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October 29, 2012
Food and Agriculture Industry Lags in Assuring Worker Equity
    by Robert Kropp

A report by Sustainalytics and Tellus Institute describes workers' rights as less of a priority for companies in the sector than consumer health, environmental impact, and animal welfare.

Here in Vermont, a majority of workers at the Brattleboro Food Co-op are seeking to unionize in an effort to improve workers' conditions there. After refusing to recognize the union and then attempting to mandate a hearing to be held in Boston, management relented and scheduled a vote for mid-November. However, management also hired the state's largest law firm to fight the unionization effort, leading to calls from stakeholders for financial transparency by management and disclosure of the amount of shareowner funds being spent.

The issues of worker equity and transparency are not confined to relatively small co-ops in rural states, as a report published today by Sustainalytics and Tellus Institute describes. The report, entitled Worker Equity in Food and Agriculture, describes the worker equity practices of 100 of the largest companies in the industry, most of which are headquartered in the US.

Defining worker equity as "a concept that embraces many issues: fair wages, safe working conditions, the right to organize, job security, professional development opportunities, and employee engagement," the report contends that issues such as consumer health, environmental impact, and animal welfare have been prioritized, often at the expense of workers in the industry. "Managing supply chain risks at overseas operations tends to take precedence over local oversight of employees and contractors," the report observes.

Unlike many other industry sectors, the food and agriculture sector features a high percentage of private companies and co-ops. Forty-two of the companies included in the report are either privately held or cooperatives; and while the report found that lack of transparency on social issues such as worker equity prevails throughout the sector, it is most pronounced at those companies that do not have to answer to shareowners.

While pointing out that wages vary by subsector, the report points out that workers overall earn only $18,900 per year, or one-third less than the average wage of workers in other industry sectors. Furthermore, the highest paid CEOs in the sector "receive a total compensation package of between 475 times and 1,023 times that of their typical worker."

Additional issues addressed in the report include unionization, supply chain practices, the relationship between worker equity and food safety, and the occurrence of accidents and fatalities in the sector.

The report recommends that a business case be developed for improving worker equity practices, and that companies build the capacity for acting on them. Companies' disclosure should be improved, and metrics developed for measuring the success of disclosures.

"The time has come to get worker equity data out of the shadows," report co-author Heather Lang of Sustainalytics said. "While companies have made considerable strides in oversight and disclosure of environmental performance, key areas of social impact remain neglected, unquantified, and difficult to assess."

Sustainalytics and Tellus have scheduled a webinar for November 13th at 1 PM Eastern, at which the findings of the report will be discussed by its authors.


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