Ethics will lose out if Kraft takes over Cadbury
Set back for ethical consumers imminent
Ethical Consumer urges Cadbury shareholders to reject the takeover deal from Kraft to protect the progress that the British company has made in corporate responsibility.
Founded in 1824 by Quaker John Cadbury in Birmingham it recently become well known amongst ethical consumers for adopting the Fairtrade standard across its high profile Dairy Milk chocolate range in the UK and Ireland. At the time, Cadbury's chief executive, Todd Stitzer, said he planned to convert the group's other chocolate brands to Fairtrade "as soon as we can do it" but maybe these plans are now in doubt.
Cadbury also owns the organic Green & Black's brand, one of the first successful organic chocolate brands to go mainstream whose Maya Gold variety was given the first Fairtrade mark in the UK.
Kraft Foods, called 'the plastic cheese company' by one disgruntled Cadbury's shareholder for its Dairylea brand, has done much less to endear itself to ethical consumers. It hitched its wagon to the less stringent Rainforest Alliance ethical certification scheme, with some Kenco coffees already bearing the mark. It produces the Terry's, Toblerone and Milka chocolate brands but offers no Fairtrade or organic varieties.
According to Rob Harrison, editor of the magazine, “whilst both schemes offer genuine assurances to consumers concerned about human rights in their supply chains, the Fairtrade standard is more demanding in some important respects. Perhaps the key difference is that the Fairtrade mark sets minimum acceptable prices for its agricultural commodities. This can make a substantial difference to endemic poverty in producer communities.
Ethical Consumer’s ethiscore website gives companies a score out of twenty across a much wider range of social and environmental issues. A takeover of Cadbury’s by Kraft would see its score fall from 5 to 3.5.
According to Harrison, “Both companies are large multinationals attracting criticism from a wide range of civil society groups. Cadbury’s likes to talk up its Quaker heritage and claims that this leads to a deeper understanding of its corporate social responsibilities, but evidence of this is now slight.
We are concerned about the potential this takeover has for an erosion of some of the gains made by ethical consumers. Perhaps one day regulatory authorities looking at mergers and acquisitions will be tasked to consider wider societal impacts when considering approval for major takeovers of this kind.”
Furthermore, trade union Unite has warned of job cuts around the world. When Kraft bought another British sweet maker, Terry's, it closed its York factory after nearly ten years.
Check out our buyers' guide to chocolate to see our recommended Best Buys. Subscribers can access this report online with daily-updated scores for the companies.
Alternatively, buy the Chocolate Research Report as a downloadable pdf for £3. This version of the report is as it appeared in the Nov/Dec 2009 issue of the magazine.
1 comment(s) so far...
By Oduox on
Re: Ethics will lose out if Kraft takes over Cadbury
I love to eat Diary Milk by Cadbury's and was looking forward to seeing the fair trade mark on more of their products. I don't have much hopes where Kraft is concerned.