 workers, broke out in factories that were “subjected to numerous factory audits by brands or so-called ‘independent’ social audit firms”, the report says. In the Karachi fire, the company received SA8000 certification three weeks before the fire despite “highly visible safety deficits and falsified documentation of fire drills”. Companies must “fundamentally alter their reliance on audit firms and certification bodies,” the report concludes.
Dirty business
US mining company Patriot Coal has been accused of orchestrating a scheme designed to rid itself of pension and retiree healthcare liabilities. Patriot was created in 2007 by Peabody Energy, the world’s largest private-sector coal company, to take over Peabody’s unionised mines. Patriot later also took on the unionised mines of the second largest US coal producer, Arch Coal, resulting in it taking responsibility for 10,000 retirees, most of who never actually worked for Patriot. Now Patriot is going through bankruptcy proceedings, and claims it can no longer meet its obligations. The United Mine Workers of America (UMWA) says the bankruptcy was pre-planned. Patriot is the “vehicle through which Peabody’s and Arch’s scheme to rid themselves of their long-term obligations to these retirees is playing out,” UMWA president Cecil Roberts says. Patriot president Bennett K Hatfield says agreements with UMWA on wages meant the company was “not competitive with other coal producers that operate under more flexible work rules and a significantly lower labour cost structure”.
CSR news Stephen Gardner Sustainability news