Ethical Consumption in the News: April 25 - May 1

This week’s ethical consumption news featured seven notable stories: (1) Target is being targeted by boycotts and buycotts; (2) Earls announced that it will no longer use Alberta beef; (3) uOttawa (sort of) divested from fossil fuels; (4) the tobacco industry’s soaring profit poses a dilemma for pension funds; (5) Tesco escalated its sustainable seafood commitments; (6) Mitsubishi admitted to fudging mileage-requirement tests; and (7) South Korean consumers are boycotting Oxy.

1. Target targeted by boycotts and buycotts

Target recently announced a bathroom policy allowing transgendered people to choose bathrooms based on their individual gender identity. While, in this author’s opinion, the policy is most welcome – one might even remark that “it’s about damned time!” retailers offered the transgendered community this small modicum of dignity and respect – it did provoke backlash from some Americans, including a group called Faith Driven Consumer, who called for a boycott of the company. While the rancor of the religious right in America is hardly news, what is interesting about this particular boycott movement is that it has provoked two “buycotts” alongside it. Buycotts are basically anti-boycotts: rather than asking consumers to stop purchasing from a company in order to punish an undesirable practice, buycotts seek to convince consumers to buy more from a company to reward a desirable practice. In this case we have seen two buycotts emerge:

• A Walmart buycott: supporters of the Target boycott have in some instances championed a buyott of rival Walmart. This underscores how buycotts can complement boycotts in advocacy strategy, through identifying an alternative for consumers that might wish to participate. (Although in this instance Walmart might have preferred not to be identified with an anti-LGBTQI movement.)
• A Target buycott: LGBTQI rights proponents have responded to the Target boycott with a Target buycott, calling on consumers to support the company for its trans-inclusive stance. This demonstrates how buycotts can be used to compete with boycotts in advocacy strategy.

2. Earls ditches Alberta beef in favour of certified humane from the U.S.

This week Earls announced that it had switched from sourcing Alberta beef to “Certified Humane” beef from Kansas, generating substantial coverage in Canadian mainstream news. The Western Canadian restaurant company will now source only Certified Humane beef; the company argues that it was necessary to switch to U.S. suppliers to meet this objective, citing insufficient Albertan supply.

Certified Humane is a relatively small U.S.-based label which, according to my scan of the website, includes just one Canadian farm: Calgary – Lone Pine Colony (L.P. Farm Fresh Chicken), which produces Certified Humane chicken. The label is administered by Humane Farm Animal Care. That organization produced a side-by-side comparison of the Certified Humane standards with some others. According to this, the label differs from USDA Organic in that it requires humane euthanasia at slaughter and has broader space requirements for the animals. The comparison does not include Canadian Organic, which does include minimum indoor and outdoor space requirements (if you are curious, you can read the Canadian Organic standards here).

Bullish: get it? ... I'll let myself out.

This incident highlights the challenges that companies can face when aspects of social license intersect: in this case, demand for humane and antibiotic-free food has run up against local pride in the agricultural industry, at a time when few are bullish about the Alberta economy. There has since been no shortage of outrage, with producers calling the move a “slap in the face”.

One line of debate in reaction to this news is whether Earls should have gone beyond the Certified Humane label to find humane, antibiotic- and hormone-free beef from Alberta. For example, certified organic producers would meet the same, perhaps even higher, standards in these respects. In that regard, rising demand for certification for restaurant suppliers may present an opportunity for Albertan organic farmers and ranchers.

Industry leaders have criticized Earls for failing to consult with them, saying that a Canadian program that is currently in development, Verified Beef Production Plus, could be amended to include the option for farms to opt in to hormone-free criteria. Other Canadian labels are available, including the British Columbian SPCA Certified food label. Given the “crowding” of the ethical label market, some worry that farmers with high standards are being unfairly overlooked, as this incident suggests.

This all illustrates some of the main actors in the political economy of consumer label uptake. Consumer demand for humane and antibiotic-free meat is an important background condition, but given the proliferation of multiple labels with low consumer awareness the decisions of major downstream suppliers (in this case, restaurants) can shape the choices of upstream producers as to whether and which label they adopt. Although governments did not feature in this particular story, they can also play an important role in determining which labels gain the greatest uptake.

3. U Ottawa takes a step toward reducing its environmental footprint

The University of Ottawa divested from fossil fuels on Monday – kind of. While the University will not divest from all firms involved in the production and sale of fossil fuels, it committed to reducing the environmental footprint of its investment portfolio by 30% by 2030 through ramping up its responsible investment efforts. Since 2009 uOttawa has endorsed responsible investment, having signed onto the UN’s Principles for Responsible Investment (PRI). It also plans to create a Clean Innovations Fund and to “transfer $10 million of its long-term portfolio to provide seed capital for investing in clean technologies.” In this sense, uOttawa has championed a green innovation approach to resolving climate change. Another such effort is the creation of a Clean Innovation Research Fund that will allocate up to $3 million by 2020 toward research, teaching, and graduate scholarships. uOttawa’s new policy is just one recent example of the broader “innovation-turn” in climate policy, the darling of which is Canada’s cleantech sector.

Also in campus fossil fuel divestment news this week:

• Stanford’s Board of Trustees rejected divestment on Monday.
• A high-profile Canadian university official told journalists that a senior executive at Shell had hinted that the company “is monitoring the university divestment movement closely and would look unfavorably on any university that divested in regard to future investment”. This offers a concrete example of concerns that may prompt universities, which are increasingly in need of corporate donations given a dearth of government funds, not to divest despite student and faculty demand.
• Divestment activism has continued across universities in the U.S., Canada, te U.K., and Australia this week. For instance, Cambridge University’s divestment movement is ramping up: students held a “Zero Carbon” march on Saturday, with former archbishop of Canterbury Rowan Williams advocating in support of the movement.

4. Renewed profitability of tobacco industry poses a dilemma for mission-based investors

Madison Marriage raised an interesting question: global tobacco firm profitability is high, having rebounded from what was thought to be “terminal decline” fifteen years ago. Given this, should public pension funds invest in tobacco firms?

5. Tesco commits to up its fish sustainability game

The British supermarket chain Tesco made three new commitments to expand the sustainability of its seafood. Two of these commitments pertain to use of the Marine Stewardship Council (MSC) eco-label: Tesco will (1) expand MSC use for pre-packaged and frozen fish and (2) introduce MSC-certified fish to its fish counters across 656 locations. Finally, Tesco committed to (3) source all of its tuna sustainably (the company took strides to make its own-brand tuna sustainable beginning in 2012).

6. Mitsubishi has been fudging fuel economy tests in Japan for a quarter-century

Mitsubishi Motors admitted to having “used improper methods” to test the fuel economy of its vehicles for 25 years. Approximately 625 000 minicars produced in the past three years were marketed as being “as much as 10% more fuel efficient than they were”. However, the problem goes back to 1991 when the company began using “high-speed coasting tests” as the method for testing driving resistance; this practice is not compliant with Japanese regulations.

The admission has once again casts doubt on the auto industry, following the Volkswagen scandal that unfolded last autumn and that remains unresolved. Volkswagen still has not reached a deal with regulators on the required product recalls.  

7. Consumers in ROK boycott Oxy

A coalition of South Korean civic and consumer groups initiated a boycott of Oxy Reckett Benckiser following lung failure that is allegedly connected with the company’s humidifier disinfectants.