SUSTAINABILITY AND TRANSPARENCY-FOOD INDUSTRY'S PERFORMANCE

In any commercial company the share holders are supreme and many of the policies are decided by them for implementation by the board of directors. Naturally these share holders can also bring about changes considered beneficial to the performance of the financial of the company. While finances of a company matter a lot, its public image also has a crucial bearing on the perception of the consumers regarding its true character. Recent attempts by bulk investors to give direction to the commercial companies in which they have invested to bring about better transparency in their working style, are indeed welcome. This has happened largely because of the efforts by the organization Oxfam Internationalto assess the functioning of various reputed brand owning companies annually based on their efforts to improve sustainability and transparency in their functioning. Here is a report on this positive development beneficial to the society as a whole.

"Today 33 major investment funds, representing nearly $1.4 trillion of assets under management, called on food industry giants to improve their supply chain policies and transparency. In a statement shared with the ten biggest food and beverage companies in the world, the investors expressed support for Oxfam's Behind the Brands initiative and urged companies to do more to reduce social and environmental risks in their supply chains. "Due to a lack of transparency within the sector, it is difficult to fully evaluate the risk and opportunity that our companies bear within their supply chains," reads the statement sponsored by Calvert Investments and signed by investors including F&C Asset Management, BNP Paribas Investment Partners and Aviva Investors. The investment funds promised to work with their companies to pursue changes to food and beverage company policies. "The data show there is a broad and urgent need for significant improvement across the sector." The investor letter comes six months after the launch of Oxfam's Behind the Brands scorecard, ranking food and beverage companies on their policies and urging them to strengthen their efforts to prevent hunger, poverty and protect the environment. Today Oxfam announced its second update to the rankings showing small improvements companies have made to their policies. Companies including Nestle, Unilever, Coca-Cola, Danone and General Mills have seen slight increases in their scores, though no company performs better than "fair" overall. "The scorecard is a valuable tool to identify areas of risk across companies' supply chains and compare different efforts to mitigate those risks," said Steve Waygood, Chief Responsible Investment Officer at Aviva Investors, a UK fund manager. "We are encouraged by the initial steps some of the companies are taking but hope to see more action and greater commitment from across the industry."

The very fact that the industry is receptive to the idea of improvement in their operations and interactions with society, is itself a major achievement. Backing of this effort by reputed investment funds having controlling interests in the companies concerned can be expected to positively influence the corporate functioning of these players in the coming years. 

V.H.POTTY
http://vhpotty.blogspot.com/
http://foodtechupdates.blogspot.com